According to a
Earlier, Trump had tweeted that the U.S. and China are “VERY close” to signing a “BIG” trade deal, also sending equities higher.
Individually, Hindustan Copper Limited climbed 4.8 per cent, followed by Vedanta
Limited (4.37 per cent), Tata Steel
(3.8 per cent), SAIL (3.6 per cent), Jindal Steel (3.4 per cent), and National Aluminium Company Limited (3.2 per cent). Besides, shares of Coal India and NMDC gained in the range of 2 to 3 per cent.
The continued tariff/trade wars have affected the base metals industry during the whole of FY19, and in the current financial year, it has continued to depress the prices of base metals resulting in affecting the revenues and margins of non-ferrous manufacturers.
Any progress in the US-China trade deal would come in as a huge relief for metal stocks
which have been under pressure ever since the global trade war between the two countries began. Consequently, steel companies have witnessed contraction in margins, dragged down by lacklustre demand and lower global commodity prices.
In September quarter, lower commodity prices, fragile demand and slowing volumes throttled the performance of metal sector companies. For steel firms, heavy monsoon, liquidity issues and weakness in automobile sector further led to a slump in demand. All steel companies faced sagging volumes in the quarter, but they expect a recovery in the second half or the October-March period of FY20.
Margins of top steel firms- Tata Steel, JSW Steel, Jindal Steel & Power Ltd (JSPL) and SAIL contracted by Rs 1,200-2,400 per tonne in Q2. The margin squeeze was the most pronounced for JSW Steel. Ebitda for Tata Steel
Europe remained weak at $10 per tonne due to a fall in steel spreads, weak demand and planned summer shutdowns.