Big iron finds green shoots as Dalian tanks again
Advertisement
There is nothing like equity market hope. It is bright and shiny and roundly stupid. Today is a perfect example as Dalian opens -2% down and clearly under pressure yet big iron takes off as if it sells oats with BHP 3.4%, RIO 2% and FMG 3.7%:
The hope is that the worst is over. But it ain’t yet in my judgement. I still expect to see us back into the $40s driven by further steel price falls before a rebound.
In LNG, there is more and similar hope, with WPL 1%, OSH, 1.5%, STO 1% ORG 1.3% and LNG 3.7% even though short term disruptions to oil should not be outweighing the longer term bearish shifts in Saudi. But hey!
Advertisement
The full text of this article is available to MacroBusiness subscribers
Cancel at any time through our billing provider, Stripe
About the author
David Llewellyn-Smith is Chief Strategist at the MB Fund and MB Super. David is the founding publisher and editor of MacroBusiness and was the founding publisher and global economy editor of The Diplomat, the Asia Pacific's leading geo-politics and economics portal.
He is also a former gold trader and economic commentator at The Sydney Morning Herald, The Age, the ABC and Business Spectator. He is the co-author of The Great Crash of 2008 with Ross Garnaut and was the editor of the second Garnaut Climate Change Review.