Metal Stocks Outlook for the week – 25 to 29.01.2016
Tad
up on likely government support to steel firms
( www.rupeedesk.in )
Stocks
of metals and mining companies are seen trading slightly higher next week, as
Steel
Secretary Aruna Sundarajan has said that her ministry is working with banks to
resolve
financial issues in the sector. A package is required to address the sector's
financial
concerns, Sundarajan told news channel CNBC TV-18 in an interview
yesterday.
Though the government hasn't made any announcement of a floor price for
Imported
steel and steel products, the steel secretary said she expects the decision on
minimum
import price at the earliest. The sector is likely to receive another boost,
with
reports saying the Chinese government has laid out reform measures to deal with
the
steel supply glut by shutting junk companies, as Chinese steel companies
increased
prices of finished steel.
Though
Stocks of steel companies might see an uptick in the near term, they aren't
expected
to record a complete revival, as core problems remain. The fundamental
problems
do not seem to be going away for the metal sector and are expected to
continue
for the better part of this year. The continuous fall in commodity prices is
hurting
the sector and various measures taken by the government aren't enough to
help
the companies sustain.