Iron ore hit a new two-week high on the Dalian Stock Exchange on Wednesday (27), after data showed that profits of industrial companies in China rebounded last month.
Still, problems in the country’s real estate sector have kept the steel ingredient’s gains on the Singapore stock market weak.
The benchmark ore contract for September delivery on China’s Dalian Commodity Exchange ended trading up 2.4% at 744.50 yuan ($110.11) a tonne.
Earlier in the session, the ore reached its highest level since July 11, at 756 yuan.
On the Singapore Stock Exchange, the most-traded iron ore for September rose 0.3% to $112.45 a tonne, after a 14% rise in the past three sessions, indicating waning enthusiasm over news from a fund bailout for Chinese real estate developers.
The profits of industrial companies in China, the largest producer and consumer of steel in the world, returned to growth in June, boosted by the resumption of activity in the main manufacturing hubs.
But concerns over a resurgence of Covid-19 have cast shadows over the factory’s future production.
While more signs of economic recovery are emerging in China, fears of a crisis involving the country’s real estate developers also remain, despite a planned Chinese rescue fund of up to 300 billion yuan.
“The market is unlikely to be very excited about a quick resolution” to China’s housing crisis, analysts at JPMorgan said in a note.
Source: CNN Brasil
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