The policy becomes better, and the price of steel is ushered in a sharp rebound.

Recently, the National Development and Reform Commission approved the construction plan for inter-city railway construction along the Yangtze River in Jiangsu Province (2019-2025). This is to deepen the implementation of the Yangtze River Economic Belt Development Strategy, support the integration of the Yangtze River Delta, and improve the comprehensive traffic network layout of Jiangsu's urban agglomerations along the Yangtze River. To promote high quality development.
In the past month, the National Development and Reform Commission has approved urban rail and railway construction plans (including new) in eight cities and regions, including five urban rail transits in Chongqing, Jinan, Hangzhou, Shanghai and Changchun, Guangxi Beibu Gulf Economic Zone, and new construction. The construction of three regional railways from Xi'an to Yan'an and Jiangsu's Yanjiang urban agglomeration has a total investment of about 860 billion yuan. Among them, the relevant planning investments in Shanghai and Jiangsu were approximately 298.348 billion yuan and 218 billion yuan respectively.

"This move is a major measure for the country to stabilize investment. In addition, the People's Bank of China decided last Friday to cut the deposit reserve ratio of financial institutions by 1 percentage point in January 2019, which is a good support for the steel market. At present, although China The overall infrastructure peak has passed, but the recent infrastructure investment plus signal is very clear, which will bring certain confidence to the domestic economic operation in 2019, and at the same time support the steel market," said Xu Wenjie, an analyst at Zhuo Chuang Information Steel Pipe.
Cinda Futures analysts said that in the near term, macro-optimal policies such as increased counter-cyclical adjustments, tax cuts and reductions, and optimization of liquidity structure have been repeatedly mentioned, and pessimistic expectations have been repaired. As a result of this stimulus, steel futures prices have ushered in a sharp rebound.

However, as far as the current fundamentals of the steel market are concerned, at this stage, it is still unable to support the strong price increase. Xu Wenjie said that, first of all, the inventory continues to be seasonally accumulated, the purchase volume of wire snails and the volume of building materials continue to be low, and the demand is weak. Secondly, the supply involved in the previous maintenance and strengthening control will be gradually released, and the supply pressure will be restored to High level. The recent concern is that steel mills have successively introduced winter storage policies, and the pessimistic expected repairs have boosted market confidence or will stimulate demand for winter storage. On the whole, at this stage, the fundamentals of steel are still pessimistic, and steel prices may fluctuate repeatedly. Pay attention to the strength of winter storage and the cumulative strength of steel stocks. In terms of operation, it is recommended that the rebar futures 1905 contract short position be held.

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