TF SECURITIES: The expectation of interest rate cuts combined with risk aversion sentiment supports the rise in gold prices

According to the Zhitong Finance APP, TF SECURITIES released a research report stating that at the beginning of the week, the better-than-expected data on initial jobless claims and home sales in the United States reduced the market's judgment on the cooling of the U.S. economy, leading to a consecutive rise in the dollar, which suppressed the upward space for gold prices. However, the uncertainty of geopolitical and economic factors remains, and gold prices are still supported by bargain hunting and safe-haven buying. Subsequently, the significant decline in the U.S. consumer confidence index dragged down the dollar and U.S. Treasury yields, coupled with concerns in the market triggered by the Trump administration's decision on auto tariffs, the uncertainty of its policies prompted funds to accelerate inflow into the gold market. Although some countries may receive exemptions, the specific implementation time and scope of the tariff policy remain unclear, and the cautious sentiment in the market provides direct support for gold.

The main points of TF SECURITIES are as follows:

Base Metals: Copper prices rise and fall, inventory reduction slows down

1) Copper: Copper prices fell, with Shanghai copper closing at 80,450 yuan/ton. On the macro front, disturbances to copper prices remain this week, as Trump may impose a 25% tariff on copper, causing COMEX copper prices to soar to historical highs. In addition, the U.S. announced a 25% tariff on imported cars, which hinders the global flow of goods. On Thursday, Federal Reserve officials warned that trade barriers would exacerbate imported inflationary pressures, and the dollar strengthened, suppressing commodity prices, putting downward pressure on copper prices. Domestically, policies continue to exert force, with the Ministry of Commerce holding a special press conference on expanding consumption, introducing pilot reforms for automobile circulation consumption, and implementing targeted measures for outbound tax refunds.

On the fundamental side, a force majeure event occurred at the Altonorte smelter in Chile, coupled with a tightening global copper mine supply situation, providing support for copper prices. However, under the recent high copper prices, end-user copper enterprises are cautious about high prices and maintain just-in-time demand, leading to a slow reduction in social inventory. The mixed macro news has caused intense fluctuations in copper prices. As the Qingming Festival approaches next week, downstream may have certain replenishment needs, and it is expected that copper prices may stabilize with limited downside.

2) Aluminum: This week (March 21, 2025 - March 27, 2025), aluminum prices fell, with Shanghai aluminum closing at 20,580 yuan/ton. The price of alumina continues to decline, and the market for aluminum ingots is sluggish, coupled with the continuous decline in overseas aluminum prices, leading to a drop in the average spot aluminum price this week. On the supply side: this week, electrolytic aluminum enterprises mainly increased production, concentrated in Sichuan, Xinjiang, and Qinghai regions, with continued increases in electrolytic aluminum supply. On the demand side: this week, the theoretical output of the aluminum plate industry increased, with the increment concentrated in Guangxi, while the theoretical output of the aluminum rod industry decreased, with the decrement concentrated in Inner Mongolia.

Overall, the theoretical demand changes for electrolytic aluminum are limited. On the macro front, this week the state released multiple policies to boost consumption, demonstrating the country's determination to drive consumption growth. On the inventory side: this week, LME aluminum inventory decreased compared to last week, currently at 473,100 tons, down 16,000 tons from last week's 489,100 tons. In China, this week, social inventory of aluminum ingots continued to decrease, currently at 837,000 tons, down 25,100 tons from last week's 862,100 tons.

Recommended attention: Zhongfu Industrial (600595.SH), Shenhuo Co., Ltd. (000933.SZ), Yun Aluminum Co., Ltd. (000807.SZ), China Hongqiao (01378), Zijin Mining (601899.SH), Luoyang Molybdenum Co., Ltd. (603993.SH), Jincheng Mining (603979.SH), China Minmetals Resources (01208).

Precious Metals: Interest Rate Cut Expectations + Safe-Haven Sentiment Resonance Drive Gold Prices Up This Week

As of March 28, the domestic average market price of 99.95% gold is 711.19 yuan/gram, an increase of 0.97% compared to last week's average price. The average market price of silver in China is 8,330 yuan/kilogram, a decrease of 0.19% compared to last week's average price.

At the beginning of the week, better-than-expected data on initial jobless claims and home sales in the U.S. reduced market judgments on the cooling of the U.S. economy, leading to consecutive gains in the dollar, which suppressed the upward space for gold prices. However, geopolitical and economic uncertainties persist, and gold prices are still supported by bargain hunting and safe-haven buying. Subsequently, a significant drop in the U.S. consumer confidence index dragged down the dollar and U.S. Treasury yields, compounded by concerns over the Trump administration's decision on auto tariffs, which accelerated capital inflows into the gold market due to policy uncertainties. Although some countries may receive exemptions, the specific implementation time and scope of the tariff policy remain unclear, and the market's cautious sentiment provides direct support for gold.

Recommended Focus: Shandong Gold International (000975.SZ), Zhaojin Mining (01818), China Gold International (02099), Shandong Gold (600547.SH), Chifeng Jilong Gold Mining (600988.SH).

Minor Metals: Increasing Safe-Haven Sentiment in Overseas Markets, Tin Prices Weaken

During the week, the central bank once again released favorable expectations, and the domestic macro environment is relatively warm. However, the U.S. March S&P Global Composite PMI preliminary value exceeded expectations, and the uncertainty of Trump's tariff policy has also intensified market safe-haven sentiment. The Wa State has clarified that the Manxiang mining area can orderly resume production after handling relevant procedures, but this news still suppresses the tin price trends both domestically and internationally, leading to a slight decline in the overall tin price this week.

Rare Earth Permanent Magnets: Prices Rise Significantly Due to Earthquake in Myanmar

Due to the earthquake on Friday, the already fragile supply from Myanmar faced further setbacks, causing the price of praseodymium and neodymium in Wuxi to rise by nearly 5,000 yuan/ton. In the spot market, the price of light rare earth oxide praseodymium and neodymium reached 434,000 yuan/ton this week; the price of medium and heavy rare earth oxide dysprosium decreased by 1.3% to 1,712,300 yuan/ton. The sudden event may disrupt the previously agreed inventory release from Myanmar mines, and the overall tension in the mining sector has not changed, with downstream mining sources tight and demand entering the peak season in the first half of the year. The price center of rare earths is rising, while the equity side has not fully reflected this. Looking ahead, the rare earth sector is entering a period of "fundamental + sentiment" resonance upwards, and it is essential to pay enough attention to the "strategic opportunities" in the sector. At the same time, magnetic materials will benefit from investment opportunities in industries represented by robotics from "0 to 1."

Key companies to focus on: Core companies in the sector include Guangxi Nonferrous Metals Group (600259.SH), China Rare Earth (000831.SZ), Northern Rare Earth (600111.SH), and leading companies in the magnetic materials field such as Jinli Permanent Magnet (300748.SZ), Zhenghai Magnetic Materials (300224.SZ), and Ningbo Yunsheng (600366.SH).

Risk Warning

Risks of demand recovery falling short of expectations, risks of significant increases in upstream supply, and risks of substantial inventory increases