Precious metals ETF Guotai (159881) surged over 5.8%, watch for geopolitical conflicts and changes in supply and demand dynamics.

On April 8, the Cathay Nonferrous Metals ETF (159881) surged more than 5.8%, with attention on geopolitical conflicts and changes in the supply-and-demand landscape.

Nanjing Securities noted that, for industrial metals, both domestic and overseas copper inventories are currently at relatively high levels over the past three years. It is necessary to closely monitor how inventories are run down after entering the traditional peak season. On the supply side, recent partial downward adjustments to overseas copper mine production are expected to continue shrinking global copper mine supply. As China’s real estate and infrastructure sectors enter their seasonal peak, while demand for copper continues to rise in new areas such as new energy vehicles, solar power, and AI, it is expected that copper downstream demand will still have stable support.

For aluminum prices, on the cost side, the price of alumina is expected to remain in low-range volatile fluctuations. There is insufficient momentum for prepaid anode prices to keep rising. Domestic aluminum social inventories are accumulating noticeably, and inventory levels are higher than the same period in recent years. In the Middle East, conflicts in the region have recently led to partial production cuts and shutdowns of electrolytic aluminum overseas. At the same time, transport through key straits has been disrupted, and the market has been caught in continued uncertainty amid supply-side constraints and a possible downturn on the demand side. Based on calculations, the per-ton profit margin of electrolytic aluminum remains at a relatively high level.

The Cathay Nonferrous Metals ETF (159881) tracks the CSI Nonferrous Metals Index (930708). This index selects securities of listed companies in the nonferrous metals mining, smelting, and processing industries from the Shanghai and Shenzhen markets. It focuses on key products such as copper, aluminum, rare earths, lithium, and gold, to reflect the overall performance of securities of listed companies related to the nonferrous metals industry. The index has characteristics of high volatility and strong cyclicality, and it can reflect how changes in commodity prices and macroeconomic policies affect the industry.

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