Looking back at 2022, the Central Economic Conference in 2021 proposed to focus on economic construction and to make steady progress in 2022. Measures to stabilize growth led by infrastructure have been introduced, but in the course of implementation, due to repeated outbreaks, the focus of social work and resources are tilted towards epidemic prevention. The physical workload resulting from the steady growth measures was lower than expected, and real estate investment continued to deteriorate; coupled with the impact of interest rate hikes in the United States, the prices of basic metals directly related to the macro continued to fall; the global energy crisis triggered by the conflict between Russia and Ukraine further increased the production costs of enterprises. The above factors superimposed, making the macro directly related to the basic metal fundamentals all the way down, the stock price oversold; nickel, rare earths, tungsten and other small metals, although there is new energy industry demand support, but other traditional industry demand is also eventually dragged down, the fundamentals are also damaged to varying degrees. Benefit penetration rate exceeded expectations, lithium as the representative of the new energy metals to maintain a strong upward trend, becoming the biggest bright spot in the metal industry. Precious metals are also out of a very good market as overseas recession expectations rise, as well as the u. S. interest rate hike peaking and the dollar trend correction.

The sector index continues to decline and valuations have touched the bottom area. The steel (Shenwan) sector is down 20.05 percent year-to-date and non-ferrous metals (Shenwan) are down 16.79 percent year-to-date. Specifically, precious metals have achieved a positive return of 7.32 per cent since the beginning of the year, while the rest of general steel, special steel, new metal materials, small metals, industrial metals and energy metals have fallen by 20.08 per cent, 23.87 per cent, 17.02 per cent, 19.84 per cent, 10.02 per cent and 27.25 per cent, respectively. After a year of volatility, the valuation of each sub-sector has been at a low level in the past five years.