Steel Continues to Decline to Its Lowest Level in 7 Years: In late July, the price of rebar futures fell below 3,100 Chinese yuan per ton,
reaching its lowest level in over seven years amid weak demand and abundant supply in China, the largest consumer.
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Oil Prices Close Lower Due to Chinese Demand Concerns
West Texas Intermediate crude oil futures fell by 1.4% to settle at $77.16 per barrel on Friday,
marking a third consecutive weekly decline due to weak Chinese demand despite positive U.S. inventory data.
Concerns about economic growth in China, highlighted by interest rate cuts in Beijing to stimulate the economy,
negatively impacted market sentiment.
The decline in China’s oil imports and refinery activity due to slowing economic growth affected prices.
Furthermore, ceasefire talks between Israel and Hamas eased supply concerns, adding more pressure.
Meanwhile, strong economic growth in the United States in the second quarter
Rising expectations of a potential federal interest rate cut in September could boost oil demand.
On Wednesday, the U.S. Energy Information Administration reported
a larger-than-expected decline in U.S. crude inventories by 3.7 million barrels and a significant drop in gasoline inventories by 5.6 million barrels.
Market watchers are divided on whether OPEC+ will ease production restrictions in the next quarter,
with a meeting scheduled for August 1.
Steel Continues to Decline to Its Lowest Level in 7 Years
The price of rebar futures fell below 3,100 Chinese yuan per ton in late July,
reaching its lowest level in over seven years amid weak demand and abundant supply in China, the largest consumer.
The Chinese government imposed new quality standards for rebar to take effect in late September,
prompting mills and traders to flood the market with old stock before the new standards for the metal took effect.
Meanwhile, China’s economy grew less than expected in the second quarter,
and housing prices fell to their lowest level in June of nine years, highlighting the severity of the real estate crisis in China.
The data weakened expectations for future construction activity.
They increased the likelihood of liquidation by debt-laden real estate developers in China,
erasing a key source of global demand and Chinese economic output.
The downturn caused by the housing recession prevented the Chinese government from aiding real estate developers,
as such measures would exacerbate the current oversupply of housing.
Next Week – July 29
In the United States, key events will include the Federal Reserve’s interest rate decision and the non-farm payroll report.
Other significant events include job openings in JOLTs, consumer confidence from CB,
the ISM manufacturing PMI, factory orders, the S&P Case-Shiller home price index,
pending home sales and the employment cost index.
The earnings season will enter one of its busiest weeks,
with giant companies like Microsoft, Meta, Apple, and Amazon taking center stage.
On the other hand, the Bank of England, the Bank of Japan,
and the Central Bank of Brazil will provide updates on their monetary policies.
Inflation rates will be released for Spain, Germany, Australia,
the Netherlands, France, Poland, the Eurozone, Italy, South Korea, and Switzerland.
GDP growth rates will also be announced for France, Spain, Germany, Italy, the Eurozone, and Mexico.
In China, manufacturing and services PMI indicators will be closely watched.
Manufacturing PMI indicators for South Korea, Russia, Spain, Italy, and Canada will also be published.
Steel Continues to Decline to Its Lowest Level in 7 Years