Precious metals surged and then retreated; the Huaxia Non-ferrous Metals ETF (516650) fell by 0.17%

On July 30, influenced by the Federal Reserve's decision to keep interest rates unchanged at its policy meeting, precious metals saw a rebound in early trading before gradually pulling back. As of 13:30, Huaxia Non-ferrous Metals ETF (516650) fell by 0.17%, with top gainer Huafeng Aluminum rising 4.64%. Shanjing International rose 3.96%, Western Gold gained 3.16%, Shenhuo Shares increased 3.11%, and Tianshan Aluminum climbed 2.99%. Yunnan Germanium led the decliners, falling 6.39%, while Hailiang Shares dropped 5.35%. Shares such as Shengtun Mining, Guocheng Mining, and Xiamen Tungsten also declined, with Huaxia Industrial Non-ferrous Metals ETF (515040) down 0.80%.

Data from the China Nonferrous Metals Industry Association on July 29 showed that the half-year gains for three core minor metals—tin, tantalum, and indium—surpassed 40%, 158%, and 60%, respectively. Prices of bulk commodities like copper and aluminum remained at high levels. From January to June, copper and aluminum prices rose by 31.4% and 18.8%, respectively. On the demand side, tin, tantalum, and indium face irreplaceable physical consumption in sectors such as AI servers, high-speed optical modules, and advanced packaging, with global cloud providers continuing to expand their AI capital expenditures.

CSC Futures noted that the overall rebound in precious metals in the morning was mainly driven by the FOMC's decision to maintain interest rates. The July FOMC meeting held overnight saw the Fed hold rates steady, prompting a quick intraday rebound in precious metals. However, they pulled back later due to hawkish comments from Waller. Three FOMC officials still voted for a rate hike at this meeting, highlighting continued divergence within the Fed. The likelihood of future rate hikes remains significant, adding pressure to precious metals. Additionally, Iran expressed dissatisfaction with not securing full control of the straits in US-Iran negotiations and launched further strikes against US military targets, creating further volatility for precious metals. Overall, while the Fed's decision to hold rates slightly eased pressure on precious metals, Waller's hawkish stance suggests future hikes are still possible, limiting short-term upside potential. Operationally, we suggest waiting and observing.

Huaxia Non-ferrous Metals ETF (516650, OTC feeder funds: 016707/016708/021534) closely tracks the CSI Sub-sector Non-ferrous Metals Industry Theme Index. It is the largest ETF tracking this index, focusing on gold and industrial metals like copper and aluminum, minor metals such as rare earths, tungsten, and molybdenum, and energy metals like lithium and cobalt. Copper accounts for 32.3%, gold and copper combined for 41.5%, and gold, copper, and aluminum together make up 52.17% of the weight—the highest in the sector. Computing metal content stands at 56.68%, also the highest among similar indices, helping investors gain one-click exposure to the non-ferrous metals sector!

Huaxia Industrial Non-ferrous Metals ETF (515040) focuses on industrial metals like copper, aluminum, lead, and zinc, which account for over 51% of its holdings. It is suitable for those bullish on the manufacturing recovery and seeking pure industrial exposure, offering the lowest fee ratio in its category!