Metal stocks were under pressure on Thursday with the Nifty Metal index falling over 2% to 11,268.10. The decline was led by Hindustan Zinc, NALCO, Hindustan Copper and Vedanta.
Hindustan Zinc emerged as the worst-performing metal stock, falling over 5% to trade at Rs 596.35, its lowest level since Dec. 19.
National Aluminium Company Limited (NALCO) and Hindustan Copper fell 4.81% and 4.73%, respectively, while Vedanta shed 3.78%.
The decline comes as silver, copper and gold fall on the Multi Commodity Exchange of India. Silver futures, due for a March 5 expiry, were trading nearly 1% lower on Thursday at Rs 2,48,252. On Wednesday silver had snapped a four-day rally, dropping over 3% to Rs 2,51,72 per kilogram. However, MCX silver futures had hit a fresh record-high on Wednesday.
In overseas markets, silver pared its early-morning gains and is now trading slightly higher at $77.72 an ounce.
Similarly, Copper futures on the MCX were trading 0.56% lower at Rs 1,300.45, while spot copper was trading 0.15% higher at $586.90.
Futures for copper, nickel and zinc had declined more than 2% at the close of trading on the London Metal Exchange, trimming sharp gains seen over the past couple of weeks as a broad-based flood of investment in China’s domestic metals markets pushed prices up.
While Nickel settled 3.4% lower at $17,895 a ton on the LME as of 5:55 p.m. London time, Copper closed 2.6% lower at $12,899.50, as all other major metals declined on the exchange.
Aluminium was down 1.29% and Lead fell as much as 0.79% during the close. According to analysts at Kotak Securities the fall was on the back of profit booking following a strong rally that had pushed prices to record highs earlier in the week. “The move was due to firmer U.S. dollar and caution ahead of a heavy slate of U.S. economic data that could shape the policy outlook of the Fed,” Kotak Securities added.
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