Metal stocks NALCO, Hindalco, Vedanta gain up to 13%: Here's why

Even as the headline indices continued to slump for the seventh straight day on lingering worries of FII outflow, metal pack curbed the losses partially. At the time of writing the copy close to the market close, Sensex was down 250 points, while the Nifty fell 88 points to 23,445 levels,

Nonetheless, Nifty Metal pack showed resilience and was up over 2 per cent at 9,013.2. The index over the past one month has cracked 10 per cent, while the broader Nifty 50 during the same time has seen a dent of over 5 per cent.

Of the 15 stocks constituting the index, there was seen a mixed trend, with as many as 9 stocks in the green and other including the likes of Ratnamani, Jindal Stainless, Adani Enterprises, APL Apollo and Welspun leading the cut falling up to 2 per cent.

Meanwhile, top gainers from the pack included stocks like NALCO up over 9 per cent, and at the day's high it gained nearly 13 per cent to Rs 9,129.65 per share. Other stocks showing strength included Hindalco, Vedanta, Tata Steel and NMDC up between 2-4 per cent.

Still others trading with gains of one 1 per cent and more are JSW Steel, JSPL and SAIL among others.

Zee Business research attributes today's sharp gains in metal shares as China will withdraw export tax rebate on aluminum and copper from December 1. Until thus far, products made from aluminium and copper were offered a tax rebate of 13 per cent.

Amid the development, there has been reported a sharp surge in the aluminium price by up to 8.5 per cent on the London Metal Exchange (LME). In the year 2023, the country exported aluminium totalling to 5.7MT.

The withdrawal of export tax rebate is likely to weigh negatively on the supply of these metals.