Goldman Sachs analysts noted in a Monday report that the Chinese yuan has demonstrated resilience amid the China-US trade dispute, and its further appreciation is expected to benefit China's stock market. In its latest report, Goldman Sachs wrote that a 1% appreciation of the Chinese yuan against the US dollar could boost Chinese stocks by 3%, driven by factors such as improved corporate earnings prospects and increased foreign capital inflows. The report stated that the outlook for the yuan supports Goldman Sachs' overweight stance on Chinese stocks, and under a scenario of a stronger yuan, consumer discretionary, real estate, and brokerage stocks typically perform well. Goldman Sachs pointed out that the reasons for the yuan's stability during this tariff war include interventions by the People's Bank of China, the enhanced competitiveness and diversification of China's export sector, the undervaluation of the yuan, and the demand for asset diversification following the broad weakness of the US dollar. During the 2018 tariff war in Trump's first term, the yuan depreciated by up to 13% against the US dollar, a stark contrast to its current appreciation. As of press time, the US dollar-yuan exchange rate stood at 7.16804. Goldman Sachs forecasts that the US dollar-yuan exchange rate could reach 7 within the next 12 months. The institution also noted that yuan-denominated assets will continue to attract foreign capital, but the pace of net southbound purchases may slow down in the coming months. The wealthy are taking action As of last Friday, the Hang Seng Index had achieved seven consecutive weeks of gains. Although tariff uncertainties in early April triggered a significant market sell-off, investors' optimism towards Chinese stocks remained unchanged and was further strengthened after China and the US reached a mutual concession agreement. In April, Goldman Sachs twice lowered its forecast for the MSCI China Index, but raised it again in May after tariff risks were contained, increasing its earnings growth forecasts for the index in 2025 and 2026 from 6% and 7% to 9%, and raising the target price for the MSCI China Index over the next 12 months from 78 to 84. Note: Trend of iShares MSCI China ETF Meanwhile, a senior executive at Standard Chartered Bank stated that wealthy investors have not halted their investments due to tariff threats, believing that now is an excellent time to buy Hong Kong and mainland Chinese stocks. Raymond Ang, Global Head of Private Banking and Wealthy Clients for Greater China and North Asia at the bank, told the media that his private banking and wealthy clients are highly active in investing, and have redeemed their long-term fund positions linked to macroeconomic themes or specific sector funds, reallocating funds into Hong Kong and mainland Chinese stocks, as well as high-quality Chinese government bonds.

[ADC12 Price Daily Review] Today, aluminum prices recovered the losses of the previous two days, with SMM A00 aluminum prices surging by 190 yuan from the previous trading day to 20,900 yuan/mt, while secondary aluminum prices encountered resistance in their upward movement. Domestic SMM ADC12 prices remained flat from yesterday, staying within the range of 21,200-21,400 yuan/mt. In the import market, overseas ADC12 prices held firm at a high level near $2,500/mt, and due to the strengthening of the yuan exchange rate, the immediate import loss slightly narrowed to within 200 yuan/mt. Aluminum prices rebounded significantly today, but the secondary aluminum market lacked momentum to follow the increase, with most manufacturers maintaining a wait-and-see stance. Current market demand is weaker than expected, with orders recovering slowly, limiting the upside room for ADC12 prices. As raw material market liquidity improves, cost side support is weakening further. If the recovery in end-use consumption lacks sustainability, coupled with further loosening of cost support, ADC12 prices are expected to face continued resistance to upward adjustments or even downward pressure.

【ADC12 Price Daily Review: Aluminum Prices Rebound Sharply, Secondary Aluminum Price Gains Insufficient】 Today, aluminum prices recovered losses from the previous two days, with SMM A00 aluminum prices surging by 190 yuan to 20,900 yuan/mt compared to the previous trading day, while secondary aluminum prices encountered resistance. Domestically, SMM ADC12 prices remained unchanged from yesterday, staying within the range of 21,200-21,400 yuan/mt. In the import market, overseas ADC12 prices held firm at a high level near $2,500/mt. Due to the strengthening of the yuan exchange rate, immediate import losses slightly narrowed to within 200 yuan/mt. Current market demand is weaker than expected, with a slow rebound in orders, limiting the upside room for ADC12 prices. As raw material market liquidity improves, cost side support is weakening further. If the recovery in end-use consumption lacks sustainability, coupled with further loosening of cost support, ADC12 price adjustments may continue to encounter resistance or face downward pressure.

【ADC12 Price Daily Review: Aluminum Prices Rebound Sharply, Secondary Aluminum Prices Lack Momentum】 Today, aluminum prices recovered the losses of the previous two days, with SMM A00 aluminum prices surging by 190 yuan to 20,900 yuan/mt compared to the previous trading day, while secondary aluminum prices encounter resistance. Domestically, SMM ADC12 prices remained unchanged from yesterday, staying within the range of 21,200-21,400 yuan/mt. In the import market, overseas ADC12 prices held firm at a high level near $2,500/mt. Due to the strengthening of the yuan exchange rate, immediate import losses slightly narrowed to within 200 yuan/mt. Current market demand is weaker than expected, with orders rebounding slowly, limiting the upside room for ADC12 prices. As raw material market liquidity improves, cost side support is weakening further. If the recovery in end-use consumption lacks sustainability, coupled with further loosening of cost support, ADC12 prices are expected to face continued resistance to upward adjustments or even downward pressure.

Driven by the favorable policies from the Two Sessions, market demand for artificial intelligence, consumer electronics, NEVs, and other sectors is expected to grow. Additionally, the market's favor for high-growth tech companies has provided further positive momentum. The gallium nitride (GaN) concept saw a strong opening on March 6. As of 10:09 AM on March 6, the GaN concept index had risen by 2.1%. In terms of individual stocks, Jingquanhua and Aohai Technology hit the daily limit, while North Huachuang, Aglare Technology, and H&T ranked among the top gainers. On the news front, this year's government work report proposed fostering and expanding emerging and future industries, advancing the integrated cluster development of strategic emerging industries, and launching large-scale demonstration actions for new technologies, products, and scenarios. It also emphasized promoting the safe and healthy development of emerging industries such as commercial aerospace and the low-altitude economy, establishing a growth mechanism for future industry investments, and nurturing future industries like bio-manufacturing, quantum technology, embodied intelligence, and 6G.

[SMM Aluminum Morning Meeting Summary: Supporting the Private Economy, Tug-of-War Between Sellers and Buyers Continues Amid Volatile Market] Inventory side, it remained in a post-holiday inventory buildup phase, with inventory expected to continue increasing rapidly this week. Demand side, the operating rate of leading domestic downstream aluminum processing enterprises rebounded significantly this week, up 5.7 percentage points WoW to 56.8%, mainly driven by post-Chinese New Year resumption of production. However, recovery varied across different sectors. Looking ahead, with increasing PV demand and full resumption of work and production by end-users, while supply-side growth remains limited, aluminum prices are expected to maintain a short-term high-level fluctuation.