Iron ore falls ahead of China unveiling fresh fiscal stimulus
BEIJING, Nov 8 (Reuters) -Iron ore futures slid on Friday, as investors adopted a cautious stance amid continuously falling demand and before top consumer China unveiled its keenly-watched fiscal stimulus package.
The most-traded January iron ore contract on China's Dalian Commodity Exchange (DCE) DCIOcv1 traded 1.14% lower at 780 yuan ($109.13) a metric ton, as of 0306 GMT.
The benchmark December iron ore <SZZFZ4> on the Singapore Exchange was 1.64% lower at $103.8 a ton, as of 0300 GMT.
With uncertainty on the U.S presidential election dissipating, the market is awaiting details of China's fiscal spending, said analysts.
Some market watchers expect most funds will go in easing local government debt burdens and won't offer much of a boost to near-term economic growth.
"We expect the impact from the macroeconomic factor to gradually recede and prices in the ferrous market will reflect more influence from fundamentals," analysts at Sinosteel Futures said.
Demand for the key steelmaking ingredient contracted further and persistently high imports led to continued pick-up in portside stocks, weighing on prices.
The average daily hot metal output fell for the second straight week by 0.6%on the week to 2.34 million tons as of Nov. 8, while profitability among steelmakers slid for a third consecutive week to 59.74, a survey by consultancy Mysteel showed.
Fears of disruptions to the Federal Reserve's easing cycle as Trump won the U.S. presidential election also put a downward pressure.
"With Trump now destined to reclaim the presidency, there are growing expectations that the Fed will not cut as aggressively as previously thought," ANZ analysts said.
Other steelmaking ingredients on the DCE posted gains, with coking coal DJMcv1 and coke DCJcv1 up 0.57% and 1.23%, respectively.
Most steel benchmarks on the Shanghai Futures Exchange edged lower. Rebar SRBcv1 shed 0.15%, hot-rolled coil SHHCcv1 lost 0.14%, wire rod SWRcv1 retreated 0.16% while stainless steel SHSScv1 gained 1.3%.
($1 = 7.1475 Chinese yuan)
Reporting by Amy Lv and Mei Mei Chu; Editing by Sumana Nandy
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.
