The metal stocks are off early lows after seeing deep cuts in opening trade. The focus is on the metal stocks as a result of the 25% tariff imposed on Canada and Mexico along with a 20% tariff on China. China, as per recent reports, has vowed to hit back. How this impacts global metal demand and commodity price will have a direct bearing on Indian metal shares.
US pauses military aid to Ukraine
What’s particularly interesting is that Donald Trump has decided to pause military aid to Ukraine. Not only does it mark a significant shift in US foreign policy, it also puts a question mark on the critical metal pact that the US and Ukraine were scheduled to sign.
Metal stocks see a weak run in 2025 so far
In the pre-open session, the Nifty Metal was down 1.43% at the 8,197.20 level. It fell the most among the sectoral indices. Though the Nifty Metal index is now off early lows, most of the metal stocks are trading on a cautious note or a wait and watch mode.
National Aluminium Company was the major loser in the Nifty Metal. It fell 3.3% to a low of Rs 173.51. It was followed by Welspun Corporation that dropped 3.1%, Vedanta (3%), Jindal Stainless (2.8%), and many others.
However, at 9.50 am, the Nifty Metal rebounded and was down 0.20% at the 8,299.85 level
The stocks of Vedanta, Tata Steel, Hindalco, JSW Steel, and others were dragging the index.
The fall in stock prices of metal stocks came after Donald Trump raised tariffs on Chinese imports to 20% from 10% earlier. The decision will take effect from March 04. In retaliation to the imposed tariffs by the US, Beijing may target American agricultural exports more aggressively now.
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The fall in stocks is across the board today. The Nifty 50 fell to the day’s low of 21,964.60, breaching the key support level of 22,000. The Sensex declined 452 points to an intra-day low of 72,633.54.
The Nifty 50 slid 5.9% month-on-month in February 2025.
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