Iron ore rebounded as China announced another briefing on policy support, rebooting speculation major fiscal measures will be rolled out after an address on Tuesday left investors disappointed.
The steelmaking staple spiked more than 3%, before giving up most of that gain, after the State Council said Finance Minister Lan Fo’an would introduce moves “to strengthen counter-cyclical adjustment of fiscal policy” at a briefing on Saturday. Copper rose more than 1% on the London Metal Exchange before paring the advance.
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Iron ore has been whipsawed in recent sessions as investors seek to gauge whether China will act more aggressively to support growth in the largest importer. It fell to a two-year low in September amid deep pessimism over prospects in the country, which has been hurt by a property slump and Beijing’s apparent reluctance to go ahead with major capital spending projects.
“Monetary policies have already been unleashed and other measures including fiscal policies will follow,” said Li Xuezhi, head of Chaos Ternary Research Institute. “We still tend to go long on both equities and ferrous metals amid expectations on more stimulus coming up.”
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