A BROADLY positive night for industrial commodities, with nickel among the better performers with a gain of more than 1.5%.
Strong policing of new environmental laws in the Philippines that could put pressure on nickel laterite exporters was seen as behind the rise, while ANZ said iron ore’s gain came as news emerged that Hebei Province in China would start restricting mill output in late July to improve air quality.
Meanwhile the investment banks are continuing to get positive on the overall sector despite it only seeming very recently that doom and gloom was the order of the day.
Citi is the latest extolling the virtues of commodities, saying it was “especially bullish” for 2017.
“Unlike last year, when commodity markets rallied through the second quarter only to fall sharply come the third as oversupply persisted, this rally looks more sustainable as physical markets have tightened considerably,” Citi said in a report quoted by Bloomberg.
“Global demand continues to grow at a moderate rate while the pullback in capital spending is reducing not just supply growth but total supplies across all extractive industries.”
So far as mining equities were concerned on northern markets overnight, the big miners in London had a huge night with Glencore and Anglo American rising more than 6% and 8% respectively and BHP and Rio Tinto both gaining over 3%.
In Toronto the action was quieter for the gold miners on the softer sentiment for gold with better US economic data.
For the day ahead, the ASX200 futures index was up 26 points.
TLM Price at posting:
39.5¢ Sentiment: Buy Disclosure: Held
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