Reuters reported that China's approval of a USD 157 billion infrastructure plan for roads and railways sent US steel and coal shares surging on September 7th 2012.
Ms Michelle Applebaum of Steel Market Intelligence in Chicago said that "It's definitely China. Steel prices are determined globally, not domestically. What matters is what happens in China." She noted that 55% of global steel demand comes from China, compared with 8% from the United States.
She said that Wall Street's positive sentiment was also buoyed by European Central Bank bond buying program to resolve the euro zone debt crisis. She added that "Any good global news matters, but especially in China."
Mr William Burns, a coal industry analyst with Johnson Rice & Co in New Orleans, said the combination of the ECB move and China's roads and railways plan likely sent the stocks up. He added that "The Euro thing was an indication the economy will strengthen. And China's highways will require steel."