Tata Steel Top Gainer, Miniratna MOIL Shines: Monday’s Metal Rally Driver?

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Tata Steel Top Gainer, Miniratna MOIL Shines: Monday’s Metal Rally Driver?
Credit: © Reuters.

By Malvika Gurung

Investing.com -- Global brokerage firm Jefferies (NYSE: JEF ) has grown positive on Indian metal stocks after turning cautious on the country’s steel sector in January last year. 

The leading brokerage’s top pick in the Indian metal sector is the Tata Group’s mega-cap stock Tata Steel (NS: TISC ), followed by the country’s biggest aluminium manufacturer Hindalco (NS: HALC ).

According to Jefferies, the worst-margin quarter for Indian steel and a ‘big chunk’ of earnings cuts for Tata Steel and Hindalco are left behind. 

This, in conjunction with China beginning to ease its Covid-19 restrictions and support the ailing property sector in order to stabilise its economy, is likely to drive a recovery in metal demand in 2023, stated Jefferies.

"If the US Fed rate hikes slow as CPI decelerates, and if China continues to relax Covid restrictions, then the cyclical bottom in metals might be close, if not behind," the global research firm added.

China is the largest consumer of metals in the world and a significant market for Indian metal companies.

As a result, metal stocks are on a rise on Monday. Tata Steel and Hindalco are top gainers on Nifty50 , surging over 4% in the session.

Nifty Metal is the best-performing sectoral index in the Nifty umbrella on Monday, up 1.8% at the time of writing, led by the Miniratna company MOIL (NS: MOIL ).

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