Iron And Steel Industry In The Off-Season As Scheduled, Steel Prices Are Facing Short-Term Adjustment.

The traditional off-season of steel consumption has arrived. Foreign steel prices have slowed down. Domestic construction steel has experienced a wave of adjustment in the rainy season. Steel mills continue to raise factory prices to provide certain support for market circulation price, but the terminal demand is low, causing prices to continue to hang upside down, and steel prices are expected to be dominated by consolidation in the short term.

The recent decline in iron and steel plate over the market, worried that future downstream demand has become a mainstream market view.

The semi annual report and annual performance of listed steel companies are generally optimistic. Currently, the PE of the first tier steel mills in 2008 is only 8 to 10 times.

We believe that although the adjustment partly reflects the market's anticipation of the downturn in the industry boom cycle, if the trend is officially established or half yearly performance is lower than expected, the sector still has a downward trend.

It is suggested that we should pay close attention to the possibility of loosening the macro-control policies, and are relatively optimistic about leading enterprises such as Wuhan Iron and Steel Group, Anshan Iron and Steel Group, Baoshan Iron and Steel Group, and Baoshan Iron and Steel Co., Ltd., and those with outstanding cost advantages, such as Bayi steel, Maanshan Iron and Steel Group and Ji'nan iron and Steel Co.