Iron ore, copper outrunning modest China PMI rally: Clyde Russell
No doubt investors have been cheered by the avoidance, for now anyway, of the fiscal cliff in the United States and growing signs that China's economy is re- accelerating after achieving a soft landing last year.
Asian spot iron ore <.IO62-CNI=SI> gained 3.4 percent in the first two trading days of 2013, taking it to $149.80 a tonne, a rally of 73 percent since the low of $86.70 in September last year.
London copper rose 2.7 percent the past two days to $8,149 a tonne, taking its gains since its low last June to 12.3 percent.
Shanghai copper didn't trade for the first three days in January due to Chinese holidays, but by 9 a.m. Local time Friday it had gained 1.2 percent to 58,390 yuan ($9,268) a tonne, up 14 percent from the low last year, also recorded in June.
What copper and iron ore have in common is that they all declined as the market feared a hard landing in China, and all started to recover when it became clearer that these concerns were overblown and that the elusive soft landing was more
But the recovery in China's key manufacturing sector is still modest, and certainly nowhere the scale of the rally seen after the global financial crisis and recession of 2008-09.
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