Iron ore set for fourth weekly gain on China’s property sector moves

Iron ore futures were set for a fourth straight weekly rise on Friday, aided by China’s new measures to shore up its troubled property sector and boost confidence, although higher stocks and concerns over steel output curbs in China limited the gains.

The most-traded January iron ore on China’s Dalian Commodity Exchange (DCE) DCIOcv1 ended daytime trading 0.48% higher at 845.5 yuan ($116.40) a metric ton, rising 3.2% for the week.

The benchmark September iron ore SZZFU3 on the Singapore Exchange was 0.33% lower at $115.95 a metric ton, as of 0705 GMT, but rose 3.3% so far in the week.

China’s central bank and financial regulator on Thursday issued notices to ease some borrowing rules to aid homebuyers, including lowering the existing mortgage rate for first-home buyers and the down payment ratio in some cities, in their latest efforts to revive the crisis-hit property market.

The Caixin/S&P Global manufacturing purchasing managers’ index rose to 51.0 in August from 49.2 in July, beating analysts’ forecasts of 49.3 and marking the highest reading since February.

China will continue to cap steel output this year, the general manager of state-owned Baoshan Iron & Steel 600019.SS said on Thursday.

Portside iron ore inventories rose 942,800 tons on the week to 121.27 million tons as of Sept. 1, data from consultancy Mysteel showed.

Coking coal DJMcv1 and coke DCJcv1 on the DCE surged 6.41% and 3.94%, respectively, to five-month highs on fears of reduced supply following safety checks on coal mines.

“Anticipation of reduced supply due to the safety checks prompted some investors to build long positions,” said a North China-based analyst, requesting anonymity as he is not authorised to speak to media.

Steel benchmarks on the Shanghai Futures Exchange rose on higher raw materials costs and expectations of improved demand in September, analysts said.

Rebar added 1.29%, hot-rolled coil SHHCcv1 climbed 2.05%, wire rod SWRcv1 advanced 1.27% and stainless steel SHSScv1 rose 0.63%.
Source: Reuters (Reporting by Amy Lv and Dominique Patton in Beijing; editing by Eileen Soreng and Subhranshu Sahu)