Investment Rating - The report maintains a positive outlook on the non-ferrous metals industry [6] Core Viewpoints - The geopolitical tensions have escalated, leading to potential corrections in the market. The SW Non-Ferrous Metals Index has adjusted over 20% since the conflict began, indicating a possible recovery if signs of easing emerge. In the long term, rising inflation levels suggest that both precious and industrial metals are building momentum [3][9] Summary by Sections 1. Cycle Assessment - Geopolitical tensions have intensified, with recent conflicts affecting oil prices and market expectations for the Federal Reserve's interest rate policies. The SW Non-Ferrous Metals Index has seen a decline of over 20%, but a potential recovery is anticipated if easing signals appear. Long-term inflation trends indicate that both precious and industrial metals are poised for growth [9][13] 2. Industry and Stock Performance - The non-ferrous metals sector experienced a decline of 14.20% in the week ending March 20, ranking 28th among all industries. The industrial metals sector faced the largest drop [18][20] 3. Macro Data Tracking - The U.S. February CPI increased by 2.4%, while China's February CPI rose by 1.3%. The U.S. target interest rate stands at 3.8%, with an actual rate of 4.39%. The dollar index has decreased to 99.51 [29][30][37] 4. Precious Metals - Gold prices have been under pressure, with SHFE gold dropping 8.28% to 1,039.22 CNY per gram and COMEX gold falling 8.86% to 4,576.30 USD per ounce. The market is currently pricing in a lack of interest rate cuts by the Federal Reserve, which continues to exert pressure on gold prices [14][26] 5. Copper - Copper prices have seen a decline, with SHFE copper down 5.55% to 94,740 CNY per ton and LME copper down 6.66% to 11,929.5 USD per ton. Supply constraints are expected to impact the market, with a recent increase in copper rod operating rates to 81.51% [17][25] 6. Aluminum - Aluminum prices have also decreased, with SHFE aluminum down 3.77% to 24,020 CNY per ton. The domestic operating capacity for electrolytic aluminum remains stable, while geopolitical tensions continue to pose risks to supply [16][25]

Core Viewpoint - CITIC Securities Asset Management Co., Ltd. has reduced its stake in China Aluminum International Engineering Corporation (601600)(02600) by selling 17.6 million shares at an average price of HKD 11.6657 per share, totaling approximately HKD 205 million, resulting in a new holding of about 299 million shares, representing 7.59% ownership [1]. Group 1 - CITIC Securities sold 17.6 million shares of China Aluminum at an average price of HKD 11.6657 per share [1]. - The total amount raised from the sale was approximately HKD 205 million [1]. - After the reduction, CITIC Securities holds about 299 million shares, which is 7.59% of the total shares [1].

Core Viewpoint - The article highlights the transition of public funds from passive shareholders to active governance participants, as evidenced by Wan Jia Fund's disclosure of its voting results for the 2025 fiscal year, marking a significant step in the implementation of governance rules for public companies [1][6][8]. Group 1: Voting Participation and Results - Wan Jia Fund participated in 41 shareholder meetings in 2025, including 15 annual and 26 extraordinary meetings, covering over 552 voting proposals related to profit distribution, guarantee credit, and asset restructuring [3][5]. - Out of the 552 votes cast, Wan Jia Fund voted against 27 proposals, primarily concerning China Merchants Energy's low-price private placement plan, citing concerns over shareholder dilution and insufficient dividends [5][6]. Group 2: Regulatory Framework and Implementation - The disclosure of voting results is part of a broader initiative following the release of the "Rules for Public Fund Managers' Participation in Corporate Governance," which aims to establish a systematic approach for fund managers to engage in governance [7][9]. - The new regulations, effective from 2026, require public funds to disclose their voting results annually, enhancing transparency and encouraging funds to act as active shareholders [8][9]. Group 3: Institutional Environment and Trends - The evolving regulatory environment, including the reduction of shareholder proposal thresholds from 3% to 1%, has lowered the cost of participation for shareholders, facilitating greater involvement in corporate governance [9][10]. - Fund companies are increasingly adopting structured management systems to ensure responsible governance participation, with South Fund establishing a comprehensive process for managing investment responsibilities [9][10].

Investment Rating - The report maintains a positive outlook on the non-ferrous metals industry [6] Core Viewpoints - The geopolitical tensions have escalated, leading to potential corrections in the market. The SW Non-Ferrous Metals Index has adjusted over 20% since the conflict began, indicating a possible recovery if signs of easing emerge. In the long term, rising overall inflation levels suggest that both precious and industrial metals are building momentum [3][9] Summary by Sections 1. Cycle Assessment - Geopolitical tensions have intensified, with recent conflicts affecting oil prices and market expectations for the Federal Reserve's interest rate policies. The SW Non-Ferrous Metals Index has seen a decline of over 20%, but a potential recovery is anticipated if easing signals appear. Long-term inflation trends indicate that precious and industrial metals are gaining strength [9][13] 2. Industry and Stock Performance - The non-ferrous metals sector experienced a decline of 14.20% in the week ending March 20, ranking 28th among all sectors [18][20] 3. Macro Data Tracking - The U.S. February CPI increased by 2.4%, while China's February CPI rose by 1.3%. The U.S. target interest rate stands at 3.8%, with an actual rate of 4.39%. The dollar index has decreased to 99.51 [29][30][37] 4. Precious Metals - Gold prices have been under pressure, with SHFE gold dropping 8.28% to 1,039.22 CNY per gram and COMEX gold falling 8.86% to 4,576.30 USD per ounce. The market is currently pricing in a lack of interest rate cuts by the Federal Reserve, which continues to exert pressure on gold prices [14][26] 5. Copper - Copper prices have seen a decline, with SHFE copper down 5.55% to 94,740 CNY per ton and LME copper down 6.66% to 11,929.5 USD per ton. Supply constraints are expected to impact the market, with a recent increase in copper rod operating rates to 81.51% [17][25] 6. Aluminum - Aluminum prices have also decreased, with SHFE aluminum down 3.77% to 24,020 CNY per ton. The domestic operating capacity remains stable, but geopolitical tensions continue to pose risks to supply [16][25]

Market Overview - The A-share market experienced a significant pullback this week, with major indices declining. The Shanghai Composite Index fell by 3.38% to close at 3957.05, breaching the 4000-point mark [1][5] - Market sentiment has notably cooled, with a clear risk aversion trend as funds continue to flow out [2][4] Index Performance - The performance of indices showed a marked divergence, with large-cap blue chips like the Shanghai 50 Index declining by 2.47%, while mid and small-cap indices such as the CSI 500, CSI 1000, and CSI 2000 saw declines exceeding 5% [1][5] - The overall market is under pressure, reflecting a significant drop in risk appetite [1][2] Sector Analysis - In the context of a broad market decline, defensive sectors such as finance and consumer staples demonstrated strong resilience. The banking sector achieved a positive return of approximately 0.3%, making it the only sector to gain this week [9][30] - Conversely, the materials sector led the decline with a drop of over 10.44%, indicating a shift away from previous commodity-driven trading strategies [9][30] Individual Stock Performance - The electricity sector emerged as a structural highlight, with notable gains in specific stocks. For instance, Huadian Liao Energy surged by 61.34% [16] - The top decliners were concentrated in cyclical sectors, reflecting a trend of "high volatility, high elasticity stocks being prioritized for liquidation" [1][30] Trading Volume and Activity - Total trading volume decreased from 12.49 trillion yuan to 11.06 trillion yuan, a decline of 11.5%, indicating a drop in overall market trading enthusiasm [19][21] - Daily trading amounts fell from approximately 2.33 trillion yuan at the beginning of the week to around 2.06 trillion yuan midweek, despite a slight recovery on Friday [19][21] Fund Flow - Main funds saw a cumulative net outflow of 180.61 billion yuan this week, with significant outflows exceeding 600 billion yuan on multiple days [29][30] - The outflow trend was particularly pronounced in cyclical and technology sectors, while core assets in "computing power chains and new energy leaders" attracted some inflows, indicating a flight to certainty in a risk-averse environment [30][35] Market Sentiment - Market sentiment shifted from a previously active state to a more cautious approach, with the number of stocks hitting the daily limit down rising significantly [37][40] - Margin trading balances showed a slight decline, reflecting investors' tendencies to reduce leverage and risk exposure [42] Upcoming Focus - Attention will be on policy stabilization, changes in fund flows, and external disturbances, particularly regarding international oil price fluctuations and the upcoming release of locked shares [46][47]

Commodity Market - As of March 20, London spot gold decreased by 3.42%, closing at $4,491.670 per ounce, while COMEX gold futures fell by 2.47%, settling at $4,492.0 per ounce [1] - London spot silver dropped by 6.80%, ending at $67.897 per ounce, and COMEX silver futures declined by 4.78% [1] - LME copper fell by over 2%, while LME zinc saw a slight increase; LME aluminum and LME tin both decreased by over 1%, and LME nickel experienced a minor decline [1] Oil Market - As of March 20, ICE Brent crude oil rose by 0.61%, and NYMEX WTI crude oil increased by 2.66% [2]

Investment Rating - The report maintains a "Market Weight" rating for the non-ferrous metals industry, indicating that the industry index is expected to perform within ±10% of the market index over the next six months [61]. Core Insights - The non-ferrous metals industry experienced a decline of 15.49% over the past two weeks, underperforming the CSI 300 index by 14.10 percentage points, ranking 31st among 31 industries [4][13]. - The report highlights significant price declines across various sub-sectors, with the industrial metals sector down 16.45% and small metals down 17.94% in the same period [17][19]. - The Federal Reserve's decision to maintain the federal funds rate between 3.5% and 3.75% has contributed to a decrease in inflation concerns, impacting precious metal prices negatively [6][55]. Summary by Sections Market Review - As of March 19, 2026, the non-ferrous metals industry has seen a year-to-date increase of 1.84%, outperforming the CSI 300 index by 2.85 percentage points [13]. - The report notes that the precious metals sector has been particularly affected, with gold prices dropping to $4651.90 per ounce, a decrease of $684 since early March [34][55]. Price Analysis - Industrial metals prices as of March 19 include LME copper at $12,211.50 per ton, LME aluminum at $3,242.00 per ton, and LME nickel at $17,065.00 per ton [25][58]. - The small metals sector has seen significant price fluctuations, with the rare earth price index at 252.06, down 49.42 points since early March [42][56]. Industry News - The report mentions the Federal Reserve's stance on interest rates and its implications for inflation and commodity prices, emphasizing the need for clarity on geopolitical situations affecting the market [48][55]. - A collaboration between Japan and the U.S. for joint development of rare earths and lithium is highlighted, indicating potential shifts in supply chains [49]. Company Announcements - Northern Rare Earth (600111) plans to invest 112 million yuan in a new production line for rare earth metal alloys, expected to generate significant revenue [50]. - Cangge Mining (000408) reported a 49.32% increase in net profit for 2025, reflecting strong performance in the potassium chloride market [51].

Report Overview - Report Title: Non-ferrous Metals Weekly Report - Date: March 20, 2026 - Industry: Non-ferrous Metals (Focus on Zinc) 1. Report Industry Investment Rating - Not provided in the given content 2. Core Viewpoints - The macro - sentiment is bearish this week, with the market focusing on the Fed's interest rate decision and the ongoing Middle East geopolitical conflict. The Fed's hawkish stance and geopolitical tensions have led to a global market slump. Non - ferrous metals show anti - decline differentiation based on fundamentals. Zinc is weak due to high domestic and overseas inventory, but with improving domestic consumption and inventory de - stocking, the deep - decline space is limited, and it will mainly oscillate and repair at low levels [7][9][10] 3. Summary by Directory 3.1 Zinc - Market Review and Operation Suggestions Market Review - The macro - sentiment is bearish, with the market focusing on the Fed's interest rate decision and the Middle East geopolitical conflict. The Fed's hawkish speech and the escalation of the Middle East situation have led to a global market slump. Non - ferrous metals show anti - decline differentiation. Zinc is weak due to high inventory, and the de - stocking inflection point has not been confirmed [7] - This week, the correlations between the US dollar, the RMB, and LME zinc are 22% and - 6% respectively, compared with - 89% and - 69% last week. The SHFE/LME ratio is 7.37, and the import loss per ton of zinc ingots narrows to - 2435.8 yuan/ton. The spot discount narrows. LME inventory is 117,850 tons, and 0 - 3C is 34.83. Investment funds' long and short positions both increase, with a net long of 4,868 lots [8] Operation Suggestions - The Fed maintains the interest rate but has a hawkish attitude. With the digestion of negative factors, the price rebounds slightly in the later week, but the zinc ingot import window remains closed. Overseas inventory is high and consumption is weak, while domestic social inventory starts to de - stock, and downstream consumption gradually meets the peak - season expectations. In the short term, the weakness of SHFE zinc has not reversed, but the deep - decline space is limited, and it will mainly oscillate and repair at low levels [9][10] 3.2 Fundamental Analysis Supply Side - Domestic zinc concentrate processing fees remain flat, and the import TC index continues to decline. In March, domestic zinc concentrate supply is expected to increase, and the average domestic TC of SMM Zn50 remains at 1,550 yuan/metal ton. The import TC index drops by 6.02 to 5.23 US dollars/dry ton [14] - Zinc ingot production in March is expected to increase month - on - month. In February, refined zinc production decreases by 56,000 tons to 504,600 tons. Although the production profit of refined zinc enterprises is about - 2400 yuan/ton, the comprehensive profit has no obvious loss, and production remains at a high level [14] Demand Side - Galvanizing: The operating rate is 59.7%, a 6.7% month - on - month increase. After the end of environmental control in the north, the industry has basically returned to the pre - Spring Festival level. Terminal demand is released, orders are improving, and finished - product inventory is de - stocking. The operating rate is expected to continue to rise slightly next week [15] - Die - cast zinc alloy: The operating rate is 51.61%, a 3.26% month - on - month increase. Terminal procurement increases, driving better sales and inventory de - stocking. However, price fluctuations of zinc, aluminum, and copper squeeze profits, and some enterprises raise processing fees [15] - Zinc oxide: The operating rate is 55.36%, a 2.63% month - on - month increase. Zinc price decline leads to increased raw - material inventory and decreased finished - product inventory. Orders of leading enterprises are normal, and the operating rate is expected to continue to rise with the warming of demand [16] Spot Market - Domestic inventory decreases by 9,700 tons to 266,100 tons as of March 19. LME zinc inventory is 117,850 tons, and there is a large - scale warehousing in Singapore on March 17, pushing the inventory above 118,000 tons [17]

Group 1 - CITIC Securities Asset Management Company reduced its stake in China Aluminum (02600) by 17.6 million shares at an average price of HKD 11.6657 per share, totaling approximately HKD 205 million [1] - After the reduction, CITIC Securities holds approximately 299 million shares, representing a holding percentage of 7.59% [1]

Investment Rating - The report maintains a "Market Weight" rating for the non-ferrous metals industry, indicating that the industry index is expected to perform within ±10% of the market index over the next six months [60]. Core Insights - The non-ferrous metals industry has experienced a significant decline of 15.49% over the past two weeks, underperforming the CSI 300 index by 14.10 percentage points, ranking last among 31 industries [4][13]. - The report highlights that geopolitical disturbances and reduced expectations for interest rate cuts have led to increased volatility in the non-ferrous metals market [2][3]. - The performance of various sub-sectors within the non-ferrous metals industry has varied, with the small metals sector experiencing the largest decline of 17.94% in the last two weeks [18][19]. Market Review - As of March 19, 2026, the non-ferrous metals industry has seen a year-to-date increase of 1.84%, outperforming the CSI 300 index by 2.85 percentage points [13]. - The report notes that the gold market is currently characterized by intensified long and short positions, awaiting further clarity on geopolitical situations [54]. - The report provides detailed price movements for key metals, including LME copper at $12,211.50 per ton and LME aluminum at $3,242.00 per ton as of March 19, 2026 [25][57]. Sub-sector Analysis Industrial Metals - Industrial metals have shown mixed performance, with aluminum prices being supported by geopolitical factors affecting global supply chains, while copper and tin prices are under pressure due to reduced demand expectations [55]. Precious Metals - Precious metals have faced downward pressure, with COMEX gold prices falling to $4,651.90 per ounce, a decrease of $684 since early March [33][54]. Small Metals - The small metals sector has seen significant price declines, with the rare earth price index dropping to 252.06, down 49.42 points since early March [41][55]. Company Announcements - Northern Rare Earth (600111) plans to invest 112 million yuan in a joint venture to build a production line for rare earth metal alloys, expected to generate an average annual revenue of approximately 1.366 billion yuan [49]. - Cangge Mining (000408) reported a 49.32% increase in net profit for 2025, driven by strong market demand and improved sales prices [50].