Jindal Steel & Power (JSPL) and Hindalco Industries were up 5 per cent and 4 per cent, respectively. Tata Steel, JSW Steel, Vedanta, Steel Authority of India (SAIL) and NMDC were up in the range of 2 per cent to 3 per cent on the National Stock Exchange (NSE).
At 11:07 am, Nifty Metal Index, the largest gainer among sectoral indices, was up 2.6 per cent, as compared to 0.68 per cent rise in Nifty 50 index. In the past two trading days, the metal index has surged nearly 5 per cent, against a marginal 0.2 per cent gain in the benchmark index.
Investor sentiment perked up after US national security adviser Robert O’Brien on Saturday said an initial trade agreement with China was still possible by the end of the year.
Also, on Friday, US President Donald Trump and China's Xi Jinping, both, had underscored their desire to sign an initial trade deal and defuse a 16-month tariff war that has lowered global growth, providing a welcome boost to financial markets, according to Reuters report.
Among individual stocks, Tata Steel was up 4 per cent to Rs 415 in intra-day trade today. It has rallied 8 per cent in past two trading days.
Analysts at JP Morgan have ‘overweight’ rating on the stock as the brokerage believes Tata Steel looks ideally positioned for some rebound in India demand given its around 19MT steel portfolio split between Flats and Longs.
“We remain ‘overweight’, as steel prices and domestic demand pick up from here; margins should recover from Q2 lows. Assuming the global macro does not deteriorate further, and any trade war easing improves sentiment towards commodities, we see Tata Steel ideally positioned for a cyclical rebound given low ownership and attractive valuations,” JP Morgan said in a note.
Regarding metals as a sector, Edelweiss, in a report dated November 14, said that stock prices and earnings of such companies would bottom out in Q3FY20.
"Spot raw material (RM) spreads for domestic players have inched up 3 per cent to Rs 20,965/t as a result of uptick in domestic hot rolled coil (HRC) HRC prices and fall in international coking coal prices—down a further $10/t thus far in Q3FY20. If the price hike sustains, we believe earnings of ferrous players are likely to bottom out in Q3FY20 as spreads will become increasingly favourable hereon," the brokerage firm said.