Nifty Metal index slides 5%, records sharpest intra-day fall in nine months

The Nifty Metal index declined 5% to an intra-day low of 11,855.85 on the National Stock Exchange during Friday’s trade. The fall marked the sharpest intra-day decline for the index in the past nine months.
At around 10:09 am, the metal index was the worst-performing sectoral index, compared with a 0.53% decline in the benchmark Nifty 50.

Stock-wise movement

Shares of several metal companies recorded sharp losses in intra-day trade. Hindustan Copper declined 11% to ₹680, while National Aluminium Company fell 10% to ₹387.50. Vedanta was down 8% at ₹702.40, Hindustan Zinc slipped 7% to ₹663.25, Hindalco Industries declined 6.5% to ₹957.90, and NMDC fell 6% to ₹79.87.
Steel stocks also traded lower. Tata Steel, Jindal Steel, JSW Steel, Steel Authority of India, Lloyds Metals, and Jindal Stainless declined between 3% and 5%.

Recent performance

The decline followed a strong rally in metal stocks over the past month. Several stocks in the sector had gained up to 56% during this period and touched record highs in the previous session.
Over the past month, the Nifty Metal index had risen 16%, significantly outperforming the broader market, while the Nifty 50 had declined by about 2%.

Global cues

Global commodity markets also remained volatile. According to Bloomberg, trading on the London Metal Exchange was delayed for about an hour on Friday due to a technical issue, following a week of heightened volatility in metal prices.
In overseas markets, precious metal prices came under pressure as the U.S. dollar strengthened amid developments related to leadership changes at the U.S. Federal Reserve.

Market context

Despite Friday’s decline, several metal stocks continue to trade higher on a monthly basis. Hindustan Copper remains up 35% over the past month, while shares of Vedanta, Hindalco Industries, Hindustan Zinc, Tata Steel, Jindal Steel, and JSW Steel have gained between 9% and 19% during the same period.​