Shanghai rebar climbs over 1% after upbeat housing data
Shanghai rebar steel futures jumped more than 1 percent on Monday after weekend data showed that China’s home prices accelerated in August at the quickest pace in almost two years, boding well for steel demand in the world’s top consumer.
Signs of more and stricter production curbs in China this winter also helped buoy steel prices, but investors are also keeping a close eye on new tariffs that the US could announce on about $200 billion worth of Chinese imports as early as Monday.
The most-traded January rebar on the Shanghai Futures Exchange was up 1.4 percent at 4,130 yuan ($601) a ton. The construction steel product has gained more than one-fifth this year.
Average new home prices in China’s 70 major cities rose 1.4 percent in August from a month earlier, according to Reuters calculations from an official survey published on Saturday.
Evidence of a strong housing market in China helped mitigate the weak data on fixed-asset investment, ANZ analysts said.
Fixed-asset investment growth slowed to 5.3 percent in January-August, below market forecasts for 5.5 percent, on slower infrastructure expansion.
“Rising home prices should not trigger stricter tightening measures in [China for] fear of derailing economic growth amid increasing external uncertainties,” Argonaut Securities analyst Helen Lau said.
Also aiding steel prices, China’s top steelmaking city of Tangshan in North China’s Hebei Province is considering smog-busting steps this winter that set penalties for heavy industry, pharmaceutical and pesticide firms based on their efforts to curb emissions.
Most steelmaking raw materials were also firmer, with coke futures outperforming.