Daily iron ore price update (silly rally)

Iron ore prices for April 30, 2020:

A spontaneous rally following stocks and yesterday’s China PMIs. It is another measure of the hysteria that the PMIs were seen as bullish. They were not.

PMI indexes are directional not absolute. With weak growth in all it is a very bad sign for China’s recovery given they are coming off such a low base. For any kind of vibrant recovery, I’d expect to see PMIs above 60 not around 50.

The steel PMI was still dire at 45.9 and 39.9 for new orders:

In short, demand is still falling, if slightly less slowly. New export orders fell more slowly as well but are still crashing:

China posting a very weak recovery from a massive fall in output – with steel still completely buggered – was a clear reason to sell not buy.

If you care about such things.

David Llewellyn-Smith
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