CNX Metal index hits fresh 52-week low

Thus far in 2015, CNX Metal index has underperformed the market by falling 14% compared to 1% rise in the Sensex.

Shares of  metal companies were under pressure, with the National Stock Exchange (NSE) CNX Metal index hitting fresh 52-week lows in intra-day trades, after the Greek debt crisis worsened and Greece’s exit from the Euro zone seemed inevitable.

Hindalco Industries, Tata Steel, Jindal Steel & Power (JSPL), Vedanta, GMDC and National Aluminium have touched their respective intra-day lows on the NSE.

At 1055 hours, the CNX Metal index was down 3% at 2,212 compared to a 2.1% fall in the CNX Nifty. The metal index hit a fresh 52-week low of 2,211 on the NSE in intra-day trades.

Thus far in 2015, the CNX Metal index has underperformed the market by falling 14% compared to a 1% rise in the benchmark index.

Angel Commodities expects base metal prices to trade lower as Chinese demand has failed to pick up yet despite stimulus measures by the biggest consumer.

“Manufacturing activity in China shrank for the third straight month in May as demand remained soft, raising the chances of more stimulus to boost growth in the biggest consumer. Fears of a rate hike by the Federal Open Market Committee (FOMC) in 2015 along with persistent uncertainty over Greece will take a toll on prices of base metals,” Kaynat Chainwala, an analyst tracking non–agri commodities and currencies at Angel Broking said in a recent report.

Among individual stocks, Tata Sponge Iron and Jindal Saw were down 5% each, while Hindalco, JSPL, Steel Authority of India, JSW Steel, NMDC, Tata Steel, Vedanta and Coal India were down 3%-4% each on the NSE.