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Skid May Loom for Chinese Steel Prices -- Market Talk

1 Jun 2018 4:26 am

0426 GMT - US steel prices may be continuing to rise, but Smartkarma's Charles Spencer sees them skidding in China. Chats with steel brokers there hint at a decline with a pickup from delayed infrastructure projects expected to wane at a time there's lots of domestic steel. Unsold inventories are some 20% higher than a year earlier and 50% above 2016's lows, he notes. "In fact, inventories today are back to levels last seen in 2014, just before steel prices went into a major correction." He's as a result bearish on some steel stocks, including Angang. He sees shares falling to HK$6.50 in current months; they're currently at HK$8.05 and down 15% from early February's 6 1/2-year high. (kenan.machado@wsj.com)

(END) Dow Jones Newswires

June 01, 2018 00:26 ET (04:26 GMT)

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