Metal Stocks Surge as Inflation Eases in India and US

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  Metal stocks surged on May 14 as retail inflation softened in both India and the US.
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  Tata Steel led the rally with a 4% surge, buoyed by strong Q4 results and positive brokerage outlooks.
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  NALCO rose 3.73%, SAIL 3.26%, Jindal Stainless 2.82%, NMDC 2.74%, and Hindustan Copper 2.52%.

Metal stocks rallied sharply on May 14, as easing retail inflation data from both India and the US lifted investor sentiment. A positive shift in US-China trade relations also fueled the upward momentum, reducing recessionary concerns and prompting a broad-based buying in metals and allied sectors.

The Nifty Metal index emerged as the top sectoral gainer, rising 2.7%, while the Nifty Realty index followed with a 2% jump, buoyed by declining raw material costs. Tata Steel led the rally within the metal pack, surging over 4% as investors reacted positively to the company’s Q4 results and bullish calls from brokerages.

Among other notable gainers, shares of NALCO advanced 3.73%, SAIL gained 3.26%, and Jindal Stainless rose 2.82%. State-run NMDC and Hindustan Copper were also up, climbing 2.74% and 2.52%, respectively.

The rally comes on the back of India’s consumer price inflation (CPI) easing to 3.16% in April, down from 4.85% in March. Analysts expect this downward trend to pave the way for further monetary policy easing. Sakshi Gupta, Principal Economist at HDFC Bank, said the RBI may consider a 25 basis point rate cut in its June policy meeting.

“With inflation under control, the RBI’s focus is expected to shift towards supporting growth. We anticipate another 50 bps reduction in rates over the course of the year”, added Aditi Gupta, Economist at Bank of Baroda.

Gaura Sen Gupta, India Economist at IDFC First Bank, said domestic factors could allow policy easing of up to 75 basis points in FY26. “A negative output gap and soft commodity prices are likely to keep core inflation contained”, she noted.

Globally, US inflation showed signs of moderation. Headline CPI rose 0.2% in April, below market expectations of 0.3%. The annual CPI eased to 2.3% from 2.4% in March, bolstering hopes of monetary easing by the US Federal Reserve.

In a major geopolitical development, the US and China agreed to reduce reciprocal tariffs, signaling a thaw in trade tensions. This move is seen as an attempt to avert a global economic slowdown, further strengthening investor confidence in cyclical stocks like metals.



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