Metal Stocks Slide Up to 14% on Fed Rate Hold
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- Hindustan Copper led the metals pack lower, plunging over 14% in the past month, followed by Hindustan Zinc at nearly 13%, Tata Steel and JSW Steel around 11%, Adani Enterprises at 10%, and Hindalco Industries at 7%, with the correction in the top two names following a sharp earlier-year rally.
- Jerome Powell announced the Fed would keep policy rates unchanged on Wednesday, citing inflation 'not coming down as much as they had hoped' amid Middle East tensions and Trump's tariff flip-flops, with investors now eyeing the RBI's April MPC meeting.
- Elara Capital reported hot-rolled coil prices surged roughly 13% and primary rebar nearly 20% quarter-to-date, flagged a 19% spike in international thermal coal prices over two months, and noted the Middle East accounts for approximately 8% of global aluminium production facing supply disruption risk.
- Global crude steel production fell around 7% year-on-year to 147.3 million tonnes at the start of CY26, with China exporting 25–30 million tonnes of steel annually to the Middle East, where shipping disruptions could redirect shipments toward Southeast Asia and domestic markets.
- JM Financial said Indian steel spreads are expected to improve sequentially in Q4 FY26 following the safeguard duty implementation in late December, naming JSPL and Tata Steel as top picks — the latter benefiting from CBAM-driven higher European prices aiding Corus margins.
- India's steel exports to the Middle East have slowed amid freight volatility and rising shipping risks, with EU-bound cargo increasingly rerouted via the Cape of Good Hope, extending transit times by 10–20 days and significantly raising freight costs.
Why it matters: Indian metal stocks fell up to 14% on the Fed pause despite rising commodity prices — HRC up 13%, rebar up 20% — exposing macro-driven selling versus improving fundamentals. With Middle East shipping disruptions rerouting cargo via the Cape of Good Hope and adding 10–20 days transit, steel exporters face margin pressure that could deepen if conflict escalates.
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