BEIJING: Prices of iron ore futures rode a roller coaster on Tuesday, as some investors unwound long positions to lock in profits, with some analysts saying top consumer China missed expectations for unveiling more forceful stimulus measures at a presser.
The most-traded January iron ore contract on China’s Dalian Commodity Exchange (DCE) ended daytime trade 2.37% lower at 783.5 yuan ($111.15) a metric ton.
It touched the highest since July 8 at 844.5 yuan a ton earlier in the session, driven by hopes of more stimulus.
The benchmark November iron ore on the Singapore Exchange slid 4.97% to $105.25 a ton, as of 0758 GMT, the lowest since Sept 30. It hit its highest since June 3 at $115 a ton earlier in the day.
It had risen by 2.5% when the Chinese market was closed for a public holiday. China is “fully confident” of achieving its full-year economic targets, the state planner said at a press conference in Beijing on Tuesday.
“The long-awaited conference this morning failed to deliver the expected signal of further strong stimulus,” said Pei Hao, an analyst at international brokerage Freight Investor Services.
“Therefore, some (traders) liquidated part of long positions to cash in profit.” A raft of monetary easing policies and property stimulus in the world’s second-largest economy in the past two weeks have seen prices of the key steelmaking ingredient jump by more than 20%. China’s home sales rose during the National Day holiday after a string of property stimulus measures to boost the country’s beleaguered real estate market since late September, state media said on Saturday.
Also, weighing on broad sentiment was the Chinese regulators’ move urging financial institutions to strengthen internal control over leverage, and prevent bank loans from illegally entering the stock market.
Other steelmaking ingredients on the DCE erased earlier gains, with coking coal and coke down 0.77% and 1.61%, respectively. Gains of steel benchmarks on the Shanghai Futures Exchange broadly narrowed. Rebar rose 0.43%, hot-rolled coil added 1.07%, and stainless steel climbed 1.6%. Wire rod surged 8.1%.