Dalian iron ore futures dip on factory activity contraction
Dalian iron ore futures inched lower on Wednesday, as data showing a contraction in factory activity in top steel producer China weighed on sentiment.
The most-traded January iron ore on China’s Dalian Commodity Exchange ended day-time trade 0.3% lower at 769.0 yuan ($107.65) a tonne.
On the Singapore Exchange, the benchmark December iron ore was down 0.1% at $100.65 a tonne, as of 0710 GMT.
China’s manufacturing and services activities shrank further in November to seven-month lows, official data showed, stung by the country’s strict COVID-19 restrictions and rising infections that analysts said will hurt the economy well into 2023.
People in the Chinese manufacturing hub of Guangzhou clashed with white hazmat-suited riot police on Tuesday night, the latest in a string of protests that escalated over the weekend over stringent COVID-19 lockdowns.
The country reported 37,828 new COVID-19 infections on Nov. 29, of which 4,288 were symptomatic and 33,540 were asymptomatic, the National Health Commission said on Wednesday.
Market sentiment remains slightly buoyed by recent measures by the Chinese government to support the country’s beleaguered real estate sector, ANZ said in a research note.
Further, following protests over the weekend, China’s National Health Commission said excessive COVID-19 curbs should be avoided, even as the virus spreads, the note added.
Asian shares rebounded on Wednesday as investors pinned hopes on China eventually reopening its economy despite growing COVID-19 lockdowns that pushed its factory and services sector activity deeper into contraction.
The most-active rebar contract on the Shanghai Futures Exchange fell 0.7%, meanwhile hot-rolled coil dipped 0.3%, meanwhile stainless steel rose 0.3%, and wire rod advanced 0.5%.
Dalian coking coal and coke fell 0.3% and 1.4%, respectively.
Source: Reuters (Reporting by Matthew Chye; Editing by Uttaresh.V and Sherry Jacob-Phillips)