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CFDs are complex instruments. 70% of retail client accounts lose money when trading CFDs, with this investment provider. You can lose your money rapidly due to leverage. Please ensure you understand how this product works and whether you can afford to take the high risk of losing money.

Metals outlook: China demand outlook clouds over

As China's economic data sours, Liberum Capital mining analyst, Ben Davis, tells IGTV's Angeline Ong why extra stimulus won't make a big impact on global metals demand from China.

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(Video Transcript)

Iron, copper not so bright now

It's an interesting one. The usual playbook was if China is suffering that you should then expect stimulus to be around the corner and you should start buying iron or you should start buying copper because that's what they usually use for their traditional growth engines.

What's probably more likely or where the stimulus is going to have a bigger impact is in items such as platinum group metals (PGMs), where certainly we expect internal combustion engine sales to start improving for cars.

Go for the unloved ones: coal and PGMs

So, that would then lift palladium and rhodium, the prices of which have already completely crashed out. And then also similarly, coal: we expect to see probably improvement there into the winter as it's not necessarily anything to do with the stimulus programme.

So, go for the unloved ones. Go for coal and PGMs that are already on the floor in terms of marginal pricing.


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