Iron ore climbs on China property stimulus, post-holiday restocking
SINGAPORE, May 6 (Reuters) -Iron ore futures prices rose on Monday, as investors sentiment was bolstered by Beijing's latest efforts to revive its struggling property market and an expected wave of restocking from steelmakers after returning from Labour Day holiday break.
The most-traded September iron ore contract on China's Dalian Commodity Exchange (DCE) DCIOcv1 traded 2.06% higher at 891 yuan ($123.51) a metric ton, as of 0239 GMT.
The benchmark June iron ore SZZFM4 on the Singapore Exchange was 1.45% higher at $118.75 a ton.
Beijing said in a politburo meeting on April 30 that it would coordinate and improve policies to clear housing inventory and private data showed April home sales for major property developers dropped at a slightly slower pace.
Chinese derivatives markets which were closed on May 1-3 for the May Day holiday had yet to react to the positive signals.
"There is some positive change in this meeting content compared to the one held late last December; the sales of housing inventory will provide substantial help to property developers facing capital strains," analysts at China Galaxy Securities said in a note.
Beijing also announced "optimised measures" last Tuesday to allow some residents to buy a new flat in outer districts to boost home sales, after Chengdu city in the southwestern region eased its house buying restrictions in late April.
The prospect of further improved fundamentals thanks to continuously increased hot metal output and falling ore arrivals also lifted sentiment.
"Given an obvious fall in ore arrivals, a turning point in terms of portside stocks is expected to emerge if the production resumption among mills is accelerating in mid-to-late May," analysts at Yongan Futures said in a note.
Other steelmaking ingredients on the DCE also advanced, with coking coal DJMcv1 and coke DCJcv1 up 1.69% and 1.67%, respectively.
Most steel benchmarks on the Shanghai Futures Exchange ticked higher. Rebar SRBcv1 added 1.53%, hot-rolled coil SHHCcv1 strengthened 1.47%, and stainless steel SHSScv1 edged 0.35% higher.
Wire rod SWRcv1 fell 3.18%.
($1 = 7.2137 Chinese yuan)
Reporting by Amy Lv and Emily Chow; Editing by Rashmi Aich
Latest News
Disclaimer: The XM Group entities provide execution-only service and access to our Online Trading Facility, permitting a person to view and/or use the content available on or via the website, is not intended to change or expand on this, nor does it change or expand on this. Such access and use are always subject to: (i) Terms and Conditions; (ii) Risk Warnings; and (iii) Full Disclaimer. Such content is therefore provided as no more than general information. Particularly, please be aware that the contents of our Online Trading Facility are neither a solicitation, nor an offer to enter any transactions on the financial markets. Trading on any financial market involves a significant level of risk to your capital.
All material published on our Online Trading Facility is intended for educational/informational purposes only, and does not contain – nor should it be considered as containing – financial, investment tax or trading advice and recommendations; or a record of our trading prices; or an offer of, or solicitation for, a transaction in any financial instruments; or unsolicited financial promotions to you.
Any third-party content, as well as content prepared by XM, such as: opinions, news, research, analyses, prices and other information or links to third-party sites contained on this website are provided on an “as-is” basis, as general market commentary, and do not constitute investment advice. To the extent that any content is construed as investment research, you must note and accept that the content was not intended to and has not been prepared in accordance with legal requirements designed to promote the independence of investment research and as such, it would be considered as marketing communication under the relevant laws and regulations. Please ensure that you have read and understood our Notification on Non-Independent Investment. Research and Risk Warning concerning the foregoing information, which can be accessed here.
