Mining and Base Metals Stocks Climb on China Optimism By Investing.com
By Geoffrey Smith
Investing.com — Mining stocks rose sharply on Friday as base metal prices rose in response to a report that boosted hopes for a quick easing of China’s Zero-COVID policy.
Bloomberg reported earlier that China was working on plans to scrap a system that penalizes airlines for bringing cases of the virus into the country. The report reignited this week’s strong rally in Chinese stocks, which began when unverified claims on Chinese social media said the government could form a new committee to coordinate an exit from a policy that has dampened the second Mondial economy. all year.
The National Health Committee had poured cold water on those suggestions on Thursday, but Friday’s backlash suggested a market that has performed poorly amid the ongoing pandemic disruption desperately wants to believe in a turn for the better.
Those hopes were bolstered later when news agencies reported that Zeng Guang, an epidemiologist who had previously advised the Chinese government, told an investment conference that he expected significant changes in the Zero-COVID policy within five to six months.
Hong Kong jumped 5.4% on the news, completing its best week in 11 years. Mainland Chinese stock indices gained between 2.5% and 3.6%.
The optimism immediately impacted prices, the traditional proxy for Chinese growth. They hit $85 a ton in China, after hitting a 2.5-year low of $80.03 earlier this week. London futures also rose 2.9% to $7,991 a tonne, while futures and futures rose 1.8% and 3.7%, respectively.
That translated into big gains for London-listed mining companies in the early hours of trading in Europe on Friday. Anglo-American (LON:) the stock rose 7.3%, while Rio Tinto (LON:) the stock rose 5.9%, and glencore (LON:) the stock rose 3.0%. Copper specialist Antofagasta (LON:) Shares rose 5.5%, while the coal mining group Thungela Resources (LON:) increased by 2.2%.