Di Yi Cai Jing·2026-01-11 13:13Core Viewpoint - The outlook for non-ferrous metals remains optimistic for 2026, with expectations of continued price increases driven by macroeconomic factors and supply-demand dynamics, despite concerns about high valuations and potential risks in the market [1][2][5]. Group 1: Market Performance and Trends - The non-ferrous metals sector has shown strong performance, with the China Nonferrous Metals Index rising over 8% since the beginning of the year, reaching a historical high of 3369 points on January 9 [1]. - In 2025, the China Nonferrous Metals Index recorded a cumulative increase of 91.67%, with leading stocks like Luoyang Molybdenum and Jiangxi Copper seeing price increases of 200.7% and 166% respectively [2]. - The futures market also reflected this trend, with LME copper futures prices increasing by over 40% in 2025, and LME tin and aluminum rising by 39% and 17% respectively [2]. Group 2: Investment Opportunities - Analysts suggest that the demand for metals such as copper and aluminum will continue to rise due to increased global electricity construction and investment in power infrastructure, which is expected to outpace GDP growth [2][6]. - The electric aluminum sector is anticipated to mirror the coal market's performance from 2022 to 2024, with limited supply and high dividend yields making it attractive for value investors [3]. - The ongoing macroeconomic environment, including potential interest rate cuts by the Federal Reserve, is expected to create a favorable backdrop for both precious and non-ferrous metals [6]. Group 3: Institutional Activity and Caution - There has been a surge in public fund applications for non-ferrous metal-themed ETFs, indicating strong institutional interest in the sector [4]. - Despite the positive sentiment, there is a growing caution among market participants regarding high valuations, with the price-to-book ratio of the non-ferrous sector rising from 2 to approximately 3.5 [6]. - Analysts recommend a balanced approach, advising against blindly chasing high valuations while recognizing the ongoing demand and investment opportunities in the sector [6][7].