May 7, 2020 / 2:13 AM / a month ago

China iron ore, steel futures gain on further economic stimulus

* Dalian iron ore up as much as 1.5% in early trade

* Coking coal futures jump following explosion at Anglo American

* China mulls more measures to alleviate tax burdens on companies

BEIJING, May 7 (Reuters) - Iron ore and steel futures in China jumped in early trade on Thursday, after Beijing pledged more stimulus to relieve tax burdens and boost credit support for companies.

In a cabinet meeting led by Premier Li Keqiang on Wednesday, the government said it will further extend tax cuts for small firms and create policy tools that will enable banks to issue more unsecured loans, Chinese state television reported.

China also aims to issue another 1.0 trillion yuan ($140 billion) worth of local government special bonds by the end of May, according to the cabinet meeting.

The most-traded iron ore futures on the Dalian Commodity Exchange, for September delivery, rose as much as 1.5% to 620 yuan a tonne earlier. They were up 1.1% at 618 yuan by 0130 GMT.

The October contracts of steel futures on the Shanghai Futures Exchange also gained, with construction rebar and hot-rolled coil both rising 1.0% to 3,422 yuan and 3,274 yuan, respectively.

Dalian coking coal advanced as much as 2.6% to 1,101 yuan a tonne, as production at a coal mine run by Anglo American in Australia’s Queensland state was halted on Wednesday after an explosion, which injured five people.

Tracking the jump, coke futures rose 1.5% to 1,735 yuan per tonne.

FUNDAMENTALS

* Spot prices of iron ore with 62% iron content for delivery to China were unchanged from previous session at $84.5 per tonne on Wednesday.

* Stainless steel futures, for June delivery, edged up 0.8% to 13,235 yuan per tonne.

* More than 3.71 million people have been reported to be infected by the novel coronavirus globally and 258,186 have died, according to a Reuters tally.

* Brazilian steelmaker Gerdau said on Wednesday its profit for the first quarter fell by half to 221 million reais ($39.6 million) compared with a year ago due to weaker sales in South America, although sales in the United States were more resilient.

* China’s Geely Automobile Holdings Ltd said on Wednesday that it sold 105,468 vehicles in April, 2% higher than the same period last year, as world’s biggest auto market recovers from the coronavirus.

$1 = 7.1031 yuan Reporting by Min Zhang and Tom Daly; Editing by Aditya Soni

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