Highlights The slowdown in global industrial activity appears to have bottomed. This, along with an apparent shared desire for a ceasefire in the Sino-US trade war, points toward a measured recovery in manufacturing and global trade,…

Away from the Sino-U.S. trade-war headlines – and the remarkable commodity price volatility they produce – apparent steel consumption in China is up 9.5% y/y in the first seven months of this year. This is being spurred by…

Chart II-1Is Deflation In Steel And Coal Back?  Unlike 2015 when steel, iron ore and coal prices collapsed, in the current downturn they have so far held up reasonably well. They have begun falling only recently (Chart II-1).…

Highlights The current global trade downtrend has primarily been due to a contraction in Chinese imports. The latter reflects weakness in China's domestic demand in general and capital spending in particular. The current global…

Highlights As long as Chinese policymakers remain committed to their anti-pollution campaign, we believe high-grade iron ore prices will remain supported by demand from newer steelmaking technologies. A continuation of the much-needed…

  ​​​​​​Overweight Since our upgrade to overweight mid-last month,1 steel stocks have been outperforming as operating metrics have continued to fire on all cylinders. New orders have been soaring in the past two years as end…

Overweight While steel stocks should have benefitted enormously from the U.S./China trade war and steel import tariffs, China macro dictates the fate of the S&P 1500 steel index. China’s waning fiscal and credit impulses have…

Highlights Portfolio Strategy The budding recovery in Chinese infrastructure outlays and easing in monetary conditions, a pause in the U.S. dollar’s rally on the back of a more dovish Fed and improving domestic steel final-…