GOLDEN RULES FOR TRADING

Metal Stocks Outlook for the week – 01 to 05.02.2016 Seen trading with negative bias next week

Metal Stocks Outlook for the week – 01 to 05.02.2016
Seen trading with negative bias next week

Stocks of metals and mining companies are seen trading with a negative bias next
week due to weak Oct-Dec earnings and as the government has said that no decision
has been taken regarding the minimum import price on certain steel products.

Although the steel ministry was reportedly working with banks to resolve financial
issues in the sector, absence of any decision regarding the minimum import price is
likely to hurt the domestic steel producers who have been adversely hit by cheaper
imports from China, Japan and South Korea.

The steel companies are all expected to post weak quarterly earnings as there has been
a sharp fall in steel prices and cheap imports have not been curbed despite the
implementation of safeguard duty by the government. There is no hope for a revival
as long as fundamental problems of the sector persist. Vedanta Ltd's consolidated net
profit came down 99% on year to 179.1 mln in Oct-Dec, whereas JSW Steel has
posted a consolidated net loss of 9.2 bln rupees during the same period.