The S&P/ASX 200 Materials Index (ASX: XMJ) is dragging the S&P/ASX 200 Index (ASX: XJO) into the red on Friday as many of the market's biggest mining shares struggle.
The materials sector has fallen 1.8% at the time of writing following a disastrous night for iron ore. For context, the ASX 200 is up 0.02% right now
ASX 200 mining giants BHP Group Ltd (ASX: BHP), Rio Tinto Limited (ASX: RIO), and Fortescue Metals Group Limited (ASX: FMG) are among those suffering. Their share prices are falling between 1.8% and 2.5% right now.
So, what's weighing on the sector on Friday? Let's take a look.
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What's going wrong for ASX 200 mining shares?
ASX 200 mining shares are sliding on Friday as a major lockdown in China weighs on sentiment for materials.
Chengdu, the capital of China's Sichuan province, is in lockdown after 157 COVID-19 infections were detected in the city, BBC News reports. That sees around 21 million people in lockdown.
Fears the lockdown could further hamper the nation's recovery seemingly weighed on iron ore futures overnight. It plummeted 8% to US$96.39 a tonne.
Meanwhile, base metals tumbled as much as 7.6% after Chinese factory activity was found to have fallen in August, according to CommSec.
To top it off, Macquarie has reportedly downgraded its outlook for the copper price and slashed earnings forecasts for copper miners as a result, The Australian reports.
The broker is also said to have dropped its price targets for Sandfire Resources Ltd (ASX: SFR), 29Metals Ltd (ASX: 29M), BHP, and Rio Tinto by between 17% and 3%.
Today's tumble comes after the ASX 200 sector housing the market's mining shares posted a whopping 4.9% loss on Thursday. It's currently 10.2% lower than its August peak.
Lithium shares are among today's worst performers. Shares in Mineral Resources Limited (ASX: MIN), Lake Resources NL (ASX: LKE), and Core Lithium Ltd (ASX: CXO) are currently the ASX 200 materials index's biggest weights, falling 5.7%, 5.3%, and 5.4% respectively.
