Commodity Price Impact: Commodity prices have risen significantly, benefiting the basic materials sector in China, particularly suppliers of aluminum, copper, and lithium, with positive ratings for companies like CHALCO and MMG.

Automakers Under Pressure: Rising material costs are expected to increase the production costs for mass-market electric vehicles, with smaller automakers like XPENG and GAC GROUP being more vulnerable compared to larger firms like BYD and Geely.

Battery Industry Outlook: Short-term challenges are anticipated for second-tier battery companies, while CATL is expected to maintain a strong position due to its bargaining power and upcoming production resumption.

Tech Sector Challenges: Xiaomi may face margin pressures from increasing memory costs, which significantly impact the bill of materials for its smartphones, potentially affecting profitability.

Huatai Securities Optimism: Huatai Securities issued a positive report on CMOC (03993.HK), highlighting the company's growth potential in the copper mining industry and its strategic shift towards gold, maintaining a 'Buy' rating.

Target Price Adjustments: The target price for CMOC's A-shares was raised from RMB24.19 to RMB35.83, while the target price for H-shares increased from $21.27 to $33.95, reflecting a bullish outlook on copper and gold prices.

Gold Price Forecasts: Goldman Sachs has increased its gold price forecasts for 2026-27 by 10-16%, predicting average prices of USD4,978 and USD5,585 per ounce for 2026 and 1H27, respectively.

Copper Price Forecasts: The firm also raised its 2026 copper price forecast by 7% to USD12,200 per ton, leading to a 9-33% increase in earnings forecasts for Chinese copper and gold miners.

Top Stock Picks: Goldman Sachs' top stock picks include ZIJIN MINING and CMOC, which are expected to benefit from rising commodity prices and increased production.

Earnings and Target Price Adjustments: The recurring earnings forecasts for ZIJIN MINING and CMOC have been raised by 14-18% and 20-24%, respectively, with target prices increasing to HKD52 and HKD27, maintaining a Buy rating for both.

Acquisition Details: CMOC has completed the acquisition of Equinox Gold's gold asset portfolio in Brazil for up to US$1 billion, as reported by Jefferies.

Gold Price Analysis: Jefferies' analysis indicates an implied gold price of approximately US$3,320 per ounce, significantly lower than the current spot price of over US$5,000.

Production Targets: CMOC aims to achieve nearly 20 tons of annual gold production from its projects in Brazil and Ecuador once fully operational, with gold expected to contribute 5-6% to gross profit by 2026 and over 10% by 2030.

Investment Rating: Jefferies has rated CMOC's H-/A-shares as a Buy, setting target prices at $25.9 and RMB26.7, respectively.

Market Opening: The HSI, HSCEI, and HSTECH opened higher, with the HSI up 0.4% at 26,844, driven by reports of approvals for major tech companies to purchase Nvidia's H200 chips.

Tech Stock Performance: Alibaba and Tencent saw slight movements, while other tech stocks like Kuaishou and Meituan experienced mixed results, with some stocks like Baidu declining significantly.

Resource Stocks Surge: Gold and silver prices rose, leading to gains in mining stocks such as Zijin Mining and Jiangxi Copper, with Zijin Mining benefiting from the commencement of a new copper mine phase.

Corporate Developments: CKH Holdings advanced due to plans to split a port sale into separate parcels, while Pop Mart's stock rose after launching a trendy phone in collaboration with Honor.