Chinese tightening measures have had limited effect on base metals so far, but eventually they will take their toll, suggests Edward Meir, analyst with MF Global. Chinese authorities are upping the bank reserve ratio requirement another 50 basis points. Meir notes that metals are mixed, with copper, tin, and nickel all down slightly, while the rest post modest gains. “So far, Chinese measures to cool the economy off do not seem to have had much effect, which is why metal markets have brushed off each successive rate or reserve hike,” Meir says. “However, we believe the slower pace of activity is a matter of when, not if, and a more significant downside move in metals will eventually come our way once Chinese macro data starts to reflect the impact of these moves whose impact on the economy will only grow after each round higher.”
So may be in forthcoming days we can see some pressure on metal stocks......??
So may be in forthcoming days we can see some pressure on metal stocks......??
