Key investment points:
In March, the Shanghai Composite Index fell 6.07% and the nonferrous metals sector fell 12.54%, ranking third from bottom among 30 industries, with weak performance. In the Dicer industry, gold (- 0.21%), nickel cobalt tin antimony (- 9.66%), lead and zinc (- 10.04%), aluminum (- 12.10%), rare earth and magnetic materials (- 14.82%), lithium (- 16.96%), other rare metals (- 17.00%), copper (- 19.00%) and tungsten (- 20.22%).
Base metal: the price of nickel fluctuates sharply, and the price of copper and aluminum fluctuates at a high level. Affected by the long short game in the international market, the nickel price of LME fluctuated violently. The London Stock Exchange adopted the policy of stopping trading for one week to intervene in the nickel trading far from the fundamentals. Affected by the conflict between Russia and Ukraine, the price of crude oil and natural gas fluctuated violently. On March 31, Russian President Vladimir Putin announced that natural gas would be settled in rubles, which may lead to an increase in the production reduction scale of European electrolytic aluminum plants and an increase in aluminum supply; Aluminum prices fluctuated at a high level in March, falling first and then rising. LME aluminum inventory continued to decline and maintain a low level. It is expected that aluminum prices will continue to fluctuate at a high level in April.
Precious metals: the conflict between Russia and Ukraine continues, and the prices of gold and silver fluctuate at a high level. In March, Comex gold rose 2.45% and Comex Silver Rose 4.37%. As the conflict situation between Russia and Ukraine is still unclear, the game between various forces intensifies, the West increases various sanctions against Russia, inflation expectations increase, and capital risk aversion increases. On March 17, the Fed's relatively moderate interest rate hike landed, releasing some downside risks of gold. With the repeated covid-19 epidemic, the rise of global inflation expectations, the conflict between Russia and Ukraine and other factors, the price of gold may continue to fluctuate at a high level.
Small metals: in February, the output of new energy vehicles continued to grow, and the prices of lithium and series products rose sharply. In the middle of February, the output of Shanxi Guoxin Energy Corporation Limited(600617) automobile continued to increase significantly year-on-year, and the demand for lithium and cobalt was strong. By the end of March, the price of lithium had reached 3.1595 million yuan / ton, and the price of battery grade lithium carbonate had exceeded 500000 yuan / ton. Low inventory and strong demand for new energy vehicles provided high support for the price of lithium. In the short term, the price of lithium is still easy to rise but difficult to fall, or will continue to fluctuate at a high level.
Rare earths: the price trend of light rare earths has decreased steadily. On March 3, the rare earth office of the Ministry of industry and information technology interviewed key rare earth enterprises, requiring them to enhance their awareness of the overall situation, ensure the stability of the industrial chain, not participate in market speculation and hoarding, give full play to the leading role of demonstration and jointly guide product prices to return to rationality. As of March 31, the prices of most rare earth series products remained stable or fell, terminated the continuous rising market, and the prices may remain stable in the short term.
Investment suggestion: as of the end of March, the PE of non-ferrous sector was 22.06 times, that of precious metal sector was 20.75 times, that of industrial metal sector was 16.45 times, and that of rare metal sector was 30.12 times. The performance of the A-share market was weak in March. Affected by the escalation of the conflict between Russia and Ukraine, the risk aversion of funds from all parties increased, and the volatility of bulk commodities increased. The non-ferrous metal industry was rated as "synchronous market". It is suggested to pay attention to the aluminum, gold and lithium sectors.
(1) geopolitical conflict intensifies; (2) The global covid-19 epidemic worsened.
