The BSE Metal index fell almost 5%, while the BSE Energy fell 2.5%. Metals stocks such as Tata Steel, SAIL, Jindal Steel and JSW Steel fell between 4% and 5%.
“Commodity stocks are seeing a decline, largely due to commodity price cooling and uncertainty in global markets, citing the resurgence of Covid-19 cases in China,” said Ajit Mishra, analyst at Religare Broking. “Going forward, we expect commodity-driven sectors such as metals, mining and oil to remain highly volatile.”
After a sharp rally over the past month in the wake of the Russia-Ukraine war, metals – ferrous and nonferrous – and crude oil have seen a turnaround. Prices of base metals such as aluminum fell 3%, while zinc and lead each corrected 8%. Global steel prices have corrected 4% in the past week, while iron ore prices have fallen 12% over the same period.
“The new outbreaks of Covid-19 in China and Hong Kong have threatened to slow the pace of the broader recovery, clouding the outlook for industrial metals demand,” said Pankaj Pandey, head of research at ICICI Securities. “This is a temporary setback, but it doesn’t mean the story is over for metals stocks. Structurally, Indian metals companies are well positioned for medium to long-term growth.”
“Domestic steel demand is expected to improve with increased infrastructure investment and the price outlook is supported by solid international prices,” said Pallav Agarwal, an analyst at Antique Stock Broking.
This post Stocks: Commodity, energy stocks plunge was original published at “https://economictimes.indiatimes.com/markets/stocks/news/commodity-energy-stocks-plunge/articleshow/90245028.cms”
