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Nifty Metal index slumps 3%; JSPL, SAIL, Tata Steel top losers

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Metal stocks declined on Wednesday, with the Nifty Metal index down about 3 percent in the afternoon session.

Nifty Metal index slumps 3%; JSPL, SAIL, Tata Steel top losers
Metal stocks declined on Wednesday, with the Nifty Metal index down about 3 percent in the afternoon session.
A consistent global economic slowdown and domestic liquidity crunch, along with a lacklustre demand from both auto and construction companies have weighed on metal prices in recent times.
The automobile industry in India has been experiencing major stagnation for the past four quarters.
"On the demand front, existing concern on auto has been exacerbated by the seasonal weakness in construction. Going ahead, we view challenges on profitability for all companies as the raw material cost stays robust primarily due to high iron ore cost. That said, companies with capacity ramp-up potential such as JSPL are expected to fare relatively better," Edelweiss said in a note.
The brokerage house has retained its cautious outlook on the sector. It has a 'Buy' call on JSPL, 'Hold' on JSW Steel and Tata Steel, and 'Reduce' on SAIL.
At 12.50 PM, shares of Jindal Steel and Power declined over 7 percent, the state-owned Steel Authority of India (SAIL) fell about 5 percent, JSW Steel was down 6.2 percent while Tata Steel dropped 3.6 percent.
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