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Iron ore futures post weekly gain on China reopening hopes

Iron ore futures rose on Friday to post weekly gains, buoyed by expectations that top steelmaker China would relax its strict COVID-19 restrictions, lifting demand sentiment.

The most-traded January iron ore on China’s Dalian Commodity Exchange ended day-time trade 2.2% higher at 787.5 yuan a tonne, rising about 5.2% for the week.

On the Singapore Exchange, the benchmark December iron ore was up 2.7% at $105.75 a tonne, as of 0705 GMT.

Some communities in Chinese cities where COVID-19 is still spreading are easing off on testing requirements and quarantine rules ahead of an expected shift in virus policies nationwide after widespread social unrest.

Meanwhile, China reported a slight dip in new daily COVID-19 cases on Dec. 1, the National Health Commission said.

Market sentiment has also been buoyed by China’s measures to support its struggling property sector, a key consumer of steel.

These measures should have a better chance of developing into stronger demand for steel and iron ore amid a shift away from strict adherence to the zero-COVID policy, ANZ said in a note.

China’s economy will keep growing at a reasonable speed with stable employment and prices, Finance Minister Liu Kun said in a speech at the ASEAN plus Three Economic Cooperation and Financial Stability Forum.

Asian shares fell and Treasuries held on to gains ahead of U.S. non-farm payrolls data, while the dollar nursed heavy losses.

The most-active rebar contract on the Shanghai Futures Exchange SRBcv1 rose 0.6%, hot-rolled coil SHHCcv1 gained 0.8%, wire rod SWRcv1 advanced 0.9%, and stainless steel SHSScv1 climbed 0.4%.

Japan will impose anti-dumping duties on imports of hot-dipped galvanised steel wire from China and South Korea, the country’s finance ministry said, for a period of five years.

Dalian coking coal fell 0.5%, while coke DCJcv1 rose 0.7%.
Source: Reuters (Reporting by Matthew Chye; Editing by Subhranshu Sahu)

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