March 16, 2026 05:00 PM GMT metal&ROCK | Europe Scenarios for Gold Gold's weakness since the start of the conflict is not unexpected, and history suggests it can rebound quickly after shocks. However, if we see more persistent inflation that drives rate hikes, the set-up may be more challenging. We continue to see upside, but two-way risks are rising. Key Takeaways Gold has been under pressure since the start of the Middle East conflict: Gold is down 5% since Feb 27 as strong YTD performance, a strengthenin ...

Summary of China Basic Materials Monitor - March 2026 Industry Overview - The report focuses on the **China Basic Materials** industry, highlighting changes post-Chinese New Year (CNY) amid elevated commodity prices and geopolitical tensions in the Middle East [1] Key Points Demand Trends - **Mixed Demand Post-CNY**: Demand is strong for energy-related items such as power grid cables, ESS batteries, and export solar modules, but weaker than expected in construction, appliances, automotive, and traditional hardware [1] - **Demand Destruction**: Elevated metal prices have led to a **15-20% demand destruction** pre-CNY, although this has been accepted by the end market for now [1] - **Export Orders Impact**: Producers expect a **5-15% impact on export orders** from the Middle East, particularly in steel, electric vehicles (EV), and energy storage systems (ESS) [1] - **High Energy Prices**: The outlook for high energy prices has made copper traders cautious, leading to increased prices for seaborne and domestic coal [1] Supply Dynamics - **Cement Production Cuts**: Top cement producers are closing **5-15% of their capacity** due to depressed demand [1] - **Carbon Trading Impact**: The inclusion of steel in the national carbon trading platform imposes limited discipline on steel production in 2026 [1] Demand Metrics - **High-Frequency Data**: In the first week of March, Chinese demand was reported to be **50-60% lower year-on-year (YoY)** for cement and construction steel, and **2-8% lower YoY** for aluminum, copper, and flat steel [1] - **Margin and Pricing Trends**: Margins/pricing for coal, aluminum, and lithium improved, while steel and cement prices softened, with copper prices remaining stable [1] Producer Feedback - **Order Book Trends**: A proprietary survey indicated that **95% of respondents** reported a month-on-month (MoM) pickup in March for downstream sectors, and **86% for commodities** [2] Additional Insights - **Cautious Outlook**: The overall cautious sentiment in the market is reflected in the mixed demand and the adjustments in production capacities across various sectors [1][2] Conclusion - The China Basic Materials industry is currently navigating a complex landscape characterized by mixed demand, elevated prices, and strategic adjustments in production. The ongoing geopolitical tensions and energy price fluctuations are critical factors influencing market dynamics.

Performance Overview - Baron International Growth Fund retreated 2.96% in Q4 2025, while the MSCI ACWI ex USA Index appreciated 5.05% and the Proxy Benchmark gained 2.44% [2][4] - For the full year 2025, the Fund gained 21.16%, underperforming the Benchmark's 32.39% and the Proxy Benchmark's 25.74% [2][4] - The underperformance in Q4 was attributed to a correction in several strong-performing stocks, particularly in the Information Technology sector [5][7] AI Market Dynamics - The AI theme continued to dominate market attention, leading to a segmentation between companies benefiting from AI and those at risk of disruption [3] - Traditional quality growth businesses began to be viewed as vulnerable to AI disruption, resulting in material multiple compression [3] - Companies that fail to leverage AI effectively may face risks, while those that adapt successfully could gain market share and improve profitability [3] Sector Performance - The largest detractor to relative performance was adverse stock selection in the Information Technology sector, particularly from companies like Wix.com and Constellation Software [5] - Poor stock selection in the Consumer Discretionary sector, notably eDreams ODIGEO and Trent Limited, also negatively impacted performance [5] - Positive contributions came from the Materials and Energy sectors, with companies like Lundin Mining and Waga Energy showing favorable results [5] Country Performance - Relative underperformance was driven by poor stock selection in Spain, Poland, and Israel, along with an overweight position in India [6] - Strong stock selection in Australia, Ireland, Canada, and France partially offset the negative impacts from other regions [6] Top Contributors and Detractors - Top contributors to performance included Lundin Mining Corporation (0.92%), Taiwan Semiconductor Manufacturing Company (0.48%), and Bank of Ireland Group (0.37%) [8] - Major detractors included eDreams ODIGEO (-1.37%), Ajinomoto Co., Inc. (-0.56%), and ODDITY Tech Ltd. (-0.53%) [12] Recent Investment Activity - New investments included Euronext N.V., Samsung Electronics Co., Ltd., and Brunello Cucinelli S.p.A., focusing on sectors with high growth potential [19][20][21] - Increased exposure to existing positions and a focus on high-conviction ideas were emphasized during the quarter [18][23] Market Outlook - The year 2025 marked the beginning of a sustainable period of international and emerging market equity outperformance [24] - Global economic growth was supported by U.S. policy shifts and increased liquidity, creating a constructive backdrop for international equities [24][28] - Concerns regarding the sustainability of AI-related capital expenditures and potential downward revisions in expectations could impact market dynamics moving forward [26]

ACG Metals ( ACGAF ) is a bit of an oddball in the copper space, but one that deserves your attention. They are running a high-growth copper roll-up strategy, aiming to scale production from the ~20 ktpa they are aboutI am a scientist by training, but today work in a primarily business role within the mining industry. I've been investing since I was a child, when my father first gave me an account as a way to teach me the basics (which incidentally, would've gone better had I been allowed to put it all into ...

Group 1 - The recent sell-off in metals, particularly gold, has raised questions about the sustainability of the previous rally, with significant drops observed, including a more than 5% decline in gold prices [1][2] - There is a focus on potential buying opportunities as investors, especially in China, are expected to start buying the dip in metals like gold, silver, and copper [2][3] - Trading activity in copper has reached unprecedented levels, with the Shanghai Futures Exchange experiencing its busiest month on record, indicating strong market engagement despite recent sell-offs [4] Group 2 - Long-term investment sentiment remains bullish for copper, driven by its critical role in the energy transition and electrification, despite short-term demand headwinds [5]

Market Overview - Global markets experienced volatility with major indices such as Nikkei 225, Hong Kong stocks, and US futures all showing declines [1] - A-shares showed mixed performance, with the Shanghai Composite Index regaining the 4100-point mark while the ChiNext Index rebounded after a dip [1] Commodity Performance - Precious metals and industrial metals faced significant declines, with over 20 stocks hitting the daily limit down, including Nanshan Aluminum and Tongling Nonferrous Metals [2] - International precious metals saw a sharp drop, with spot gold falling by 4% to below $5200 per ounce, and spot silver dropping over 5% [2] Specific Stock Movements - CPO and optical communication stocks surged, with LianTe Technology and Tianfu Communication rising over 11%, while Changfei Optical Fiber hit the daily limit [2] - The education sector saw gains, with China Spring rising over 64% and New Oriental increasing by over 5% [3] Cryptocurrency Market - Major cryptocurrencies continued to decline, with Bitcoin dropping over 6% to below $82,300, and Ethereum and SOL falling over 7% [4] - Over 270,000 individuals were liquidated in the cryptocurrency market, with total liquidation amounts nearing $1.7 billion [4] Dollar Index - The US dollar index rebounded, increasing by 0.44% to 96.58 [5] Geopolitical Factors - Ongoing tensions in the Middle East are impacting global markets, with reports of US President Trump planning to engage in dialogue with Iran [6] - The upcoming announcement of the next Federal Reserve Chair is also a focal point for global markets [7]

Core Viewpoint - Brokerages are optimistic about Vedanta's stock, with Nuvama Institutional Equities raising the target price to Rs 806 from Rs 686, indicating an 18% upside potential from current levels [1][3]. Company Developments - The NCLT approved the demerger of Vedanta into five listed entities, with the base metals business remaining in Vedanta Ltd and four other entities being Vedanta Aluminium, Talwandi Sabo Power, Vedanta Steel and Iron, and Malco Energy [1][8]. - Vedanta is nearing the completion of regulatory approvals for its demerger, which is expected to enhance the company's investment thesis through strong commodity upcycle, cost optimization, and volume growth [2][8]. Financial Projections - Nuvama has revised FY27E/28E EBITDA estimates upward by 17% and 8% respectively, projecting a 20% CAGR in EBITDA over FY25–28E, reaching Rs 724 billion [3][9]. - Average price assumptions for FY27E and FY28E have been increased to $3,000 and $2,750 per tonne for aluminium, $3,000 and $2,900 per tonne for zinc, and $60 per ounce for silver [6][9]. - The INR–USD exchange rate assumption for FY27E and FY28E has been adjusted to 89 from 87.5 [6][9]. Market Performance - Shares of Vedanta were trading at Rs 696, reflecting a 2.6% increase from the previous close, with a peak of Rs 699, marking a 52-week high [8][9]. - Kotak Institutional Equities has set a target price of Rs 780 per share, highlighting that approximately 85% of Vedanta's FY2027E EBITDA will be driven by aluminium (50%), zinc (20%), and silver (15%) [7][9].

Summary of China Basic Materials Monitor - January 2026 Industry Overview - The report focuses on the **China Basic Materials** industry, highlighting the impact of high commodity prices on demand and supply dynamics across various sectors. Key Points Demand Trends - End-user orderbooks are mostly in line with past seasonal trends as of mid-January, with **solar and machinery** sectors showing weakness while **battery** demand remains strong [1] - The surge in metal prices has led to notable changes in downstream demand across sectors such as **consumer electronics**, **hardware manufacturing**, **copper cables**, and **aluminum** in industrial and construction areas, resulting in weaker or delayed orderbooks and rising metal inventories [1] - High-frequency data indicates that in the first two weeks of January, Chinese demand is down **1-9% year-over-year (YoY)** for cement and construction steel, and **3-10% YoY** for aluminum and copper, while flat steel demand is up **3% YoY** [1] Supply Dynamics - Supply conditions remain heterogeneous, with consistent feedback on **cement capacity** cleaning up and ongoing capacity discipline in **coal**, but lackluster control in **steel production** [1] - Margin and pricing for **steel**, **copper**, **aluminum**, and **lithium** have improved, while **cement** and **coal** prices have remained stable [1] Sector-Specific Insights - **Cement**: Demand is lower, with a **1-9% YoY** decline noted [1] - **Aluminum and Copper**: Demand has deteriorated significantly amid high prices, with a **3-10% YoY** decline reported [1] - **Steel**: Margins have improved, but production control remains weak [1] - **Battery Materials**: Strong demand persists, leading to price hikes in solar modules, AC, LFP cathodes, and battery cells [1] Producer Feedback - A proprietary survey indicates a mixed month-over-month (MoM) trend in forward orderbooks, with **19%** of respondents reporting a pickup in January for downstream sectors and **6%** for basic materials [2] Additional Observations - The report notes that in regions with strong demand or better supply structures, price hikes have begun in specific materials, indicating a potential shift in market dynamics [1] - The overall sentiment reflects caution due to high commodity prices suppressing demand, particularly in sectors sensitive to price fluctuations [1] Conclusion - The China Basic Materials industry is currently experiencing a complex interplay of high commodity prices affecting demand and supply across various sectors. While some areas like battery materials show resilience, others like aluminum and copper are facing significant demand challenges. The mixed feedback from producers suggests a cautious outlook moving forward, with potential opportunities in regions with strong demand dynamics.

Core Insights - Precious metals, including gold, silver, and copper, have experienced significant price increases, with gold futures reaching $4,650 per troy ounce, marking a 5% year-to-date gain [1] - Analysts from UBS and Citi predict that gold could reach $5,000 per ounce in the coming months, with silver potentially hitting $100 per ounce, although corrections may occur later in the year [2][3] - The surge in metal prices is attributed to geopolitical tensions, supply deficits, and increased demand for hedging against macroeconomic uncertainties [4][5] Gold Market - Gold futures have climbed to $4,650 per troy ounce, reflecting a 5% increase since the beginning of the year [1] - UBS forecasts gold prices could reach $5,000 per ounce, with a possibility of climbing to $5,400 if political or financial risks escalate [2] - Citi analysts share a similar outlook, suggesting gold could hit $5,000 within three months [3] Silver Market - Silver prices have surged above $91 per ounce, pushing its total market value above $5 trillion for the first time [3] - The metal has increased by 20% since the start of the year, contributing to a nearly 150% rally in 2025 [4] - Concerns over supply deficits and recent export curbs from China have driven the price increase, with silver benefiting from both monetary and industrial demand [4] Copper Market - Copper prices have reached record highs, exceeding $6 per pound in the US and more than $13,188 per ton in London [5] - The increase is driven by concerns over potential import tariffs and an acceleration of shipments to the US, which has tightened global supply [5] - Goldman Sachs has warned of a potential pullback in copper prices, anticipating that tariff decisions may be delayed or not implemented [6]

Market Overview - Copper prices have surged, breaking through $13,000 a ton for the first time, driven by investor optimism regarding a tighter market and a risk-on sentiment in broader financial markets [1] - Three-month futures reached a record $13,387.50 a ton, reflecting a 3.1% increase, as expectations of potential tariffs on refined metals by the Trump administration have led to significant inventory movements into the US [2] Inventory Dynamics - Inventories that previously acted as a buffer are now largely concentrated in the US, leading to concerns about global shortages as miners struggle to increase output [3] - The LMEX Index, which tracks six base metals including copper, has seen its highest levels since March 2022, with copper gaining over 20% since late November [3] Trade and Tariff Implications - The US copper imports in December reached their highest levels since July, influenced by the Trump administration's tariff exemptions on refined metals, which initially paused trade but has since revived due to renewed tariff discussions [3] - The Department of Commerce is expected to provide an update on US copper markets by the end of June, with a potential decision on tariffs for refined metal anticipated [6] Demand Factors - The rally in copper prices is supported by optimism regarding demand in high-growth sectors such as renewable energy, data centers, and power grids [5] - The weakening dollar has also contributed positively to copper and other commodities, as investors engage in the debasement trade [4] Expert Insights - Industry experts, including BlackRock's Evy Hambro, suggest that the copper market could become "very exciting" if various factors align, indicating strong bullish sentiment [5] - Kostas Bintas from Mercuria Energy Group has warned that the current import rush could leave the rest of the world without sufficient copper, highlighting the potential for significant market movements [5]