JPMorgan has issued a research report indicating that Zijin Mining (ASX: 02899) and Zijin Gold Intl (ASX: 02259) have reported interim profit alerts that fell short of expectations.

This underperformance is primarily attributed to declining gold prices, copper and gold production targets being less than 50% achieved, and more significant impacts from cost inflation.

The report anticipates a mild to negative short-term stock price reaction, with investor focus expected to remain on commodity price trends, US-Iran negotiations, and interest rate decisions.

JPMorgan maintains an "Overweight" rating on both stocks, with a target price of HK$50 for Zijin Mining and HK$170 for Zijin Gold Intl, and continues to list Zijin Mining as its preferred sector stock.

Zijin Mining's interim profit alert forecasts second-quarter core profit, excluding non-recurring items, at approximately RMB 19.4 billion, representing a sequential increase of 5% but falling below the bank's expectation of RMB 21.5 billion.

First-half core profit is estimated at RMB 37.9 billion, reaching about 48% of the market's full-year forecast, which is slightly below the bank's projections.

Zijin Gold Intl's interim alert indicates a forecasted second-quarter profit growth of 67% year-on-year to around US$590 million, which also came in below JPMorgan's expectation of US$830 million.