Metal shares witnessed selling pressure as US President Donald Trump said he would restore tariffs on metal imports from Brazil and Argentina.
The Nifty Metal index witnessed heavy selling pressure after US president Donald Trump decided to reimpose tariffs on imports of steel and aluminium from Brazil and Argentina after accusing the countries of a "massive devaluation" of their currencies that hurt US farmers.
The move, which was announced by Trump on Twitter on Monday, sharply escalates trade tensions with the two struggling Latin American economies as they build closer ties with China.
In a tweet on Monday, Trump said that Brazil and Argentina had been presiding over a "massive devaluation of their currencies", which was not good for the US farmers.
"Therefore, effective immediately, I will restore the tariffs on all steel & aluminum that is shipped into the US from those countries. The Federal Reserve should likewise act so that countries, of which there are many, no longer take advantage of our strong dollar by further devaluing their currencies," he said.
The US is Brazil's biggest customer for steel and Brazil is the world's 10th biggest exporter of steel, according to the US Department of Commerce.
Among metal stocks, Steel Authority of India (down 3.42%), Tata Steel (down 3.13%), Jindal Steel & Power (down 3.07%), NMDC (down 2.99%), JSW Steel (down 2.35%), Hindalco Industries (down 2.24%), Vedanta (down 2.04%), Hindustan Copper (down 1.36%), National Aluminium Company (down 1.27%) and Hindustan Zinc (down 0.02%) edged lower.
The Nifty Metal index was down 2.49% at 2,567.20, underperforming the S&P BSE Sensex which was trading 0.24% lower at 40,704.37.
In other news, NMDC announced a disappointing production and sales numbers in November 2019. The company's total iron ore production in November 2019 was 2.94 million tonnes as compared to 3.29 million tonnes in November 2018, recording a decline of 10.64%. The iron ore sales remained flat in November 2019 at 2.79 million tonnes.
Meanwhile, the Supreme Court has reportedly prohibited Jindal Steel & Power to sell its Jindal Iron Ore stock.
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