Iron ore futures went parabolic overnight

Chinese iron ore futures soared in overnight trade with the most actively traded January 2016 contract on the Dalian commodities exchange surging by 14.5 yuan, or 3.95%, to 382 yuan.

The contract currently sits “limit up”, meaning it cannot rise any further today according to contract specifications.

The surge follows a small bounce in the iron ore spot price, the third consecutive daily gain, with the price for benchmark 62% fines rising 26 cents, or 0.48%, to $53.93 a tonne according to Metal Bulletin.

Should the enormous gain in Dalian futures be maintained during Friday’s day session, it suggests there’ll be a hefty increase in the spot price later on this evening.

Trade in Dalian will resume at 11am AEST.

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