Market Outlook: Iron Ore Falls as Focus Shifts to Soft Fundamentals from China’s Stimulus Bets

Forex - Iron ore futures fell as investors focused on the soft fundamentals of the key steel production component amid increased expectations for more stimulus from China. The January iron ore contract at the Dalian Commodity Exchange (DCE) completed morning trades at 780 yuan/ton ($109.16), down 0.95%. The benchmark December iron ore on the Singapore Exchange declined by 2.08% to $103.2/ton at 06:59 GMT. Analysts noted that some traders preferred to liquidate part of their long positions to secure profits following the previous day’s gains, and indicated that some funds exited the market due to risk aversion stemming from uncertainties surrounding the U.S. elections, leading to declines in the prices of various commodities, including iron ore. Expectations for additional stimulus from the National People's Congress Standing Committee of China had previously boosted ore prices by over 1% during the first two sessions of the week, but these gains were erased today. Coking coal and coke fell by 3.37% and 4.09%, respectively, on the DCE. Steel indicators on the Shanghai Futures Exchange weakened, with rebar down 1.46%, hot-rolled coil down 1.31%, wire rod down 1.09%, and stainless steel down 0.3%.