With the unexpected 50 basis point rate cut by the Federal Reserve, there has been a shift in the previously intense market discussion on whether the US economy will experience a ""hard landing"" viewpoint.

According to the latest survey of Bloomberg terminal users, with the Federal Reserve's first rate cut since 2020, it is widely believed that there is an increased possibility of the US economy achieving ""But after the bursting of the internet bubble and the Fed's rate cut in 2001, the ROI dropped by more than 10%., and it is expected that the US stock market will show an upward trend for the remaining time this year.

Most respondents expect the economy to achieve ""But after the bursting of the internet bubble and the Fed's rate cut in 2001, the ROI dropped by more than 10%.75% of people predict that the US economy will not experience a technical recession by the end of next year.

However, after the US stock market closed, both the stock market and bond market experienced declines, with the S&P 500 index giving back a 1% gain. Despite Powell's optimistic outlook on avoiding an economic recession, the US treasury market still saw selling.

Jerome Powell, the chairman of the Federal Reserve, warned the market not to expect continued significant rate cuts and hinted that borrowing costs may need to be maintained at levels higher than those before the pandemic for an extended period.

However, in theBut after the bursting of the internet bubble and the Fed's rate cut in 2001, the ROI dropped by more than 10%.expected scenario, copper stocks performed quite well,$Copper (LIST2510.US)$sector rose nearly 2% yesterday, showing favorable overall performance.

Rate cuts stimulate the rise in copper prices, and the AI ​​wave may exacerbate the copper shortage.

It can be seen that after the Fed's 50 basis point rate cut, the market showed a clear reaction. The three-month copper price on the London Metal Exchange rose by 1.1%, reaching a two-month high of $9548 per ton. ShanghaiFutures Trading Commission (CFTC)'s latest data shows that investors are significantly reducing their net short positions in US soybean, corn, and wheat contracts, easing bearish sentiment in the market.Block orders for the main October copper contract also rose to 75,640 yuan per ton, the highest point since July 31st.

Recently, with the global economic recovery falling short of expectations, copper prices have fluctuated. The Fed's rate cut decision has become the catalyst for breaking through the short-term resistance of copper prices.

Regarding the impact on various global assets, China International Capital Corporation stated that based on the general pattern of previous Fed rate cuts, on average, post-rate cut assets such as copper, US stocks, and cyclical sectors will perform relatively well. The loosening effect after the rate cut gradually becomes evident, and these assets will perform significantly.

In addition, the Chief Financial Officer of BHP Group Ltd predicted that with the rise of datacenters and AI technology, global copper demand may soar by 72% to 52.5 million tons annually by 2050. Additional demand driven by energy-intensive computing will contribute an extra 3.4 million tons of demand, increasing the share of datacenters in copper demand from the current less than 1% to 6% to 7%. Copper prices are expected to rise further in the future.

Copper, as a key material for achieving net zero emissions, is widely used in electrical cables, electric vehicles, and solar energy farms. Additionally, global copper supply is expected to face shortages in the medium to long term. The rise of AI further exacerbates this trend due to the surge in demand for datacenters and energy-intensive chips.

How to seize the opportunity of copper's rise under the expectation of a soft landing?

It is worth noting that in pre-market trading, related copper stocks have already responded to the expectation of a "soft landing" in the US economy. $Southern Copper (SCCO.US)$and$Freeport-McMoRan (FCX.US)$and have risen more than 4%. $Hudbay Minerals (HBM.US)$has risen more than 3%.

In addition, due to the convenience and high liquidity of copper ETF trading, as well as the ability to trade online at any time during trading hours, and the coverage of copper mining companies worldwide, investors can also seize the opportunity of copper price increase through ETF investment.

$Global X Copper Miners ETF (COPX.US)$is an ETF that primarily invests in global copper mining companies, with a year-to-date gain of over 10%. The top ten holdings include copper mining companies from Canada, the United States, China, and other countries. As of the time of writing, the ETF has risen by over 4%.

How to find the desired ETF? The ETF section can help you! Mooers can click on Market >ETF> Choose from a variety of ETFs in different markets.

At the same time, you can also access the detailed quote page and click on 'Fund' to view the introduction and investment components.

Editor/ping