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UK-listed miners fell as China targets commodity speculation

The United Kingdom-listed miners declined on Monday after China took steps to crack down on commodity speculation. Remarkably, China is the world’s largest commodities import.

Remarkably, Fresnillo and Antofagasta were the worst-performing FTSE 100 members. Meanwhile, other major miners, including BHP Group and Anglo American, fell as China’s National Development and Reform Commission announced it would severely punish commodity monopolies. It blamed increasing prices on excessive speculation.

The majority of commodity prices has risen as the global economy emerges from coronavirus lockdowns.

Cineworld shares climbed 3%, as the cinema operator reported a strong opening weekend in the United Kingdom.

China issued a zero-tolerance warning to commodity speculators

Additionally, on Monday, Chinese authorities issued a zero-tolerance warning to commodity speculators, sending the prices of some assets tumbling.

New guidelines were posted by China’s National Development and Reform Commission. That followed a meeting between the body and industry leaders and associations for commodities, including copper, aluminum, iron, steel, and nonferrous metals.

The Asian giant has been trying for weeks to cool the enthusiasm around certain commodity prices, which have been rising since the start of the year. Remarkably, optimism about global growth grows as economies emerge from the COVID-19 pandemic.

In a statement, the body promised that regulatory authorities will track commodity prices and beef up supervision of the related futures and the spot market. It vowed zero tolerance for illegal activities, including reaching agreements to implement monopoly, spreading false information, driving up prices, and hoarding.

Additionally, in China, iron-ore futures on the Dalian exchange dropped near the daily limit on Monday. Meanwhile, steel dipped by over 5%.

Corn and soybeans futures were under pressure on May 24. Meanwhile, Comex-listed iron ore, steel, and palladium also were under pressure. However, copper moved modestly higher.

Furthermore, steel futures have increased 67% year-to-date, while iron-ore futures are up nearly 31%. Copper has gained about 28%. The S&P GSCI index, which measures 24 exchange-traded commodity futures contracts, has soared 24% year to date.

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