Non-ferrous metals under short-term pressure, promising outlook ahead? Three major core supports remain solid, Huabao Fund Non-ferrous ETF (159876) attracts 120 million yuan in capital allocation

On Thursday, March 12, all major A-share indices closed in the red. The intra-market price of the Rare Metals ETF (159876), which covers leading companies in the gold, rare earth, copper, aluminum, and other non-ferrous metals industries, rose by 0.43 in the early session before consolidating and pulling back. It ultimately closed down 0.77%. According to Shenzhen Stock Exchange data, this ETF accumulated 1.2 billion yuan in inflows over the past 10 days, reflecting investors’ confidence in the non-ferrous metals sector and their active participation in buying!

Aluminum industry leaders led the gains! Among the top 10 constituents of the non-ferrous ETF (159876), seven are aluminum industry leaders, including Shenhuo Shares, which rose over 6%, China Aluminum, up more than 5%, and Yunnan Aluminum, up over 4%. Additionally, among rare earth leaders, rare metals rose over 4%, and gold leaders such as Chifeng Gold increased by more than 1%. On the other hand, copper giants like Luoyang Molybdenum, lead and zinc leaders Xingye Silver & Tin, and lithium leaders Yongxing Materials declined over 3%, dragging down the index.

Why has the performance of the non-ferrous metals sector not been very impressive recently? On the macro level, amid Middle East geopolitical conflicts, energy prices surged, US inflation heated up, and the Federal Reserve’s rate cut expectations weakened. As the US dollar index rebounded strongly, prices of gold, silver, copper, and other commodities, which are international, faced downward pressure.

It is worth noting that the core supporting logic driving the price center of the non-ferrous metals sector has not changed:

1. The supply-demand tight balance remains unbroken. Over the past few years, global mining capital expenditure has been insufficient for a long time, with very limited new capacity added for key commodities like copper and bauxite. Coupled with frequent geopolitical conflicts and ongoing disruptions at the mining end, rigid supply constraints still exist, and the medium- to long-term supply-demand gap remains clear.

2. Demand from emerging industries has not disappeared. The development of AI computing power drives demand for power infrastructure, and industries such as new energy vehicles, photovoltaics, and wind power are growing rapidly, supporting long-term growth in demand for copper, rare earths, aluminum, and other non-ferrous metals, solidifying the sector’s fundamental value.

3. The global monetary easing trend remains unchanged. Although short-term expectations of Fed rate cuts fluctuate, the market generally expects the Fed to implement 1-2 rate cuts by 2026, providing medium- to long-term support for non-ferrous metal prices.

Looking ahead, Guotai Haitong Securities states that under tight supply and demand, monetary policy, macro expectations, geopolitical games, and supply disruptions will be key factors influencing non-ferrous metal prices. CICC believes that, going forward, rising geopolitical risks and diminishing peace dividends are highly likely, and as the global re-industrialization accelerates, the upward cycle of non-ferrous metals is expected to continue.

【The non-ferrous metals boom has arrived; the “super cycle” is unstoppable】

The Non-Ferrous ETF Hua Bao (159876) and its linked funds (A: 017140, C: 017141) fully cover industries such as copper, aluminum, gold, rare earths, and lithium, including precious metals (hedging), strategic metals (growth), and industrial metals (recovery), spanning different economic cycles. This comprehensive coverage better captures the beta trend of the entire sector. Additionally, this ETF is a margin trading and short-selling target, making it an efficient tool for one-click exposure to the non-ferrous metals sector.

As of the end of February, the non-ferrous ETF Hua Bao (159876) had a latest scale of 2.427 billion yuan, with an average daily trading volume of over 100 million yuan in the past month. Among the three ETFs tracking the same index, it ranks first in both size and liquidity.

Institutional views are based on: ① Guotai Haitong Securities’ March 9 report “Non-Ferrous Metals: Geopolitical Disruptions Do Not Change the Volatile Uptrend”; ② CICC’s March 12 report “Rising Geopolitical Risks and Increased Market Volatility Highlight Resilience of A-shares”.

Note: The intra-market abbreviation of the non-ferrous ETF Hua Bao (159876) was previously “Non-Ferrous Leading ETF.”

ETF fee-related notes: When investors subscribe or redeem fund shares, the agency may charge a commission not exceeding 0.5%. The trading fees on the secondary market are based on the actual charges of the securities firm. The ETF does not charge sales service fees.

Linked fund fee notes: The Huabao CSI Non-Ferrous Metals ETF Initiated Linked Fund (A) has a subscription fee of 1,000 yuan per transaction for subscriptions of 2 million yuan or more, 0.6% for 1-2 million yuan, and 1% for less than 1 million yuan; redemption fees are 1.5% if held for less than 7 days, and 0% if held for 7 days or more, with no sales service fee. The Huabao CSI Non-Ferrous Metals ETF Initiated Linked Fund © has no subscription fee, with redemption fees of 1.5% for holdings under 7 days and 0% for 7 days or more; sales service fee is 0.3%.

Risk warning: The non-ferrous ETF Hua Bao passively tracks the CSI Non-Ferrous Metals Index, which was base date 2013-12-31, published on 2015-07-13. The index’s annual returns over the past five full years are: 2021, 35.89%; 2022, -19.22%; 2023, -10.43%; 2024, 2.96%; 2025, 91.67%. The index components are adjusted periodically according to the index rules. Past backtested performance does not predict future results. The index components shown here are for display only; individual stock descriptions are not investment advice and do not reflect holdings or trading activity of any fund managed by the manager. The fund’s risk level is assessed as R3—medium risk, suitable for balanced (C3) and above investors. Suitability matching opinions are subject to the sales institution. All information in this article (including stocks, comments, forecasts, charts, indicators, theories, and any other forms) is for reference only. Investors are responsible for their own investment decisions. The views, analysis, and forecasts in this article do not constitute investment advice, and the author is not responsible for any direct or indirect losses resulting from the use of this content. Fund investments carry risks; past performance does not guarantee future results, and the performance of other funds managed by the fund manager does not guarantee the performance of any specific fund. Investors should exercise caution.