Tata Steel among steel stocks rallying on positive outlook; Nifty Metal jumps 6.5% in 2 sessions - Check what analysts say
Among heavyweights, Tata Steel stock is the top Nifty gainer, up over 6 per cent, followed by JSW Steel up almost 5 per cent on the NSE intraday during Tuesdays trading session.
Metal shares are on a roll for the second straight session on Tuesday, as the Nifty Metal index has rallied nearly 6.5 per cent in the last two days. Amid this, steel stocks like Tata Steel, JSW Steel, and Jindal Steel were among the major contributors today.
The rally in the metal stocks could be attributed to stable demand in India as crude steel production stood at 10.4mn tonnes, up 6 year-on-year (YoY) in November 2022, while the consumption also surged 7 per cent YoY to 9.6mn tonne in the previous month, as per Philip Capital report.
Among heavyweights, Tata Steel stock is the top Nifty gainer, up over 6 per cent, followed by JSW Steel up almost 5 per cent along with Aditya Birla Group-backed Hindalco up nearly 6 per cent on the NSE intraday during Tuesday’s trading session.
According to Philip Capital's report, India’s net finished steel imports were at 260Kt in November 2022 as compared to 230Kt in October 2022.
While in the broader markets, top Nifty Metal Index gainer Jindal Steel jumped more than 8 per cent, followed by NALCO - which was up almost 7 per cent, SAIL - up nearly 6, and Hind Copper - up almost 5 per cent on the NSE intraday basis.
"Going ahead, we expect cost-push, higher coking coal and iron ore prices, on the back of optimism around stimulus measures in China to aid global steel prices," Amit Dixit, Research Analyst, ICICI Securities said in a report on the metal sector.
The analyst believes that domestic steel producers might hike prices in January 2023 as the recent price hikes in global markets appear encouraging.
Similarly, Kunal Kothari, Research Analyst of Centrum Broking stated that China steel producers’ margin are at below pandemic levels and global steel prices continue to trend lower month-on-month.
“We believe negatives are factored in global steel prices and following triggers like inflation cool off, interest rates peak out and Covid relaxation in China can positively support steel prices,” the research analyst at Centrum Broking said in a report on the sector.
Get Latest Business News, Stock Market Updates and Videos; Check your tax outgo through Income Tax Calculator and save money through our Personal Finance coverage. Check Business Breaking News Live on Zee Business Twitter and Facebook. Subscribe on YouTube.