April 16, 2019 / 2:36 AM / 3 months ago

Shanghai steel steadies ahead of Q1 GDP data

BEIJING, April 16 (Reuters) - China’s steel futures were little changed on Tuesday after reaching a 7-1/2 years peak in the previous session, as cautious investors waited on the release of GDP data.

Benchmark Shanghai rebar prices edged down 0.1 percent to 3,817 yuan ($568.78) as of 0206 GMT, just shy of a multi-year high at 3,843 yuan.

Hot-rolled coil futures slid 0.6 percent to 3,714 yuan a tonne.

Strong steel prices have been supported by firm demand from downstream sectors, while expectations that Beijing and Washington may reach a trade deal have also buoyed investor sentiment.

Meanwhile, China’s new home prices rose 0.6 percent in March from a month earlier, quickening from 0.5 percent growth in February, according to Reuters calculation based on official data on Tuesday, a sign of a warming property market amid loosening curbs in some cities.

“General market sentiment is improving amid strong macro-data. Both supply and demand in the steel sector are increasing, which would help to buoy steel prices,” said analysts from Huatai Futures.

China will release first-quarter gross domestic product (GDP) and March activity data on Wednesday, which will give clearer indication of the country’s economic performance.

A Reuters poll on Friday suggested that China’s economic growth may slow to a near 30-year low of 6.2 percent this year, weighed by sluggish demand at home and abroad despite a flurry of policy support measures.

Prices of steel-making raw ingredients were mostly flat on Tuesday.

The most-active coking coal futures on the Dalian Commodity Exchange edged up 0.1 percent to 1,325 yuan a tonne, while the coke contract for September delivery rose 0.1 percent to 2,048.5 yuan.

Dalian iron ore futures fell 0.9 percent to 647.5 yuan.

On Monday, China’s coal hub Linfen, also one of the country’s most polluted cities, said it plans to extend its winter restrictions on heavy industries to the end of the third quarter this year.

Steel mills and coke plants in the city will be ordered to halt at least 30 percent of their operations or even shut down during the period. ($1 = 6.7108 Chinese yuan renminbi) (Reporting by Muyu Xu and Shivani Singh; editing by Richard Pullin)

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