- Iron ore bulls cheer halt in operations at Fortescue’s Solomon Hub site in Australia.
- Copper struggles to justify Rio Tinto’s optimism amid Fed taper, China woes.
- Mixed sentiment also confuses industrial metals but USD pullback keeps bears away.
- US stimulus, China headlines in focus after contrasting data.
Base metals manage to cheer softer US dollar pullback, despite copper’s struggle, amid cautiously optimistic markets heading into Thursday’s European session.
To be specific, Iron ore jumps over 8.0% to cross the 740 yuan per ton level. On the contrary, Comex copper prints 0.05% intraday gains to snap a three-day downtrend around $4.20 by the press time.
Iron ore benefits from a temporary suspension of the mining activity at the world’s fourth-largest miner of the stated metal. Reuters came out with the news quoting the company announcement on early Thursday, “An employee had died after a ground collapse at its Solomon Hub site in the Pilbara region of Western Australia, forcing it (the company) to temporarily suspend mining operations at the project.”
On the other hand, one of the world’s largest mining firm Rio Tinto plans to experiment with byproducts of its copper mining operations after suspending the sale of the red metal from its Kennecott smelter.
It’s worth noting that the Chinese crackdown on the mining firms over environmental concerns and the recent power cuts also underpin metal buying.
However, China’s first factory activity contraction since February 2020 and a second coupon payment default by Evergrande joins Fed Chairman Jerome Powell’s firm support to the tapering to challenge the commodity bulls.
Amid these plays, US Treasury yields step back from a 15-week high while the US stock futures gain after policymakers manage to avoid a government shutdown.
Moving on, China’s ability to recover from the pandemic and Evergrande-led economic burden will be the key for the metals. For short-term directions, US stimulus, debt ceiling and Fed tapering will be important to follow.
Read More: Iron ore jumps around 10%, copper set for first quarterly loss in six
