BofAS Identifies Leading Aluminum Stock Picks for 'Year of the Fire Horse'; Less Emphasis on Building/Solar Materials; Favorites Include Chalco, Zijin, Hongqiao, Shandong Gold, and Ganfeng
Market Outlook for 2026: BofA Securities predicts that the "Year of the Fire Horse" will favor electrification and AI power infrastructure in the Chinese basic metals market, with a focus on aluminum, gold, copper, lithium, and cobalt stocks.
Stock Recommendations: The broker recommends buying aluminum stocks and has a positive outlook on gold, copper, lithium, and cobalt, while being neutral on coal and bearish on solar energy and building materials due to weak demand and declining profit margins.
Top Stock Picks: BofA's top stock picks include CHALCO, ZIJIN MINING, CHINAHONGQIAO, SD GOLD, and GANFENGLITHIUM, with varying short selling ratios indicating market sentiment.
Underperforming Stocks: Key underperformers identified include TONGWEI, XINYI SOLAR, ANGANG STEEL, and CR BLDG MAT TEC, with significant short selling ratios reflecting investor caution.
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ANGANG STEEL Expects 2025 Loss to Decrease to Approximately RMB 4.1 Billion
Stock Performance: ANGANG STEEL (00347.HK) experienced a decline of 4.455%, with a drop of 0.090 in its stock price.
Short Selling Activity: The company saw short selling amounting to $2.87 million, with a short selling ratio of 4.479%.
Financial Forecast: ANGANG STEEL predicts a net loss of approximately RMB4.077 billion for the year ending December 31, 2025.
Comparison to Previous Year: This forecast represents a 42.75% decrease from the loss of RMB7.122 billion reported in 2024.
<BofAS Analysis> Ratings and Price Targets for Gold Mining Companies (Table)
Chinese Metal Stocks Performance: Several Chinese metal stocks, including Zijin Mining and Jiangxi Copper, received "Buy" ratings with target price increases, while others like Chalco and Ganfeng Lithium saw declines in stock prices.
Short Selling Data: The short selling ratios for various stocks indicate significant market activity, with some stocks like Angang Steel experiencing high short selling ratios, suggesting bearish sentiment.
Chinese Cement and Glass Stocks: Cement stocks like Conch Cement maintained their "Buy" ratings despite minor price drops, while Xinyi Glass faced a notable decline in stock price and a "Buy" rating.
Chinese Solar and Battery Materials Stocks: Xinyi Solar was rated as "Underperform" with unchanged target prices, while Yunnan Energy received a "Buy" rating with a significant target price increase.
BofAS Identifies Leading Aluminum Stock Picks for 'Year of the Fire Horse'; Less Emphasis on Building/Solar Materials; Favorites Include Chalco, Zijin, Hongqiao, Shandong Gold, and Ganfeng
Market Outlook for 2026: BofA Securities predicts that the "Year of the Fire Horse" will favor electrification and AI power infrastructure in the Chinese basic metals market, with a focus on aluminum, gold, copper, lithium, and cobalt stocks.
Stock Recommendations: The broker recommends buying aluminum stocks and has a positive outlook on gold, copper, lithium, and cobalt, while being neutral on coal and bearish on solar energy and building materials due to weak demand and declining profit margins.
Top Stock Picks: BofA's top stock picks include CHALCO, ZIJIN MINING, CHINAHONGQIAO, SD GOLD, and GANFENGLITHIUM, with varying short selling ratios indicating market sentiment.
Underperforming Stocks: Key underperformers identified include TONGWEI, XINYI SOLAR, ANGANG STEEL, and CR BLDG MAT TEC, with significant short selling ratios reflecting investor caution.
<Study> JPM Ratings and Price Targets for Gold Mining Companies (Table)
Stock Ratings Overview: Several companies in the mining and energy sectors received updated ratings, with ZIJIN MINING and CMOC rated as "Overweight," while JIANGXI COPPER was upgraded from "Underweight" to "Neutral."
Short Selling Activity: Notable short selling activity was reported for various stocks, including ZIJIN MINING and CHINAHONGQIAO, with short selling ratios indicating significant market interest.
Price Target Adjustments: Price targets for ZIJIN MINING and CMOC were raised, reflecting positive market sentiment, while JIANGXI COPPER's target was also increased, indicating a shift in investor outlook.
Market Performance: The overall market performance showed mixed results, with some stocks like GANFENG LITHIUM and TIANQI LITHIUM experiencing gains, while others like CHALCO and YANKUANG ENERGY faced declines.
JPM Maintains Preference for Copper and Gold; ZIJIN MINING Stays as Preferred Choice
JP Morgan's Sector Preference: JP Morgan ranks the basic materials sector for 2026 as Copper/Gold > Aluminum > Lithium > Coal > Steel, anticipating continued outperformance of MSCI China Materials over MSCI China due to supply disruptions and M&As.
JIANGXI COPPER Rating Upgrade: The rating for JIANGXI COPPER was upgraded to Neutral based on a positive outlook for copper, while Chinese policies are seen as key drivers of commodity prices, with milder-than-expected implementation of the "anti-involution" policy.
Steel Sector Challenges: Due to ongoing efforts to reduce excess capacity, steel profit margins are expected to remain low, leading to downgrades for BAO IRON to Neutral and ANGANG STEEL to Underweight.
Morgan Stanley's Top Picks: ZIJIN MINING is highlighted as Morgan Stanley's top pick for the year, with continued favor for CMOC, CHALCO, and CHINAHONGQIAO amidst significant short selling activity in these stocks.
G Sachs: China's Steel Capacity Cuts Lag Behind Projections; Steel Stocks Anticipate Long-Term Profit Decline
China's Steel Industry Outlook: Goldman Sachs predicts a prolonged profit slump for Mainland steel mills due to slower capacity reduction and high steel exports, leading to moderate price improvements.
Earnings Forecast Adjustments: The firm has lowered earnings forecasts for BAO IRON and MAANSHAN IRON, while also anticipating deeper losses for ANGANG STEEL over the next two years.
Short Selling Activity: There is notable short selling activity in the steel sector, with significant amounts reported for BAO IRON, MAANSHAN IRON, and ANGANG STEEL.
Long-term Capacity Goals: Despite current challenges in meeting ultra-low emission standards, Goldman Sachs maintains that the long-term goal of reducing capacity in the steel industry remains achievable.
ANGANG STEEL Expects 2025 Loss to Decrease to Approximately RMB 4.1 Billion
Stock Performance: ANGANG STEEL (00347.HK) experienced a decline of 4.455%, with a drop of 0.090 in its stock price.
Short Selling Activity: The company saw short selling amounting to $2.87 million, with a short selling ratio of 4.479%.
Financial Forecast: ANGANG STEEL predicts a net loss of approximately RMB4.077 billion for the year ending December 31, 2025.
Comparison to Previous Year: This forecast represents a 42.75% decrease from the loss of RMB7.122 billion reported in 2024.
<BofAS Analysis> Ratings and Price Targets for Gold Mining Companies (Table)
Chinese Metal Stocks Performance: Several Chinese metal stocks, including Zijin Mining and Jiangxi Copper, received "Buy" ratings with target price increases, while others like Chalco and Ganfeng Lithium saw declines in stock prices.
Short Selling Data: The short selling ratios for various stocks indicate significant market activity, with some stocks like Angang Steel experiencing high short selling ratios, suggesting bearish sentiment.
Chinese Cement and Glass Stocks: Cement stocks like Conch Cement maintained their "Buy" ratings despite minor price drops, while Xinyi Glass faced a notable decline in stock price and a "Buy" rating.
Chinese Solar and Battery Materials Stocks: Xinyi Solar was rated as "Underperform" with unchanged target prices, while Yunnan Energy received a "Buy" rating with a significant target price increase.
BofAS Identifies Leading Aluminum Stock Picks for 'Year of the Fire Horse'; Less Emphasis on Building/Solar Materials; Favorites Include Chalco, Zijin, Hongqiao, Shandong Gold, and Ganfeng
Market Outlook for 2026: BofA Securities predicts that the "Year of the Fire Horse" will favor electrification and AI power infrastructure in the Chinese basic metals market, with a focus on aluminum, gold, copper, lithium, and cobalt stocks.
Stock Recommendations: The broker recommends buying aluminum stocks and has a positive outlook on gold, copper, lithium, and cobalt, while being neutral on coal and bearish on solar energy and building materials due to weak demand and declining profit margins.
Top Stock Picks: BofA's top stock picks include CHALCO, ZIJIN MINING, CHINAHONGQIAO, SD GOLD, and GANFENGLITHIUM, with varying short selling ratios indicating market sentiment.
Underperforming Stocks: Key underperformers identified include TONGWEI, XINYI SOLAR, ANGANG STEEL, and CR BLDG MAT TEC, with significant short selling ratios reflecting investor caution.
<Study> JPM Ratings and Price Targets for Gold Mining Companies (Table)
Stock Ratings Overview: Several companies in the mining and energy sectors received updated ratings, with ZIJIN MINING and CMOC rated as "Overweight," while JIANGXI COPPER was upgraded from "Underweight" to "Neutral."
Short Selling Activity: Notable short selling activity was reported for various stocks, including ZIJIN MINING and CHINAHONGQIAO, with short selling ratios indicating significant market interest.
Price Target Adjustments: Price targets for ZIJIN MINING and CMOC were raised, reflecting positive market sentiment, while JIANGXI COPPER's target was also increased, indicating a shift in investor outlook.
Market Performance: The overall market performance showed mixed results, with some stocks like GANFENG LITHIUM and TIANQI LITHIUM experiencing gains, while others like CHALCO and YANKUANG ENERGY faced declines.
JPM Maintains Preference for Copper and Gold; ZIJIN MINING Stays as Preferred Choice
JP Morgan's Sector Preference: JP Morgan ranks the basic materials sector for 2026 as Copper/Gold > Aluminum > Lithium > Coal > Steel, anticipating continued outperformance of MSCI China Materials over MSCI China due to supply disruptions and M&As.
JIANGXI COPPER Rating Upgrade: The rating for JIANGXI COPPER was upgraded to Neutral based on a positive outlook for copper, while Chinese policies are seen as key drivers of commodity prices, with milder-than-expected implementation of the "anti-involution" policy.
Steel Sector Challenges: Due to ongoing efforts to reduce excess capacity, steel profit margins are expected to remain low, leading to downgrades for BAO IRON to Neutral and ANGANG STEEL to Underweight.
Morgan Stanley's Top Picks: ZIJIN MINING is highlighted as Morgan Stanley's top pick for the year, with continued favor for CMOC, CHALCO, and CHINAHONGQIAO amidst significant short selling activity in these stocks.
G Sachs: China's Steel Capacity Cuts Lag Behind Projections; Steel Stocks Anticipate Long-Term Profit Decline
China's Steel Industry Outlook: Goldman Sachs predicts a prolonged profit slump for Mainland steel mills due to slower capacity reduction and high steel exports, leading to moderate price improvements.
Earnings Forecast Adjustments: The firm has lowered earnings forecasts for BAO IRON and MAANSHAN IRON, while also anticipating deeper losses for ANGANG STEEL over the next two years.
Short Selling Activity: There is notable short selling activity in the steel sector, with significant amounts reported for BAO IRON, MAANSHAN IRON, and ANGANG STEEL.
Long-term Capacity Goals: Despite current challenges in meeting ultra-low emission standards, Goldman Sachs maintains that the long-term goal of reducing capacity in the steel industry remains achievable.
