Metals rebound from their worst week in a year on China optimism
BNN Bloomberg
Base metals rebounded from their worst week in a year as China’s economy showed signs of recovering, and Goldman Sachs Group said global supplies were still constrained.
Early indicators for China’s economic activity tracked by Bloomberg suggest an improvement during June as COVID-19 restrictions were gradually eased. An overall gauge of the outlook returned to neutral after deteriorating for two straight months, though the recovery remains muted.
“Whether zero-COVID, the property slowdown, or a consumer lacking confidence, Chinese metals demand has been very weak over 1Q,” BMO Capital Markets metals and mining analysts led by Colin Hamilton wrote in an emailed note. “However, there is no doubt we are past the nadir in terms of activity.”
Metals are still on track for the biggest quarterly plunge since the 2008 financial crisis amid rising fears of an industrial slowdown across major economies. Tin led the rebound Monday on the London Metal Exchange, paring a record 21 per cent weekly loss that took prices to a 15-month low. Nickel and aluminum also rose, reversing last week’s declines.
