Nifty Metal index gains up to O.67% amidst market crash: SAIL, Nalco, NMDC, Tata Steel lead the gains; Here’s why?

Stock Market today: Nifty Metal index gained up to 1.35% during the intraday trades on Wednesday amidst market crash. SAIL, NALCO, NMDC, Tata Steel led the gains for the Index.

Metal Index movement

Nifty Metal Index opened at 8,205.70 on Wednesday, lower than the previous close of 8,213.55 wit weakness in the markets. However the index gained up to 8,316.75 during the intraday trades which translated in to gains of 1.35%.

The Nifty metal Index ended the day at 8,268.40 with gains of 0.67%, outperforming the benchmark Nifty -50 index that ended ended the day 0.12% lower

Key gainers among metals

Steel Authority of India Ltd (SAIl) with gains of more than 5% led the gains for Metal Index with National Aluminium company (NALCO) not much behind also gaining close to 4%. Among others NMDC rebounded and gained around 2% while Tata Steel also saw similar gains on Wednesday during the intraday trades

What’s led to gains for metal stocks?

The concerns have remained elevated around metal stocks looking at weak China demand and also the rising trade war concerns amidst tariffs being announced by the US President Donald Trump.

In an effort to support faltering industries, Trump did propose 25% import duties on steel Aluminium. The same led to pressure on metal stocks in previous few sessions.

However analysts say that the Tariffs been announced till now will have limited impact on Indian manufacturers.

JM Financial Institutional Securities said that Steel tariffs are unlikely to impact industry prices / demand in a meaningful way given US is a relatively small market. Steel imports accounted for around 23% of American steel consumption in 2023 with Canada, Brazil and Mexico being the largest suppliers. The global industry might see a marginal surplus, if at all with negligible impact on prices as per JM Financial which thereby sees minimal impact of US tariff imposition on Indian steel players.

The concerns may be more around Hindalco Industries considering its US subsidiary Novelis contributes significantly to Hindalco’s operating profits. However JM Financial believes that Novelis’ earnings will see minimal impact from the increase in tariffs on aluminium to 25% by the United States of America given significant recycling dependence at over 60% blunts any possible meaningful impact on Novelis. Further management remains confident to receive exemptions as granted the last time a similar duty was imposed, said analysts

Disclaimer: The views and recommendations made above are those of individual analysts or broking companies, and not of Mint. We advise investors to check with certified experts before taking any investment decisions.