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Our Bureau

Mumbai, Jan. 5 Metal stocks witnessed a sharp rise on Monday with BSE Metal index gaining maximum among all the sectoral indices on the back of the second stimulus package announced by the Government.

The BSE Metal index gained 5.54 per cent. Top gainers among the steel stocks were Tata Steel (6.73 per cent), SAIL (6.97 per cent), Jindal Steel (5.50 per cent).

Aluminium and zinc producers also moved sharply with Sterlite Industries emerging the top gainers among the Sensex stocks with a gain of 9.82 per “As a part of the second stimulus package, countervailing duty was imposed on TMT bars and structurals and custom duty was imposed on zinc and ferroy alloys which will provide level playing field to the domestic steel producers,” said Mr Niraj Shah, Senior Research Analyst, Centrum Broking Private Ltd.

However, Mr Shah does not expect many changes in international demand for steel products with situation the turning from bad to worse. “Monday’s sharp rise in price is a short-term breakaway as the short and medium term outlook has not changed much even in the domestic market,” he said.

Meanwhile, according to a report, there was a sudden rise in demand for long structural products by 30 to 40 per cent while the prices have come down from an average of Rs 48,000-49,000 a tonne in August to Rs 32,000-33,000 a tonne. The good news for steel manufacturers is that the production cost of steel has also come down with fall in prices of raw material, including iron ore, which has also been favourable for steel stocks.

More Stories on : Stock Markets | Metals

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