Cathay Pacific Haitong: Precious metal price breakthroughs are optimistic that the gold, copper and aluminum sector's valuation center will rise

The Zhitong Finance App learned that Cathay Pacific Haitong released a research report saying that the long-term logic of precious metals is solid, and the time has arrived for a long-term layout. The resource game strengthens the strategic value of copper and affects the short-term copper price rhythm, but it is not expected to change the strong logic in the medium term. Looking at the medium- to long-term outlook, the bank continues to be optimistic about the investment value of rare earths as a key strategic resource. Supply tightening is compounded by global order restructuring, and the tungsten sector's boom is expected to continue to recover. In a situation where there is a tight balance between supply and demand, the supply-demand balance sheet is important, but it is necessary to pay more attention to the core influence of the macro on metal price trends. Monetary policy, macroeconomic expectations, geographical games, and supply disturbances will be the winners and losers.

Cathay Pacific Haitong's main views are as follows:

Precious metals: The price of precious metals broke through and continued to lay out the precious metals sector

Non-agricultural farmers in the US fell by 23,000 in July, expectations for non-agricultural supermarkets declined in July, and the market's pricing for the Federal Reserve's interest rate hike during the year declined. The US Treasury increased treasury bond repurchases to reduce interest rates on long-term bonds, but there was little effect. Market concerns about US bonds intensified, and precious metals prices broke through. Despite geopolitical fluctuations in the Middle East, correlation has declined, and precious metals prices are expected to continue to rise. Precious metals have solid long-term logic, and the time has come for a long-term layout. Recommended targets: Shanjin International, CICC Gold, Chifeng Gold, Shengda Resources; Related targets: Zhaojin Mining.

Copper: Tariff catalysis, resource games reinforce the strategic value of copper

US copper tariffs are expected to approach, global resource competition or intensification, and supply constraints are strong. At the same time, US high deficits and debt expansion continue to weaken US dollar credit, and resource-side values are expected to continue to be revalued. Next week's Jackson Hole meeting will be an important macro-observation window. The Fed's policy statement or influence the short-term pace of copper prices through US dollar and US bond interest rates, but it is not expected to change the medium-term strong logic. Recommended targets: Western Mining, Zijin Mining.

Aluminum: Domestic exports to the bottom, aluminum prices fluctuate

At the macro level, peace talks between the US and Iran have stalled, and the geopolitical risk premium still exists. On the demand side, the operating rate of leading aluminum processing companies increased slightly by 0.1 percentage points month-on-month to 60.0%. On the inventory side, SMM's domestic electrolytic aluminum society stocks 875,000 tons, up from 23,000 tons last Thursday. Recommended targets: Yunlu Co., Ltd., Tianshan Aluminum, China Hongqiao, Shenhuo Co., Ltd.; related targets: China Aluminum, Innovative Industries.

Tin: Supply disturbances continue to lift prices

The shutdown of Yinman Mining remains unresolved. The upper limit for resuming production in Wa State is still limited, and the pattern of tight supply on the mining side continues; demand maintained off-season characteristics, and domestic social inventories continued to rise during the week, but LME inventories were still at a historically low level, providing support for tin prices. On the stock side, focus on resource-type targets with high tin resource reserves and room for future production growth. Recommended targets: Tin Industry Co., Ltd., Huaxi Nonferrous.

Energy metals: the pattern of tight supply and demand remains unchanged, and strong reality catalyzes prices to continue to rise

Lithium Carbonate: Lithium carbonate production increased last week, stocks continued to be removed, and total stocks are not high. The prospects for resuming production at the Jiangxi Big Mine on the supply side are still uncertain. The Zimbabwean concentrate is gradually arriving in Hong Kong, and the increase in supply has already been fed back into the price. Demand-side production schedules continued to rise month-on-month. As inventories were drastically removed and strong realistic transactions started, expectations of weak long-term demand became secondary logic. If demand is too bearish, it will lower supply-side expectations for increased production. Recommended targets: Shengxin Lithium Energy, Zangge Mining, Ganfeng Lithium, Tianqi Lithium. Nickel sector: Refined nickel stocks have been eliminated. Indonesia's quota for the second batch of nickel ore is still unclear. The balance between nickel supply and demand is relaxed, and the nickel price center is expected to slowly move upward. Recommended target: Huayou Cobalt; Related target: Grimmie.

Rare earths: prices fluctuate upward

In the short term, as the off-peak season changes, demand for downstream inventory replenishment is expected to pick up, and prices are still expected to rise. Looking at the medium- to long-term outlook, the bank continues to be optimistic about the investment value of rare earths as a key strategic resource, and recommends targets: medium to rare colors and permanent magnets with gold strength.

Strategic small metals: strategic value highlighted

Tungsten: Tightening supply combined with global order restructuring, the tungsten sector's boom is expected to continue to recover. Recently, production of some small tungsten ores has been reduced and production has been reduced, and tungsten concentrate prices have risen again; at the same time, the peak season of September-October is approaching, and demand for downstream replenishment is expected to improve. The export side is affected by regulations to accelerate the transformation to high-value-added deep-processing products. Continued price increases for overseas tools and restrictions on the supply of high-end Japanese tungsten materials are also expected to drive the transfer of orders to the domestic market. The stock side continues to pay attention to the direction of “resources+deep processing+domestic substitution”. Recommended targets: Chinatungsten Hi-Tech, Xiamen Tungsten Industry, related targets: Jiaxin International Resources. Uranium: The long-term price of natural uranium in July was 95.5 US dollars per pound, the same as the previous month. The gap between supply and demand for uranium persists due to supply rigidity and the development of nuclear power, and uranium prices are expected to continue to rise. Recommended target: China Uranium Industry; Related Target: CGN Mining. Tantalum: A mismatch between supply and demand supports tantalum prices. The global supply of tantalum ore is tight, and the development of emerging industries such as AI is driving demand for terminals. The bank expects tantalum prices to remain high. It is recommended to focus on the release of production capacity of leading companies. Recommended target: Dongfang Tantalum Industry; Related target: Ximei Resources.

Risk warning: Downstream demand is weaker than expected, large supply-side releases, and the Fed's interest rate cut falls short of expectations.