The Nifty metal index was down 1.3% around 11:45 am and trading at 6,681, with 12 scrips in the red in the 15-stock index.
The top losers in the day’s trade were National Aluminium Company (3%), Jindal Stainless (2.6%) and Tata Steel (2.6%). Both National Aluminium and Jindal Stainless hit their 52-week highs on Monday.
Meanwhile, Jindal Steel & Power, Hindustan Copper, NMDC, Steel Authority of India (SAIL), Ratnamani Metals & Tubes, JSW Steel, Hindalco Industries, Vedanta and APL Apollo Tubes shares fell between 2% and 0.53% around this time.
The subdued sentiments in metals were triggered after a fall in nonferrous metals prices on the London Metal Exchange (LME).
Kranthi Bathini, Director-Equity Strategy at WealthMills Securities attributed this downfall to rating agency Fitch’s cut to the US’ credit rating from AAA to AA+. “On Tuesday, Fitch said that it expected fiscal deterioration over the next three years and that is likely to impact the global growth prospects which will in turn impact the metal demand,” Bathini said.
The dollar strengthened after a survey from the Federal Reserve showed US banks reported tighter credit standards and weaker loan demand during the second quarter, a sign rising interest rates are having an impact on the economy, Reuters reported.On the other hand, news from China did not inspire much confidence among investors as the country released further policy guidelines without any concrete measures to boost its economy, the Reuters report pointed out. Beijing and Shenzhen said over the weekend that they would implement measures to better meet homebuyers’ needs, without giving details.
The sentiments remained weak in the broader markets as well, with frontline indices registering sharp declines. The Nifty50 was down by 186.15 points or 0.94% at 19,547.40. The S&P BSE Sensex plunged over 600 points or 0.94% to 65,833.20. Nifty Bank was trading at 45,071.65, down by 520.85 points or 1.14%.
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