Chinese steel market had opened on positive note on October 9th after week long holidays giving hope of revival. But the positive sentiments seem to be an illusion and more of speculation as the prices was stable on October 10th.
Although steel rebar futures at SHFE posted marginal gains consecutively for the second day and prices of various steel products were stable at most of the locations, prices of long products in Shanghai went down reflecting negativity among market players
It is seen in past that sentiments drive the steel prices in China and market players are quick to follow a trend for continued rally or downtrend.
Although it is too early to say, the market movement on 2nd day after opening reflects that nothing much has changed in the Chinese steel sector and prices remain under pressure from limited demand growth amid huge surplus production
One of the most important indicator for the health of Chinese steel sector and sentiments iron ore exhibited mixed trends. Iron ore January contract futures at the Dalian Commodity Exchange rose on Thursday by nearly 2% to end at CNY 563 per tonne and December iron ore contract on the Singapore Exchange edged up 0.7 percent to USD 78.20 per tonne but Iron ore for immediate delivery to China IO62-CNI=SI slipped by 0.3% to USD 79.80 a tonne on Wednesday
Source – SteelGuru’s Market Intelligence Services PS14
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