Northeast Securities: US CPI exceeds expectations+Middle East geopolitical disturbances keep gold and copper strong

The Zhitong Finance App learned that Northeast Securities published a research report saying that the US CPI for September exceeded expectations, but initial jobless claims data showed that employment was still under pressure. Against the backdrop of the Federal Reserve starting a cycle of interest rate cuts and refocusing on employment risks, a rebound in inflation is actually not a bad thing for gold prices. Geographical tension continues in the Middle East, and geopolitical sentiment also supports gold prices, and continues to be optimistic about the medium-term trend of gold prices; in the long run, against the backdrop of global fiat depreciation, geographical conflict, and increased economic uncertainty, the value of gold price allocation is prominent. On the copper side, the macro trend is still going well, the supply logic is being strengthened, and the allocation value of copper ore stocks continues to be optimistic.

Gold: The US CPI exceeded expectations in September, the geographical situation in the Middle East is tense, and the price of gold continues to be strong. London gold now closed at 2657.03 US dollars/ounce this Friday, up 0.1% weekly.

1) The US CPI for September exceeded expectations, but initial unemployment claims data showed that employment was still under pressure: on the evening of 10/10, the US released CPI data for September, with CPI 0.2% month-on-month, 0.2%, 2.4% YoY, 2.3%, previous 2.5%; core CPI 0.3% month-on-month, 0.2%, previous value 0.3%, core CPI 3.3% YoY, higher than forecast 3.2%, and previous value 3.2%. Overall, CPI rebounded month-on-month, and the year-on-year reading maintained a downward trend, with slight structural changes. On the one hand, core commodity inflation turned positive month-on-month, rebounding from -1.7% to -1.2% year on year in September, and judging from the leading Manheim used car price index, the CPI for core products may continue to rise year on year in the next 2-3 months. At the same time, core service inflation will remain strong, continuing to rebound month-on-month, and rebounding slightly year-on-year; but on the other hand, housing inflation fell from 0.5% to 0.2% month-on-month (the previous fluctuation range was generally 0.3-0.5%) and 5.2% yoy It fell to 4.8%, cooling down the CPI data. If housing inflation does not continue to weaken in the future, there may be potential inflationary pressure in the US. Meanwhile, on the evening of 10/10, the US announced that the number of initial jobless claims was 258,000, higher than the forecast of 230,000 and the previous value of 225,000, indicating that the job market is still under slowing pressure (although this data was disrupted by Hurricane Helene). Taken together, against the backdrop of the Federal Reserve starting a cycle of interest rate cuts and refocusing on employment risks, a rebound in inflation is actually not a bad thing for gold prices.

2) Continued geographical tension in the Middle East: Relations between Iran and Israel gradually became strained following the attack on Hamas leader Haniya in late July and the death of Lebanese Hezbollah leader Nasrallah in an Israeli air strike at the end of September. In the early morning of 10/2, Iran launched an attack on Israel with about 200 missiles. Afterwards, Israeli officials said they were seeking major retaliation against Iran and that the target might be Iran's oil production facilities. On 10/12, US officials reported that Israel had narrowed the scope of the attack on Iran. Military and energy infrastructure may become targets, and that they may act at any time, and geopolitical sentiment also supported the price of gold. Continue to be optimistic about the medium-term trend of gold prices. In the long run, against the backdrop of global fiat currency depreciation, geographical conflict, and increased economic uncertainty, the value of gold price allocation is prominent.

Related targets: Zijin Mining (601899.SH), Shandong Gold (600547.SH), Yintai Gold (000975.SZ), Chifeng Gold (600988.SH), Hunan Gold (002155.SZ), China Gold (), Western Gold (Dubai), Zhaojin Mining (01818), Hengbang Co., Ltd. (002237.SZ), Pengxin Resources (), etc. 600489.SH 601069.SH 600490.SH

Copper: The macro trend is still going well, the supply logic is being strengthened, and the allocation value of copper ore stocks continues to be optimistic. 1) Macro sentiment cooled briefly, and copper price resilience was highlighted: the market's expectations for the Fed's interest rate cut in November were gradually revised from 50 bp to 25 bps, compounded by a cooling of optimism about domestic stimulus policies. This week, copper prices slightly pulled back from around 10,000 US dollars/ton to a low of 9,606 US dollars/ton, closing at 9,803 US dollars/ton. The macroeconomic downturn at home and abroad is still ongoing, and it is expected that the recovery will once again provide trading opportunities. 2) Domestic electric copper production declined in September, and new smelting capacity slowed down: SMM data showed that domestic electric copper production in September was 1.043 million tons, -0.9% month-on-month and -0.8% year-on-year, and the decline in production was realized. Some smelters delayed their plans to start production due to difficulties in procuring raw materials. 3) The copper price center is rising, and we continue to be optimistic about the equity side allocation value of copper ore: Under the soft landing assumption, the copper price center is difficult to recover drastically. The bullish logic remains unchanged in the medium to long term, and the copper price center is upward, and emphasis is placed on the equity side allocation value.

Related targets: Zijin Mining (601899.SH), Luoyang Molybdenum (603993.SH), Western Mining (601168.SH), Jiangxi Copper (), Jin Chengxin (USD), Tongling Nonferrous (000630.SZ), Minmetals Resources (01208), etc. 600362.SH 603979.SH

Risk warning: US inflation continues to exceed expectations, global monetary tightening exceeds expectations, and the dollar appreciates.