Heard on the Street: Demand surge hopes lift metals
Shares of metal & mining companies surged tracing the intra-day rally on London Metal Exchange on Friday.
By Shailesh Menon, ET Bureau | Updated:
Shares of metal & mining companies surged tracing the intra-day rally on London Metal Exchange on Friday. The BSE Metal index closed over 6% higher due to solid gains listed by Hindalco Industries, JSW Steel and Sterlite Industries.
According to brokers, investors covered their short positions in metal counters on expectations that the plan to resolve the European debt crisis will prevent Greece from defaulting on their loans. The general feeling in the market is that large development projects across the world will get a leg-up once the credit crisis in Europe is contained within the continent.
"Investor believe, the demand for metals like copper, tin and aluminium will increase once development projects start taking off," said a Mumbai-based broker. "However, metals will correct in the days to come as data on development projects in China was declining to alarming levels.
Copper, being used in large quantities in China, will be the worst hit," the broker said. Shares of Hindalco Industries, JSW Steel and Sterlite Industries closed 8-11% higher at 142, 664 and 133, respectively, on the BSE on Friday.
(Contributed by Shailesh Menon)
According to brokers, investors covered their short positions in metal counters on expectations that the plan to resolve the European debt crisis will prevent Greece from defaulting on their loans. The general feeling in the market is that large development projects across the world will get a leg-up once the credit crisis in Europe is contained within the continent.
"Investor believe, the demand for metals like copper, tin and aluminium will increase once development projects start taking off," said a Mumbai-based broker. "However, metals will correct in the days to come as data on development projects in China was declining to alarming levels.
Copper, being used in large quantities in China, will be the worst hit," the broker said. Shares of Hindalco Industries, JSW Steel and Sterlite Industries closed 8-11% higher at 142, 664 and 133, respectively, on the BSE on Friday.
(Contributed by Shailesh Menon)
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