Metal Stocks Outlook
for the week – 15 to 18.11.2016
Free Intraday Tips : Join Our Whatsapp No : 9841986753
Stocks of major metal and mining companies are seen trading
with a positive bias next week,
tracking the rise global prices of metals. Though the broader
markets will likely witness volatility
next week, the Nifty Metal index is expected to outperform.
Earlier this week, stocks of metal companies had risen
tracking the surge in global metal prices
following president-elect Donald Trump's promised to spend a
significant amount of money on
building infrastructure in the US, indicating a $500-bln
spend. Following the speech, prices of
copper, aluminium, and zinc surged overnight on hope of a
likely rise in demand.
Trump is also likely to impose higher tariffs on imports
from China, which is seen as beneficial for
metal companies in countries like India. Market participants
would be eyeing any development
related to imposition of anti-dumping duty on colour-coated
steel products.
Anti-dumping duty is a trade barrier that would protect the
local steel makers from cheap imports
coming from China and South Korea. Steel companies are
trying to hike prices as coking coal prices
trebled in last couple of months. Poor demand scenario thus
can be a
spoilsport in this regard. Flat product prices (of steel)
were recently hiked, however, there is
expectations of discounts in light of weak demand. In that
case, we expect stronger margin
contraction in next two quarters. Markets will remain shut
Monday on account of Guru Nanak
Jayanti.
