Sou Hu Cai Jing·2026-01-21 02:42Core Viewpoint - The A-share market is experiencing a strong upward trend, particularly in the non-ferrous metal sector, with significant gains in related ETFs and stocks [1][5]. Market Performance - As of January 21, the non-ferrous metal sector is showing robust performance, with the Non-Ferrous 50 ETF (159652) rising over 2% [1]. - Key stocks in the sector include: - Shandong Gold up 4.54% - Ganfeng Lithium up 3.10% - Northern Rare Earth up 1.63% [2][5]. Commodity Prices - On January 21, COMEX gold and spot gold both surpassed the $4800 mark, each increasing by over 1%, reaching historical highs [3]. - LME copper is also on the rise, currently up by 0.6% [3]. Geopolitical and Economic Factors - Geopolitical tensions are heightening, leading to increased risk aversion in the market [3]. - The U.S. Federal Reserve's political independence is under scrutiny, particularly with Jerome Powell's upcoming testimony [3]. Policy Developments - On January 20, multiple departments introduced an action plan to enhance the linkage between futures and spot markets for non-ferrous metals, aiming to improve the international competitiveness of the "Shanghai price" [3]. Investment Opportunities - Oriental Securities emphasizes the importance of focusing on industrial metals, predicting a strategic opportunity in the copper sector due to supply constraints and improving smelting fees [4]. - The report suggests that the copper market is expected to benefit from a recovery in production from major mines, which could enhance profit margins for smelting companies [4]. Strategic Insights - The current economic climate is characterized by a "spiral down" phase, highlighting copper's strategic importance as a key metal amid global economic shifts [6]. - The demand for copper is expected to surge due to the AI revolution, with projections indicating an additional demand of approximately 79-170 thousand tons by 2030 from data center expansions alone [6]. ETF Performance - The Non-Ferrous 50 ETF (159652) is noted for its high copper content (34%) and gold content (12%), making it a leading choice in the sector [8]. - The ETF has shown superior performance with a cumulative return of 99.61% since 2022, driven by earnings rather than valuation increases [10].