Zijin Mining to take 9.9% stake in Montage Gold
As part of the deal, the Lundin Family Trust also agreed increase its stake in the company from 17.7% to 19.9%.
Commodities from oil to soybeans to precious metals jumped after China eased some Covid restrictions, raising hopes of a demand recovery in the world’s second-biggest economy.
Almost all major commodities traded higher following China’s move to reduce the time that travelers and close contacts of infected people must spend in quarantine, a significant amendment to the Covid Zero policy. Oil futures in New York added as much as 4.2%. Copper, precious metals and agricultural commodities from corn to wheat all climbed.
China’s loosening of restrictions strengthened a rally that began on Wall Street, with risk assets rising after US inflation slowed. Markets interpreted the data as a sign that the Federal Reserve could slowdown its aggressive interest-rate hike plans. A gauge of the dollar has fallen sharply from its 2022 high in recent days, aiding commodities priced in the currency.
“Fundamentally the more China can restart its economy the greater the positive impact on global growth expectations,” said Keith Wildie, head of trading at Romco Group. “But most importantly China has historically been an exporter of deflationary pressures and if we see that deflationary force back within the global economy then the positive impact on commodity prices and asset markets in general could be exceptionally significant in the near term.”
Base metals traded on the London Metal Exchange jumped with zinc soaring as much as 6.4% and aluminum gaining 3.8%. In the US, Chicago soybean futures had the biggest intraday increase in a month.
Investors have been closely watching for signs that Beijing will loosen its restrictive policies. A gauge of energy and raw material prices has slumped from its 2022 high as demand from China remained stymied because of the virus-related movement controls.
Still, some in the market were less optimistic. Though the relaxation of the rules is a step in the right direction, the jump in oil prices looks like an overreaction given China is likely to pursue its Covid Zero policy, said Warren Patterson, head of commodities strategy at ING Groep NV in Singapore.
(By Julia Fanzeres and Alex Longley, with assistance from Winnie Zhu, Jasmine Ng, Liz Ng, Yongchang Chin, Eddie Spence and Yvonne Yue Li)
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