By Rhiannon Hoyle
Shares in some of Australia's biggest mining stocks jumped Monday, buoyed by hopes for improving commodity demand after China signaled a loosening of pandemic restrictions and a reversal in its property-sector crackdown.
Shares in BHP Group Ltd., the world's No. 1 miner by market value and a major producer of steelmaking commodities iron ore and metallurgical coal, were recently 5.0% higher at 44.20 Australian dollars (US$29.65) a share.
Rival Rio Tinto Ltd., the world's top iron-ore producer and No. 2 miner overall by market value, was 4.3% higher at A$107.03 a share.
Both stocks are at their highest price since June. Other miners including Fortescue Metals Group Ltd. and South32 Ltd. also rallied.
China's central bank and top banking regulator issued a wide-ranging series of measures aimed at bolstering housing demand and supply, according to a notice circulated Friday to the country's financial institutions and officials involved in policy-making.
China's property sector accounts for roughly 30% of China's steel demand and 20%-30% of China's aluminum, zinc and copper consumption, according to Commonwealth Bank of Australia analyst Vivek Dhar.
Still, the outlook for commodity demand is opaque after a deep slump in the country's real-estate market in recent times, he said in a client note Monday.
"With homebuyer and creditor confidence so eroded, it's hard to gauge how quickly China's property sector can recover, even if China's Covid-zero policy has been relaxed," Mr. Dhar said. "We'd likely need to see a more meaningful relaxation of China's Covid-zero policy and a greater tolerance to live with Covid-19 than to eliminate it."
Write to Rhiannon Hoyle at firstname.lastname@example.org
(END) Dow Jones Newswires