Tata Steel, JSW steel, Jindal Steel and power Ltd( JSPL) , Steel Authority of India Ltd (SAIL) saw their share prices rise up to 5.1%. The same helped gain for the Nifty metal index that ended the day with gains of 2.49%.
The strong Industrial growth numbers in China lifted the sentiments for steel stocks and metals and mining pack as a whole.
China industrial output increased by 7% in January and February compared to the same period last year, as per the the National Bureau of Statistics announcements in China on Monday, which as per Bloomberg news report was significantly faster than what economists had predicted. Forecasts were not met as fixed-asset investment growth accelerated to 4.2% suggested Bloomberg . The 5.5% increase in retail sales was also in line with projections.
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China is the largest consumer of commodities in the world and therefore any pick up in China demand can lift overall global steel demand and prices of commodities. Weak China demand had meant that exports from China remained elevated putting pressure on global steel prices too. The steel prices in India had also remained in a downtrend .
As per Kotak Institutional Equities 14 March report, in 4QFY24, average domestic Hot rolled coil (HRC) and rebar prices fell by 4% and 7% respectively, while Chinese export offers went up by 2%.
Steel margins are expected to be under pressure sequentially in 4QFY24, as indicated by declining steel prices and rising iron ore and coking coal prices, as per Kotak analysts.
The rising China demand can support iron-ore and coal prices too. The iron-ore prices that had risen to around $150 a tonne (ex- China) had fallen close to $110 a tonne levels . This had led NMDC stock price to fall 18% between 5th March to 15Th March period. NMDC share price aslo rebounded 2.12% on Monday.
Share prices of other mining stocks as Coal India also ended the day with gains 1.63% on Monday
Disclaimer: The views and recommendations made above are those of individual analysts or broking companies, and not of Mint. We advise investors to check with certified experts before taking any investment decisions
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Published: 18 Mar 2024, 05:04 PM IST
Meet Mahtab Ahmad, known for his keen insights into the latest trends and news. Join Mahtab on his blog, where every post is a exploration of the ever-evolving now.
