By Amy Lv and Dominique Patton
BEIJING, May 16 (Reuters) - Dalian iron ore futures
rallied to a three-week high on Tuesday, supported by the
Chinese central bank's promise to provide money-market
liquidity, before giving up some of the gains after
weaker-than-expected economic data.
China's central bank said on Monday it would keep liquidity
reasonably ample and interest rates reasonable and appropriate
to support domestic demand.
The statement by the People's Bank of China bolstered market
sentiment and underpinned prices in early trading, analysts
said.
However, a flurry of economic data took the edge off the
sentiment, showing a slide in the property sector was picking up
pace. Other indicators, including industrial output and retail
sales, undershot expectations.
Investment in the property sector, the largest steel
consumer in China, tumbled 16.2% year-on-year in April after a
7.2% drop in March, Reuters' calculations based on official data
showed.
Investment for January-to-April fell 6.2% on the year,
compared to a 5.8% decline in the first three months, the
official data showed.
The most-traded September iron ore futures contract on the
Dalian Commodity Exchange (DCE) ended morning trade
1.19% higher at 724 yuan a tonne, after reaching a three-week
high of 733.5 yuan a tonne earlier in the session.
The benchmark June iron ore contract on the
Singapore Exchange was 0.65% lower at $104.35 a tonne, as of
0453 GMT, after hitting a one-week high at $105.03 a tonne on
Monday.
Other steelmaking ingredients similarly narrowed gains with
coking coal climbing 0.76% and coke rising
0.8%.
Rebar on the Shanghai Futures Exchange edged down
0.05% to 3,650 yuan a tonne, hot-rolled coil was flat,
wire rod shed 1.25% and stainless steel fell
2.96%.
"Some mills planned to restart operations amid improved
margins, and this will put downward pressure on steel prices
given that the market is approaching an off-demand season,"
analysts at Haitong Futures said in a note.
China churned out 354.39 million tonnes of crude steel in
January to April, the highest for the period since 2021 and up
4.1% from the same year-earlier period, the official data
showed.
(Reporting by Amy Lv and Dominique Patton in Beijing; Editing
by Neil Fullick)
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