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Here are key factors behind the surge in these shares:
Global Tailwind
Global metal prices received a boost after Fed Chair Jerome Powell signalled that rate cuts are imminent during his Jackson Hole speech on Friday. The speech sparked a risk-on rally on Wall Street, followed by a surge in prices of risky assets as well.
Cues From China
More developments coming in from China, where the country has halted approval of new steelmaking capacity. As a result, prices of HRC, Billet and Rebar have improved in the Chinese market by 1%, 2% and 1% on a week-on-week basis.
Base Metal Price Bounce
The global prices in base metals have also seen a bounce with prices of Aluminum, Zinc, Lead and Copper improving by 7%, 5%, 4% and 2% respectively on a week-on-week basis.
The move came after Chinese Zinc smelters met to contemplate output cuts in order to stem losses.
Aluminum prices have risen by 15% in the last one month.
Price Hikes
According to PhillipCapital, JSW Steel has already hiked rebar prices by 750 per tonne, while Jindal Stainless Ltd. has increased the price of its Stainless Steel coil by ₹3,000 per tonne for its 304 / 316 series.
SAIL is currently the top gainers on the Nifty Metal index, currenly trading with gains of 5%, followed by NALCO, which is trading with gains of a similar quantum. Hindustan Copper, Hindalco and Vedanta shares are trading with gains between 3% to 4% in today’s session.
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