Chinese iron ore futures are under pressure on Wednesday, falling to the lowest level since mid-December.
Here’s the scoreboard as at 3.40pm AEDT, revealing that it’s not just iron ore futures under the kosh.
SHFE Rebar ¥3,906 , -0.43%
DCE Iron Ore ¥507.00 , -1.93%
DCE Coking Coal ¥1,289.00 , -0.31%
DCE Coke ¥1,993.50 , -1.56%
At 507 yuan, the May 2018 iron ore contract sits at the lowest level since December 15, extending its losses from January 10 to over 10%.
They’ve experienced a technical correction, in other words.
Other contracts such as rebar, coke and coking coal are also softer, suggesting the move is more linked to steel sentiment rather than iron ore specifically.
The latest bout of selling followed the release of mixed PMI data out of China for January.
Activity levels improved at a slower pace across the nation’s manufacturing sector during the month, although conditions in other sectors rose at slightly faster pace.
For China’s steel industry specifically, its PMI rose to 50.9 from 50.2, indicating a slight improvement in activity levels.
Output increased at a faster pace although new orders grew at slower pace than December. New orders from abroad also disappointed, contracting for sixth consecutive month.