Metal shares slipped for the second day in a row, ending a six‑day rally as investors took profits after a big run‑up in base‑metal prices.
Why the sharp fall?
The recent surge in copper, aluminium, gold and silver pushed prices to high levels. Many traders decided to lock in gains, leading to a broad sell‑off. Silver futures on the MCX fell to around Rs 4,000 per kilogram, while gold, aluminium and copper futures each dropped about 1%.
Impact of commodity‑index rebalancing
Analysts expect large outflows from commodity‑focused funds during the annual rebalancing. Roughly $6.8 billion could leave gold funds and a similar amount could exit silver funds, adding further pressure on prices.
Big losers in the sector
- Hindustan Zinc – down more than 5% as silver prices fell.
- NALCO (National Aluminium Company) – fell around 5%.
- Jindal Stainless Steel, Jindal Steel & Power, Vedanta, Hindustan Copper – each slipped about 4%.
- Hindalco Industries, NMDC, SAIL, JSW Steel, Tata Steel – fell over 2%.
- APL Apollo Tubes, Adani Enterprises, Welspun Corp – each dropped more than 1%.
Tata Steel’s record production
Despite the market dip, Tata Steel announced that its Indian plants produced a record 6.34 million tonnes of crude steel in the December quarter, up 11% from the same period last year. The boost came mainly from higher output at its Jamshedpur and Kalinganagar facilities.
Recent market backdrop
Before the drop, the Nifty Metal index had risen for six straight sessions, gaining almost 5% overall and climbing more than 11% over the past month. The index closed flat on Wednesday, then slipped about 3% on Thursday to a one‑week low of 11,215 – its worst single‑day fall since April 2025.
Takeaway for investors
Profit‑taking after strong price gains can quickly reverse market sentiment, especially when large fund flows are expected to shift. Keep an eye on commodity‑index rebalancing dates and watch how key metal stocks respond.
Remember, this is my perspective, not a prediction. Do your own research before making any investment decisions.