Metal Stocks Surge as RBI Announces 50 bps Rate Cut – JSW Steel, Tata Steel Lead Gains

Market Performance

Metal stocks experienced a strong rally on June 6 after the Reserve Bank of India announced a surprise 50-basis-point (bps) rate cut, exceeding market expectations of a 25-bps reduction.

• Nifty Metal Index surged 1.4%, trading near 9,360 levels.
• Sensex jumped nearly 800 points to 82,240.
• Nifty 50 climbed 1%, crossing the 25,000 mark.

Top Gainers in the Metal Sector

Here's how key metal stocks performed:

• JSW Steel: Top gainer, up 4% at ₹1,010 per share.
• Jindal Stainless Steel: Rose 3%.
• Hindustan Zinc: Gained 2%, supported by rising silver prices.
• Welspun Corp, NALCO, Hindustan Copper, NMDC, Adani Enterprises: Up over 1.6%.
• Tata Steel, Hindalco, Jindal Steel & Power: Gained 1% each.
• SAIL, Vedanta: Traded with marginal gains.

RBI's Key Policy Decisions

The RBI's Monetary Policy Committee (MPC) made significant changes:

• Repo Rate Cut: Reduced by 50 bps to 5.5% (from 6%).
• CRR Reduction: Slashed by 100 bps to 3% (from 4%).
• Policy Stance Shift: Changed to 'neutral' from 'accommodative.'

Economic Outlook & Impact on Metals

The RBI revised its inflation forecast for FY26 to 3.7%-4% while keeping GDP growth projection steady at 6.5%.

• The rate cut is expected to boost real estate demand, benefiting metal companies supplying raw materials.
• Nifty Realty Index surged 4%, reflecting optimism in rate-sensitive sectors.

Summary

Metal stocks, including JSW Steel, Tata Steel, and Hindalco, surged after the RBI's aggressive rate cut. The move signals economic strength, driving investor confidence in rate-sensitive sectors. With inflation under control and stable growth prospects, metal stocks remain in focus for further upside.