SGX iron ore snaps rally on China COVID unrest; Dalian benchmark up – ET Auto

Benchmark December iron ore on the Singapore Exchange dropped as much as 3.2% to $95.95 a tonne.

By Enrico Dela Cruz

Iron ore futures in Singapore slumped more than 3% on Monday, retreating after a three-day rise, as protests against stringent COVID-19 restrictions in top steel producer China prompted caution.

The steelmaking ingredient, however, remained supported on the Dalian Commodity Exchange following Friday’s announcement of a further cut in banks’ reserve requirement ratio in China to bolster a slowing economy.

Benchmark December iron ore on the Singapore Exchange dropped as much as 3.2% to $95.95 a tonne. It traded briefly above $100 earlier in the session.

The most-traded Dalian iron ore for January delivery climbed up to 3.6% to 764.50 yuan ($106.00) a tonne, its highest since June 17.

Dalian iron ore was up 2.3% by 0307 GMT, rising for a third session with earlier gains driven by renewed hopes for steel demand recovery next year as China is taking further steps to shore up an ailing domestic property sector.

“Traders remain focused on further stimulus into next year,” Westpac analysts said in a note.

Some of the optimism, however, has dissipated amid protests in several Chinese cities against the country’s strict COVID-19 curbs.

“This week’s western headlines will be dominated by whether Chinese authorities stick to their guns on the no-nonsense zero-COVID strategy or repeal these measures,” Navigate Commodities Managing Director Atilla Widnell said.

“This will be an interesting test of financial markets and whether they are fazed or unfazed by social factors in China or continue to trade COV-exit cues,” he added.

Sentiment was also mixed on the Shanghai Futures Exchange with rebar up 1.4% and hot-rolled coil advancing 1.3%, while wire rod slipped 0.8% and stainless steel dipped 0.7%.

Other Dalian steelmaking inputs also rose, with coking coal and coal up 0.8% and 0.7%, respectively.

Also Read:

Three-month copper on the London Metal Exchange was up 0.8% at $8,072.50 a tonne by 0201 GMT, while the most-traded December copper contract on the Shanghai Futures Exchange rose 0.2% to 65,060 yuan ($9,111.92) a tonne.

Source link

Related Articles

Back to top button