Iron ore futures rose on Wednesday, with the Singapore benchmark rebounding after six straight sessions of declines, as hopes re-emerged that China may consider rolling out more impactful stimulus measures to support its flagging economy.
The steelmaking ingredient’s most-active November contract on the Singapore Exchange climbed by up to 1.7 percent to $112.70 per metric ton, after hitting a six-week low in the previous session.
Iron ore’s most-traded January contract on China’s Dalian Commodity Exchange was up 1.2 percent at 828.50 yuan ($113.62) per ton.
The Singapore reference price has fallen more than 7 percent from the third-quarter peak of $121.10, with recent losses spurred by concerns about looming steel production cuts in China and uncertainty over the country’s struggling property sector.
Country Garden has warned about its inability to meet offshore debt obligations, potentially joining a growing list of Chinese developers that have defaulted and underscoring a deepening crisis hurting the world’s second-biggest economy and largest steel producer and metals consumer.
“We note China’s deteriorating property sector is potentially a catalyst for more significant stimulus, which we see driving upside to commodity prices vs current levels,” National Australia Bank analysts said in a note.
