ArcelorMittal, which gained more than 7% this morning, is still up 5% at mid-session, making the steelmaker the best performance of the day on the Cac 40, even though Santander analysts have announced that they are not were more value buyers.
The shares of the multinational remain heavily losing since the beginning of the year (-22%), weighed down by fears of recession, but information from the Bloomberg agency according to which China is preparing new economic stimulus measures gives them back some going.
Citing people familiar with the talks, who asked not to be identified because they are not authorized to speak publicly, Bloomberg reports that China’s finance ministry is considering allowing local authorities to issue 1.5 trillion yuan. (219.4 billion euros) of bonds in the second half of the year, which would constitute an unprecedented financing surplus, which would be allocated mainly to infrastructure spending, with the aim of supporting a struggling economy, under pressure by Covid-19 and the collapse of the real estate sector.
On this information, the actions of mining companies, those of metal companies and traders in raw materials are generally sought after. Anglo American jumped 7.5% on the London Stock Exchange, closely followed by Glencore. In Frankfurt, ThyssenKrupp grew by more than 6%. The Stoxx European index of “basic resources” (+5.5%) is by far the best sector performance on the Old Continent.
After already 160 billion announced
This new recovery plan underlines how Beijing is increasingly concerned about the state of health of the world’s second largest economy. The new funding would come on top of the 1.1 trillion yuan ($160 billion) spending plan already announced in the final weeks of the first half.
Until then, local authorities did not reissue debt before January 1 of the following year, the date of the start of the new fiscal year, explains the financial news agency Bloomberg. This unprecedented change in the timetable should therefore be considered by the Council of State and may also require the approval of the country’s legislative body, the National People’s Assembly.