US inflation data is scheduled for release at 8:30 PM Beijing time tonight (September 11), potentially influencing the Fed's September rate decision next week (September 15-16) and whether pressure on the financial attributes of nonferrous metals eases. With key overseas data and policy windows approaching, global risk aversion has intensified, and today (September 11) major A-share indices all pulled back, with the nonferrous metals sector leading the decline. Copper industry leaders fell sharply, with Northern Copper hitting the daily limit down.

In response, Huaba Fund quickly analyzed the situation, suggesting today's correction may be sentiment-driven volatility triggered by three converging disturbances, not a reversal in industry fundamentals. With US inflation data imminent and the Fed meeting approaching, excessive pessimism is unwarranted. The short-term pullback may actually present a quality opportunity to accumulate positions at lower levels, as the medium-to-long-term logic for the nonferrous sector remains solid.

Why the Nonferrous Sector Is Pulling Back: Three Disturbances Converging

Today's correction in the nonferrous sector does not reflect weakening industry fundamentals, but rather market volatility triggered by three factors: policy expectations, inflation data, and overseas liquidity conditions.

1. Uncertainty over Refined Copper Tariff Policy

News from last night (September 10) indicated the US White House has not yet finalized its refined copper tariff policy, with relevant departments still assessing the impact of tariffs on inflation and the mining industry. The recent sharp rise in copper prices was partly driven by tariff expectations, but with the policy pace slowing, the sentiment supporting copper prices has loosened.

2. US PPI Exceeds Expectations, Rate Hike Bets Surge

Data from the US Bureau of Labor Statistics, also released Thursday (September 10), showed August PPI rising 5.4% year-on-year, above the expected 5.3% and accelerating notably from the prior 4.7%. This has raised concerns that tonight's CPI reading could also exceed expectations, further reinforcing inflation-suppression pressures. Following the data release, traders raised the odds of a September rate hike to above 70% and have fully priced in a first hike by October at the latest.

3. Rising Expectations for Tighter Overseas Liquidity

The European Central Bank's 25 basis point rate hike, coupled with growing expectations of a Japanese rate increase, keeps monetary policy across major global economies in a tightening stance. Risk assets worldwide are under pressure, creating short-term headwinds for dollar-denominated nonferrous metals.

Looking Past Short-Term Noise: Core Supply-Demand Fundamentals Remain Firm

Short-term macro sentiment fluctuations cannot alter the medium-to-long-term supply-demand landscape of the nonferrous sector. Today's pullback contains a clear element of sentiment-driven overselling.

1. The Copper Tariff Delay Alone Does Not Justify a Major Drawdown

The US postponement of a decision on refined copper tariffs appears more like a phased calculation by the administration ahead of the midterm elections, rather than an indication that tariffs will ultimately be shelved. Medium-to-long-term trade policy uncertainty persists, and the logic supporting a price floor for copper remains intact. Additionally, while the US is currently in a phase of inventory building, global stockpiles continue to decline slowly. The core supply-demand tightness has not reversed, providing solid fundamental support for sector prices.

2. The Broader Selloff Is Driven by Stronger-Than-Expected PPI and Overseas Rate Hike Expectations

A closer look at the data shows August's year-on-year PPI beat was mainly driven by crude oil prices. Excluding energy and food, core PPI rose only 0.2% month-on-month, below the expected 0.3%. Therefore, drawing direct conclusions about tonight's CPI from PPI alone is difficult, and there may be room for short-term panic sentiment to correct.

Strategy Going Forward: Avoid Emotional Trading, Consider Building Positions on Dips for the Long Term

Huaba Fund points out that current market volatility stems mainly from capital waiting on the sidelines and sentiment-driven positioning ahead of key events, not from a collapse in industry logic. On an operational level, investors are advised to stay rational, avoid emotional trading, and patiently wait for macro uncertainties to fully play out.

In the new market phase following the Fed's September meeting and ahead of the US November midterm elections, valuation recovery and fundamental growth logic in the nonferrous sector are likely to gradually reassert themselves. Overall, the short-term correction is solidifying the sector's bottom, and the medium-to-long-term allocation value of nonferrous metals remains attractive.

In the Era of Computing Power, Nonferrous Metals Provide the Foundation

Different nonferrous metals vary in their prosperity cycles, pace, and drivers, making divergence inevitable. For investors bullish on the nonferrous sector, a relatively simple approach is to gain full-segment coverage to better capture the sector's beta. The benchmark index of Nonferrous Metals ETF Huabao (159876) and its feeder funds (Class A: 017140, Class C: 017141) comprehensively covers industry leaders in copper, aluminum, rare earths, gold, lithium, tungsten, molybdenum, and tin, including weighted holdings such as Zijin Mining, Luoyang Molybdenum, China Northern Rare Earth, Chifeng Gold, and Aluminum Corporation of China. With full coverage across precious metals, industrial metals, energy metals, and strategic minor metals, the ETF is well-positioned to capture sector-wide beta.

According to interim 2026 results, all 60 constituent stocks of the ETF were profitable, with nearly half (28 stocks) seeing net profit attributable to parent grow over 100% year-on-year, providing solid fundamental support. The ETF holds notably more constituents than similar nonferrous indices (typically 30-50 stocks), allowing broader coverage of semiconductor and new materials directions, making it a one-click allocation tool for investors bullish on both tech and nonferrous metals. Additionally, the ETF is a margin trading target, serving as an efficient instrument for one-click exposure to the nonferrous metals sector.

Source: Shanghai and Shenzhen Stock Exchanges, etc., as of 2026.9.11. Note: The individual stocks mentioned herein are constituent stocks of the benchmark index of Nonferrous Metals ETF Huabao (159876). As of end-August, their weights were: Zijin Mining, 11.14%; Luoyang Molybdenum, 7.12%; China Northern Rare Earth, 4.4%; Chifeng Gold, 3.33%; and Aluminum Corporation of China, 3.31%. Constituent stocks are shown for illustrative purposes only, and any mention of individual stocks does not constitute investment advice nor represents the holdings or trading activities of any fund managed by the firm.

ETF fee notes: When subscribing or redeeming fund shares, the subscription/redemption agent may charge a commission of up to 0.5%. On-exchange trading fees are subject to actual charges by securities firms. The ETF does not charge a sales service fee. Feeder fund fee notes: For the Huabao CSI Nonferrous Metals ETF Feeder Fund (Class A), the subscription fee is RMB 1,000 per transaction for subscriptions of RMB 2 million (inclusive) or above, 0.6% for amounts between RMB 1 million (inclusive) and RMB 2 million, and 1% for amounts below RMB 1 million. The redemption fee is 1.5% for holdings held less than 7 days and 0% for holdings held 7 days (inclusive) or more, with no sales service fee. For the Huabao CSI Nonferrous Metals ETF Feeder Fund (Class C), no subscription fee is charged; the redemption fee is 1.5% for holdings held less than 7 days and 0% for holdings held 7 days (inclusive) or more; the sales service fee is 0.3%.

Risk disclosure: Nonferrous Metals ETF Huabao passively tracks the CSI Nonferrous Metals Index, with a base date of 2013.12.31 and published on 2015.7.13. Constituent stocks may be adjusted periodically according to the index methodology, and historical backtested performance does not indicate future index performance. The fund risk level assessed by the fund manager is R3-medium risk, suitable for balanced (C3) and above investors. Please refer to the sales institution for suitability matching advice. Any information appearing herein (including but not limited to individual stocks, comments, forecasts, charts, indicators, theories, or any form of expression) is for reference only. Investors are solely responsible for their own investment decisions. Additionally, any views, analysis, or forecasts in this article do not constitute investment advice to readers, nor shall any liability be assumed for direct or indirect losses arising from the use of this content. Fund investment involves risks. Past performance of a fund does not represent its future performance, and the performance of other funds managed by the fund manager does not constitute a guarantee of this fund's performance. Please invest with caution.