Copper aluminum, cobalt lithium and precious metal sectors are recommended. This week (02.07-02.11), the Shanghai Composite Index rose 0.97%, the CSI 300 index fell – 0.71%, the SW nonferrous index rose 3.6%, Comex gold rose 2.16% and silver rose 2.50%. LME prices of major industrial metals aluminum, copper, zinc, lead, nickel and tin changed by 2.07%, – 0.2%, 0.43%, 3.86%, – 0.71% and 1.96% respectively; LME aluminum, copper, zinc, lead, nickel and tin in major industrial metal inventories changed by 13.93%, – 7.40%, – 1.57%, – 1.19%, – 2.90% and 0.62% respectively.
Industrial metals: in January, social finance exceeded expectations, continued to promote credit easing, made steady growth, and pushed up the price of industrial metals. Core view: broad credit exceeds expectations and steady growth is being realized. In January, social finance increased by 6.17 trillion, an increase of 984.2 billion year-on-year. In terms of sub items, the increment is mostly concentrated in urban investment bonds and special bonds, which means the expansion of infrastructure financing demand. It is optimistic that the price of industrial metals will continue to rise under the promotion of stable growth policy. In terms of copper, the US inflation data exceeded expectations, and the Fed’s expectation of raising interest rates strengthened to suppress copper prices. However, China’s steady growth boosted demand, historically low inventories provided support for prices, and copper prices are expected to remain high and volatile. In terms of aluminum, the epidemic in Baise, Guangxi caused 420000 tons of electrolytic aluminum to stop production, the transportation of other products was also affected, and the supply was weak. The resumption of work in the first week after the festival was scattered, and the demand did not fully recover. The social storage is 950000 tons, and the weekly storage is 224000 tons. Focus on: Zijin Mining Group Company Limited(601899) , China Molybdenum Co.Ltd(603993) , Henan Shenhuo Coal&Power Co.Ltd(000933) , Yunnan Aluminium Co.Ltd(000807) , Shandong Nanshan Aluminium Co.Ltd(600219) , Sunstone Development Co.Ltd(603612) , Ye Chiu Metal Recycling (China) Ltd(601388) , Yunnan Tin Co.Ltd(000960) etc.
Energy metals: maintenance affects supply, and the gap between supply and demand leads to a sharp rise in lithium salt prices. Core view: the demand side new energy vehicle enterprises have successively announced the output in January, with a significant year-on-year increase. The supply side is affected by maintenance and tight shipping schedule, and the tight pattern of energy metal supply and demand remains unchanged. In terms of cobalt, under the influence of the epidemic, the transportation period in Africa has been prolonged. Recently, some customs have classified cobalt ore as dangerous goods, which has exacerbated the transportation problem. The demand at the alloy end is improving, and the global cobalt price continues to rise under the tight supply and demand. In terms of lithium, the maintenance of some lithium salt plants at the supply end led to a decline in the supply chain; On the demand side, due to the shortage of raw materials and the reduction of production in the Spring Festival, the production of lithium iron phosphate and Sanyuan has been reduced. However, due to the large gap between supply and demand, the lithium salt in the market is still in short supply, and the price is expected to continue to rise. Focus on: Zhejiang Huayou Cobalt Co.Ltd(603799) , Ganfeng Lithium Co.Ltd(002460) , Tianqi Lithium Corporation(002466) , Yongxing Special Materials Technology Co.Ltd(002756) , Qinghai Salt Lake Industry Co.Ltd(000792) , Tibet Mineral Development Co.Ltd(000762) , China Northern Rare Earth (Group) High-Tech Co.Ltd(600111) etc.
Precious metals: the game between inflation and interest rate increase, and the price of gold fluctuates upward. Core view: the inflation data of the United States in January was higher than market expectations, and the annual inflation rate reached 7.5%, the highest level in nearly 40 years. We continue to be optimistic about the investment value of gold. Soaring inflation data strengthened the Fed’s expectation of raising interest rates by 50bps in March and suppressed gold prices. However, in the medium and long term, US inflation continues to rise, real interest rates are at historically low levels, and gold still has room to rise. Focus on: Chifeng Jilong Gold Mining Co.Ltd(600988) , Yintai Gold Co.Ltd(000975) , Zhaojin mining industry and Shandong Gold Mining Co.Ltd(600547) .
Risk warning: the recovery of demand is less than expected, the release of supply is more than expected, and the uncertainty of policy is increased.
