Investment Rating - The report maintains an "Increase" rating for the non-ferrous metals sector, indicating a projected investment return that exceeds the market benchmark index by 5% to 15% over the next 6-12 months [5]. Core Insights - In Q2 2025, the holdings of actively managed equity funds in the non-ferrous metals sector increased, with a notable rise in rare earth and minor metals [1][2]. - The total market value of heavy holdings in the non-ferrous metals sector reached approximately 70.4 billion yuan, representing 4.29% of the total heavy holdings of funds, an increase from 4.22% in Q1 2025 [1]. - The top ten heavy holdings are concentrated in copper, gold, and aluminum, with Zijin Mining remaining the largest holding at 22.8 billion yuan [1]. Summary by Sections Fund Holdings - The increase in holdings is primarily in rare earth and minor metals, with significant increases in stocks such as Guangsheng Nonferrous (largest increase in rare earth), Haotong Technology (platinum, palladium, rhodium recovery), and others [2]. - Conversely, reductions in holdings were noted in aluminum, gold, and certain processing stocks, with the largest decrease in Western Materials (titanium) [2]. Investment Recommendations - The report suggests that supply constraints will support price increases for rare earths, copper, and aluminum, while precious metals will benefit from weakened dollar credit and a rate-cutting cycle [2]. - Specific recommendations include: - Rare Earths: Favorable outlook for prices, with recommendations for Northern Rare Earth and Guangsheng Nonferrous [2]. - Copper: Limited supply growth, with a positive demand outlook in Q4 2025; recommended stocks include Jincheng Mining, Zijin Mining, and Luoyang Molybdenum [2]. - Aluminum: Anticipated supply constraints; recommended stock is China Hongqiao [2]. - Gold: Positive outlook due to weakened dollar credit and increasing ETF demand; recommended stocks include Zhongjin Gold and Chifeng Jilong Gold [2]. Key Company Earnings Forecast and Valuation - The report includes earnings per share (EPS) and price-to-earnings (PE) ratios for key companies, with all recommended companies rated as "Increase" [4]. - Notable companies include: - Zijin Mining: EPS forecast of 1.77 yuan for 2025, PE of 11 [4]. - Luoyang Molybdenum: EPS forecast of 0.62 yuan for 2025, PE of 14 [4]. - Jincheng Mining: EPS forecast of 3.61 yuan for 2025, PE of 13 [4].

Investment Rating - The investment rating for the non-ferrous metals sector is "Increase" [5] Core Viewpoints - In Q2 2025, the holdings of non-ferrous metal heavy stocks by active equity funds increased, with significant increases in rare earth and minor metals [1][2] - The total market value of active equity funds' holdings in the non-ferrous metals sector reached approximately 70.4 billion yuan, accounting for 4.29% of the total heavy stock holdings, an increase of 0.07 percentage points from Q1 2025 [1] - The top ten heavy stocks are concentrated in copper, gold, and aluminum, with Zijin Mining remaining the largest heavy stock [1] Summary by Sections Heavy Stock Holdings - The market value of the top ten heavy stocks in the non-ferrous metals sector includes Zijin Mining (22.8 billion yuan), Shandong Gold (4.4 billion yuan), and Zhongjin Gold (3 billion yuan) [1] - The increase in holdings is mainly concentrated in rare earth and minor metal sectors, with the largest increases seen in stocks like Guangsheng Nonferrous (rare earth) and Haotong Technology (platinum, palladium, rhodium recovery) [2] Investment Recommendations - Supply constraints are expected to support the price increases of rare earths, copper, and aluminum, while precious metals will benefit from weakened dollar credit and a rate-cutting cycle [2] - Specific recommendations include: - Rare Earth: Favorable outlook for rare earth prices, with recommendations for Northern Rare Earth and Guangsheng Nonferrous [2] - Copper: Limited supply growth due to reduced capital expenditure, with recommendations for Jincheng Mining, Zijin Mining, and Luoyang Molybdenum [2] - Aluminum: Anticipated supply ceiling for electrolytic aluminum, recommending China Hongqiao [2] - Gold: Positive outlook for gold prices due to weakened dollar credit, with recommendations for Zhongjin Gold and Chifeng Jilong Gold Mining [2] Earnings Forecast and Valuation - The earnings per share (EPS) and price-to-earnings (PE) ratios for key companies are as follows: - Zijin Mining: EPS of 1.21 (2024), PE of 16 (2024) [4] - Luoyang Molybdenum: EPS of 0.63 (2024), PE of 14 (2024) [4] - Jincheng Mining: EPS of 2.54 (2024), PE of 19 (2024) [4] - Western Mining: EPS of 1.23 (2024), PE of 14 (2024) [4] - China Hongqiao: EPS of 2.36 (2024), PE of 8 (2024) [4] - Northern Rare Earth: EPS of 0.28 (2024), PE of 126 (2024) [4]

Investment Rating - The industry investment rating is "Outperform the Market" and is maintained [1] Core Views - The report highlights that the rare earth market is experiencing improved supply and demand dynamics, particularly for praseodymium and neodymium oxide, driven by frequent bidding from magnet manufacturers and concerns over supply reductions [4] - Precious metals are supported by shifting interest rate expectations and strong U.S. non-farm payroll data, enhancing the attractiveness of gold as an investment [5] - Copper prices are fluctuating at high levels, influenced by tariff expectations and macroeconomic factors, with a potential support level identified at approximately 9,350 USD per ton [5] - Aluminum prices are expected to trend upward due to easing trade tensions and a decrease in overall inventory levels [6] - Antimony prices are stabilizing around 190,000 CNY per ton, with a potential for a stocking-up trend as supply tightens [6] Summary by Sections Industry Overview - The closing index for the industry is at 5,199.61, with a weekly high of 5,230.85 and a low of 3,700.90 [1] Price Movements - Basic metals: LME copper decreased by 0.02%, aluminum increased by 0.97%, zinc increased by 0.70%, lead decreased by 1.32%, and tin increased by 0.74% [18] - Precious metals: COMEX gold increased by 1.79%, silver increased by 5.82%, NYMEX palladium increased by 14.68%, and platinum decreased by 7.32% [18] Inventory Changes - Global visible inventory changes: copper increased by 22,839 tons, aluminum increased by 20,687 tons, zinc decreased by 2,326 tons, lead decreased by 3,512 tons, tin decreased by 126 tons, and nickel increased by 3,167 tons [26]

Core Viewpoint - The non-ferrous metal industry is experiencing a slight rebound, with several ETFs in this sector showing positive performance despite a general market adjustment in A-shares [1][5]. Group 1: ETF Performance - Multiple non-ferrous metal ETFs recorded gains of over 1.5% in half a day, with the Industrial Non-Ferrous ETF (560860) rising by 1.74% and the Non-Ferrous Metal ETF (512400) achieving a half-day trading volume of 1.45 billion yuan [1][2][10]. - The Industrial Non-Ferrous ETF (560860) has a total scale of 654 million units, with a half-day trading amount of 26.0254 million yuan [5]. - The Non-Ferrous Metal ETF (159871) also saw a half-day increase of 1.71%, with a scale of 97 million units and a trading amount of 7.2124 million yuan [7]. Group 2: Market Dynamics - Since March, the non-ferrous metal industry has shown a continuous rebound, with the Industrial Non-Ferrous ETF (560860) increasing by approximately 10 million units since the beginning of the month [5]. - The overall supply-demand dynamics indicate that domestic policies are stimulating copper demand while limiting new smelting capacity, which supports copper prices [5]. - The approach of the consumption peak season is leading to a recovery in order volumes and operating rates across most sectors, providing strong support for aluminum prices [5]. Group 3: Index Composition - The China Securities Industrial Non-Ferrous Metal Theme Index includes 30 large-cap companies involved in copper, aluminum, lead-zinc, and rare metals, reflecting the overall performance of the sector [5][8]. - The China Securities Non-Ferrous Metal Index selects companies engaged in the mining, smelting, and processing of non-ferrous metals, serving as a benchmark for the sector's performance [8].