I saw two pieces of news yesterday, which give people the feeling that the spring of cyclical stocks seems to be coming again.

First of all, the first one, that is, Bayi Iron and Steel from yesterday began to reduce the output of crude steel by 10%, of course, how long the reduction is still unknown, Bayi Iron and Steel production reduction will bring the same production reduction to other iron and steel enterprises in Xinjiang, there is no large-scale production reduction information, but as long as Bayi Iron and Steel starts, see if other steel companies will follow.

The best way to reduce production is to reduce production, no matter what, production reduction means a reduction in losses, and it may also lead to a stable price due to reduced supply.

In the past, our cyclical products have been involuted, competing with each other to bring down the price, but cheaper foreign companies, so the best way in the future is not to sell cheaply, at least to achieve the basic needs of corporate profits.

第二個消息，之前的貴金屬當中的黃金一直在持續漲價，但是如今來了一個比黃金還猛的金屬，那就是銅。國際銅期貨年內的漲幅已經達到了28.22%，而黃金年內才漲了15%，目前的國際銅價已經到了1萬美元每噸。

為什麼銅價會大幅度上升呢？主要是必和必拓的首席執行官在相關論壇上的言論，認為未來的十年全球銅供應缺口將會達到1000萬噸，而到2050年僅僅數據中心對銅的需求會增加6倍，已經有預測稱，未來的大概率會飆升到12000美元到13000美元之間，也就是說比現在的銅價要高出30%。

Judging from the above two news, almost all of them are price changes brought about by supply and demand, relative to the price change of steel is passive, because the product price caused by overcapacity continues to fall, resulting in losses for enterprises, in order to survive the production reduction action, only from this level, I feel that the positive side that can be brought is relatively limited, because the purpose of production reduction is to make product prices rise, but the industry does not carry out supply-side reform, and does not carry out reasonable planning for output from a long-term perspective. The effect of the current production cut is not very obvious in nature, so for steel, the so-called benefits of this production cut still need to be observed, and how much of a boost it can have remains to be discussed.

After all, the copper price continues to rise because the supply cannot keep up, which is theoretically a relatively benign phenomenon, but the only thing lacking in the rise in copper prices is that the global economy has improved, which has brought a strong demand for copper.

Seeing these two phenomena, people will definitely think that the spring of cyclical stocks is coming, this possibility exists, but the spring of cyclical stocks is quite different from the past, not the inevitable result of the economic cycle, different cyclical categories are in different environments, for passive cyclical categories, such as steel, because of overcapacity and production reduction, or from a short-term perspective to look at investment opportunities, and for the real demand gap, but it is appropriate to look at the high line.

Disclaimer: The content in the article is for reference only and does not constitute any advice or reminder, the stock market is risky, please be cautious when investing!