Metal stocks fire on China data; Hindustan Copper surges 9%
An official factory survey on Sunday revealed that China's manufacturing activity had expanded for the first time in six months in March. The world's largest producer and consumer of copper saw its most-traded May copper contract on the Shanghai Futures Exchange closing day-time trade 1.1% higher at 73,100 yuan ($10,110.79) per metric tonne.
China's industrial data fired the domestic on Monday with a 9% surge in , the top gainer in the Nifty metal index. , , were also among other notable gainers, which shot up by up to 7%. , whose copper unit in Mundra has begun operations, was also up 3%.The trigger for global metal prices was an official factory survey on Sunday showing China's manufacturing activity expanded for the first time in six months in March. China, which is the world's largest producer and consumer of copper, saw its most-traded May copper contract on the Shanghai Futures Exchange closed day-time trade 1.1% higher at 73,100 yuan ($10,110.79) per metric tonne, having notched a 5.4% rise in March — its biggest monthly gain in 16 months, Reuters report said.
This had a positive rub-off impact on Hindustan Copper, which jumped to the day's high of Rs 304.
"The April series has started with very strong data and global sentiments are pretty good. China is coming back with a bang (3:35) their PMI data was better than expected so that is adding fuel to the rally. I think this time it would not be a domestic rally, but a global-led rally because the Nasdaq is at a lifetime high, the Dow Jones is also at the lifetime high. Now it is time for the Nifty and Bank Nifty to hit new highs," Aditya Arora of Adlytick told ET Now.
The Nifty Metal index hit a new 52-week high of 8,551.95 on Monday, gaining 4% or 300 points over Thursday’s closing level. Around 2:15 pm, 14 stocks from the 15-share index were trading in the green. State-run , National Aluminium Company (), Steel Authority of India (), , , Jindal Steel & Power, and Ratnamani Metals & Tubes were up by up to 5% around this time. The only laggard was , which was down 1.27%.
Commenting on the day's trend, analyst Nilesh Jain, Assistant vice-president (AVP), Equity Research Technical and Derivatives at Centrum Broking, said the Nifty metal index has given a fresh breakout as it scaled a fresh record high. He sees the structure remaining strong for levels of 8,800-9,000. Within the metal space, his top pick is SAIL, which he said is poised to test Rs 150+ and can be added on declines. The stock has support at 134.
He also picked as a stock to buy. It could go up to Rs 900+ with support at Rs 845.
Metal stocks have witnessed a strong rollover going into the April Series, said Sudeep Shah - deputy vice-president & head of the technical and derivative research desk at SBI Securities. "Nifty Metal Index has witnessed a volume-based breakout after a 3-month consolidation and is headed for 8,900-9,000 levels with 8,250-8,300 zone acting as a support," Shah said as he picked Tata Steel and JSW Steel as stocks that offer potential for outperformance in the coming weeks.
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(Disclaimer: Recommendations, suggestions, views and opinions given by the experts are their own. These do not represent the views of Economic Times)
Source: Stocks-Markets-Economic Times
