BEIJING- Iron ore futures extended gains on Friday and posted a weekly gain, thanks to a brighter demand outlook in top consumer China and improved fundamentals in the near term.
Mixed data signals, however, stoked investors caution and capped gains.
The most-traded September iron ore contract on China’s Dalian Commodity Exchange (DCE) ended morning trade 1.22 percent higher at 828 yuan ($114.42) a metric ton. It logged a fifth consecutive session of gains, and a weekly rise of 7.3 percent .
The benchmark May iron ore on the Singapore Exchange was 0.58 percent higher at $108.85 a ton, an increase of 4.4 percent so far this week.
Average daily hot metal output climbed for a second week by 0.5 percent to 2.25 million tons as of April 12, while iron ore stocks at major ports rose by 0.2 percent to 144.87 million tons, a survey from consultancy Mysteel showed.
“Hot metal output will likely continuously pick up in the coming weeks and we expect portside ore stocks to fall to a low of around 130 million tons in the second quarter,” analysts at Galaxy Futures said in a note.
Quicker-than-expected progress for the pledged equipment upgrade also buoyed sentiment and supported prices.
China will give strong financing for firms involved in the program of equipment upgrades and trade-ins of consumer goods, government officials said on Thursday, the latest bid to spur domestic demand.
