MARKET OUTLOOK - Iron Ore Maintains Gains Amidst Increased Stimulus Expectations in China
Iron ore futures rose for the second consecutive session, bolstered by increasing optimism over additional stimulus from China, although the fundamentals of the key steel production component remained weak.
On the Dalian Commodity Exchange (DCE), the January iron ore contract reached its highest level since October 30 at 791.5 yuan per ton ($111.41), up 2.59% as of 05:48 AM Turkey time.
The benchmark December iron ore on the Singapore Exchange also hit its highest level since October 17, rising 1.09% to $105.05 per ton.
According to state media Xinhua, as China's top legislative body's standing committee began its meeting yesterday, Chinese lawmakers reviewed a cabinet proposal to raise local government debt ceilings in place of existing hidden debts.
This situation was interpreted positively by the market, as the heavy burden of local government debt has pressured investment and economic growth.
Analysts noted that expectations were growing for new details on fiscal stimulus measures to be presented at this week's meeting of the National People's Congress Standing Committee.
China's service activities showed the fastest growth in the last three months in October, further strengthening the overall sentiment following an unexpected expansion in manufacturing activities.
Coking coal and coke on the DCE increased by 2.17% and 2.27%, respectively.
Most steel indicators on the Shanghai Futures Exchange rose, with rebar up 1.56%, hot-rolled coil up 1.6%, and wire rod up 0.49%, while stainless steel remained stable.