Non-ferrous metals stocks continued to rise on Friday, August 7, gradually gaining market attention. The ChinaAMC Non-Ferrous Metals ETF (159876), which is the largest and most liquid ETF tracking the same index, surged 3.13% in intraday trading to close at its daily high, marking its fourth consecutive daily gain. From a daily candlestick chart perspective, since hitting a year-to-date low of 0.831 on July 20, the ETF may have formed a volatile upward trend. With strong fundamentals and low valuations, capital is actively positioning for a rebound opportunity from oversold levels. The ChinaAMC Non-Ferrous Metals ETF (159876) has attracted continuous capital inflows over the past four days, totaling 74.5 million yuan, and over the last 10 trading days, it has accumulated 180 million yuan.
Among constituent stocks, indium phosphide concept stock Yunnan Germanium Co., Ltd. surged to its fourth consecutive daily limit-up, China Rare Earth Holdings and Youyan New Materials hit their daily limit-ups, Sirui New Materials rose 10%, Zhuzhou Smelter Group gained over 9%, copper industry leaders Western Mining and Hailiang Co., Ltd. rose over 8%, and Jiangxi Copper climbed over 7%.
On the news front, the Democratic Republic of the Congo, the world's second-largest copper producer, will fully ban the export of copper and cobalt concentrates. The upstream mining of computing metals such as copper and tin is highly dependent on foreign sources, making overseas supply disruptions a new normal for the industry. The United States has added copper to its list of critical minerals, attempting to use trade barriers to boost domestic production capacity while also grabbing global spot resources, leading to a two-year "copper rush" in the US. The accelerated construction of global AI computing infrastructure is driving concentrated demand for non-ferrous metals like copper, tungsten, tin, tantalum, and indium, causing prices of related varieties to rise sharply and creating a "computing metal" market trend. Industry insiders warn that the construction cycle of AI data centers is only 2 to 3 years, but improving the supply side of computing metals takes more than 15 years, meaning the supply-demand gap may peak around 2028, leading to shortages and pushing up computing metal prices.
In the rare earth sector, among 50 bulk commodities closely monitored by the China Federation of Logistics and Purchasing, 14 saw month-on-month price increases in July, with praseodymium neodymium oxide rising 6.4% month-on-month. The price increase of praseodymium neodymium oxide in July confirms a tightening of rare earth supply. There is a long-standing significant price gap between domestic and international rare earth markets, rooted in China's monopoly over midstream smelting and separation capacity, with no quick alternative overseas. Midstream smelting and permanent magnet sectors are the supply bottlenecks of the entire industry chain, with scarcity continuing to materialize, presenting an opportunity for value revaluation.
In the gold sector, the People's Bank of China has increased its gold reserves for the 21st consecutive month, with spot gold standing above $4,300 per ounce. CITIC Securities expects the impact of the situation in the Strait of Hormuz on gold prices to shift from suppression to support, and the Federal Reserve's monetary policy may be more optimistic than market expectations. Combined with rising US military spending driving up deficits, it is forecast that gold prices will return to an upward channel within the year.
With strong fundamentals and low valuations in non-ferrous metals, the ChinaAMC Index R&D Investment Department points out that the right-side allocation value of the sector should be emphasized. Overall, the suppressing factors that led to the sector's correction since March have largely been eliminated. Currently, stable commodity prices support corporate earnings, leading companies still have production growth contributions, and sector profitability is highly certain. With low valuations combined with high growth certainty, now is a quality allocation window for the non-ferrous metals sector.
Different non-ferrous metals have varying boom cycles, rhythms, and driving points, making differentiation inevitable. For those bullish on non-ferrous metals, a more relaxed approach is to capture the entire sector's beta returns through full coverage. The ChinaAMC Non-Ferrous Metals ETF (159876) and its linked funds (Class A: 017140, Class C: 017141) track an index that comprehensively covers copper, aluminum, rare earths, gold, lithium, tungsten, molybdenum, tin, and other industries, allowing for better capture of the sector's beta returns. Additionally, this ETF is a margin trading and short-selling target, serving as an efficient tool for one-click investment in the non-ferrous metals sector. As of August 6, the ChinaAMC Non-Ferrous Metals ETF (159876) had a scale of 1.668 billion yuan, with an average daily turnover of 104 million yuan year-to-date, making it the largest and most liquid ETF among the three tracking the CSI Non-Ferrous Metals Index.
Risk reminder: The ChinaAMC Non-Ferrous Metals ETF (159876) passively tracks the CSI Non-Ferrous Metals Index, which was established on December 31, 2013, and released on July 13, 2015. The composition of index constituents is adjusted periodically according to the index's compilation rules. Historical backtested performance does not indicate future index performance. The constituent stocks mentioned in this article are for display purposes only, and individual stock descriptions do not constitute any form of investment advice, nor do they represent the holdings or trading intentions of any fund under the management. The fund manager assesses the risk level of this fund as R3-medium risk, suitable for balanced (C3) and above investors. The suitability matching opinion should be based on the sales institution. Any information appearing in this article (including but not limited to individual stocks, comments, forecasts, charts, indicators, theories, and any form of expression) is for reference only. Investors must be responsible for any investment decisions they make independently. Furthermore, any views, analyses, or forecasts in this article do not constitute investment advice to readers, nor are they responsible for any direct or indirect losses caused by the use of this content. Fund investment involves risks. Past performance of a fund does not represent its future performance. The performance of other funds managed by the fund manager does not constitute a guarantee of the fund's performance. Fund investment should be cautious.
Comments