Nifty Metal Stocks Rally: Hindustan Copper Leads Gains Amid Dollar Weakness

Metal stocks surged on Thursday, with Hindustan Copper jumping 6.6% to touch ₹361.80, while other key Nifty Metal constituents also posted gains. Vedanta, Adani Enterprises, National Aluminium, SAIL, NMDC, and Hindalco Industries saw intraday increases ranging from 0.5% to 1.3%.

The rally reflects a combination of global and domestic factors, influencing both investor sentiment and commodity pricing.

Market Performance and Key Drivers

The surge in metal stocks came after a weaker US dollar index, which makes dollar-denominated commodities cheaper for global buyers. The dollar index fell 0.49% to 98.86, marking its ninth consecutive session of decline and hitting the lowest level since October 29.

Other contributing factors include:

• US Payroll Data: November figures showed the largest drop in payrolls since early 2023, signalling a slowing labour market.
• Federal Reserve Expectations: Investors anticipate a 25-basis-point rate cut at the Fed’s December 12 meeting, with implied probabilities rising to 89% from 83.4% a week earlier.
• Geopolitical Tensions: US-Russia talks on the Ukraine conflict ended without breakthroughs, adding a risk premium to commodities.

These elements combined to lift base metal prices globally, influencing the Nifty Metal index.

Individual Stock Movements

• Hindustan Copper: Jumped 6.6% to ₹361.80
• Vedanta, Adani Enterprises, National Aluminium, SAIL, NMDC, Hindalco Industries: Gains ranged from 0.5% to 1.3%

The rally is driven by strong global demand, the weaker dollar, and supply-side constraints affecting major metals like copper and aluminium.

Global Commodity Context

• Copper: Benchmark LME three-month copper touched a record high of $11,541/ton, heading for the largest annual gain since 2017, up 31% YTD.
• Tin: Climbed 4.2% to $40,675/ton, reaching its highest level since May 2022.
• Aluminium: Up 1.1% to $2,897/ton.
• Zinc: Steady at $3,063/ton.
• Lead: Slight rise of 0.1% to $1,997.50/ton.
• Nickel: Advanced 0.6% to $14,895/ton.

The broader rally reflects expectations of US Federal Reserve rate cuts, a slowing dollar, and improving growth prospects in China.

Summary

Thursday’s session highlighted the resilience of Nifty Metal stocks:

• Hindustan Copper led gains with a 6.6% rise.
• Other Nifty Metal stocks saw modest intraday increases.
• Dollar weakness and US payroll data provided global tailwinds.
• Supply concerns and policy changes supported prices for copper, aluminium, and other base metals.

Overall, the rally underscores the sensitivity of metal stocks to global currency movements, US monetary policy, and supply-demand dynamics, with Hindustan Copper emerging as the standout performer.