Important Meeting Approaching, Beware of Policy Expectation Shortfall Leading to Price Pullback Risk

Last week, the ferrous metals series prices exhibited a trend of rising first and then falling. On the news front, the November manufacturing PMI was 50.3%, up 0.2 percentage points from the previous month, indicating a slight acceleration in the pace of manufacturing expansion. Mid-week, there were market rumors that the Central Economic Work Conference is expected to be held on December 11-12 to discuss the main development goals for 2025; subsequently, Xinhua News Agency published an article stating that the current Chinese economy is placing more emphasis on achieving effective qualitative improvement and reasonable quantitative growth. In the latter half of the week, the weekly steel supply and demand data were released, showing continued destocking of the five major steel products.

Looking ahead to this week, on the fundamentals side, the imbalance in the steel fundamentals is temporarily not prominent, and the center of the steel price negotiation will revolve around the two major meetings. The window for important macro meetings is opening again, and caution is advised regarding the impact of policies falling short of market expectations on sentiment.