Steel reinforcement-bar futures dropped for a second day after a leading indicator for China’s economy rose at a slower pace, boosting concern that demand growth for the construction material may slow.
Rebar for delivery in May fell as much as 1.4 percent to 3,764 yuan ($604) a metric ton on the Shanghai Futures Exchange, the biggest intraday loss since Nov. 29. It ended the morning session at 3,779 yuan.
The gauge rose 1.1 percent in November, compared with a revised 1.6 percent gain the previous month, the New York-based Conference Board said today. This month, futures have surged 9.2 percent to yesterday’s close, outpacing the 1.9 percent gain in spot prices. China is the world’s largest steel user.
“We’ve had a rally that was largely pinned on people’s optimistic outlook for a faster economic recovery and therefore steel consumption,” Lv Xiaohua, an analyst at Everbright Futures Co., said by phone from Shanghai. “The immediate market is not reinforcing that view.”
The average spot price rose 0.3 percent to 3,633 yuan a ton yesterday, according to Beijing Antaike Information Development Co. Spot iron ore at Tianjin port gained 2.4 percent to $135.50 a dry ton, the highest level since July, according to a gauge compiled by The Steel Index Ltd.
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