The BHP Group Ltd (ASX: BHP) share price is off to the races today.
Shares in the S&P/ASX 200 Index (ASX: XJO) mining giant closed yesterday trading for $37.20. In late morning trade on Thursday, shares are changing hands for $38.76 apiece, up 4.2%.
This follows a similar 4.2% increase in BHP stock in the United States markets overnight. As you're likely aware, BHP is listed on multiple international exchanges, including London and the New York Stock Exchange (NYSE).
Today's strong performance in the Aussie markets comes despite the 0.2% decline on the ASX 200 at this same time.
And it's not just the BHP share price smashing the benchmark today.
Shares in rival ASX 200 miner Rio Tinto Ltd (ASX: RIO) are up 1.9% at $110.40 apiece. And the Fortescue Ltd (ASX: FMG) share price is up 1.1% at $16.14.
Here's what's catching ASX investor interest today.
BHP share price gets a lift from China
As with Rio Tinto and Fortescue, the BHP share price is highly sensitive to the price of iron ore, the miner's top revenue earner.
For the six months through to 31 December, BHP produced 131 million tonnes of the industrial metal. And the miner reported underlying earnings before interest, taxes, depreciation and amortisation (EBITDA) of US$7.2 billion from its iron ore sales. That represented 56% of BHP's total underlying EBITDA for the half year.
Now, the iron ore price has been trending sharply lower since trading for around US$107 per tonne in late February, to just over US$93 per tonne on 1 July. But the price of the steel-making metal spiked 2.5% overnight to US$95.55 per tonne.
Why?
Well, according to ANZ Group Holdings Ltd (ASX: ANZ), both iron ore and steel prices got a boost after China's government said it would decrease some industrial capacity and target cheaper unorganised competition.
ANZ noted (quoted by The Australian Financial Review):
The move shows China's leaders are trying to tackle deflationary pressures weighing on the economy. The plans should also bring some relief to the steel industry, which has been weighed down by overcapacity.
What about copper?
With copper counting as BHP's second biggest revenue earner, the BHP share price is likely also getting a boost from the 0.8% overnight increase in copper prices.
The red metal is currently fetching US$10,013 per tonne. That's up 4.1% from the US$9,617 per tonne that copper was trading for on 2 June.
