Hindustan Copper shares spike over 8% to 13-year high as metal price nears $10,000
Hindustan Copper shares surged by 8.25% to ₹394 apiece, reaching the highest level since November 2010. The company benefits from rising copper prices and is well-positioned with infrastructure. Global copper prices hit a 2-year high due to manufacturing activity rebound.
Hindustan Copper, a state-owned mining company focused on extracting copper ore in India, witnessed a significant surge in its shares, climbing 8.25% to ₹394 apiece during today's intraday session, marking its highest level since November 2010.
The company's shares have consistently risen in line with movements in copper prices, positioning it to capitalise on the global surge in copper prices. As the sole copper ore mining company in India equipped with fully developed infrastructure facilities, Hindustan Copper is well-positioned to benefit from this trend.
During today's intraday trade, 3-month copper prices on the London Metal Exchange (LME) approached the $10,000 per tonne mark, reaching $9993.30 per tonne, a 2-year high.
The copper market experienced a notable resurgence in 2024 following a lackluster performance in 2023, driven by optimism surrounding the global economic recovery and increased demand for industrial materials.
While signs of improvement in manufacturing activity from the US to China have lifted metals, geopolitical risks and renewed uncertainty over monetary policy present clear challenges.
Last week, the U.S. and UK jointly imposed a ban on Russian supplies of aluminum, nickel, and copper to the London Metal Exchange, raising concerns about potential disruptions in global supply chains.
The significant role Russia plays as a major supplier of these metals has heightened worries about supply disruptions on a global scale.
In addition to the surge in copper prices, nickel prices also reached multi-month highs on Monday.
Market discussions regarding China's government's intentions to purchase nickel for state stockpiles have sparked concerns about tightened supply conditions. Furthermore, a bullish sentiment prevailing in base metals has provided additional support to the upward trend in prices, Reuters reported.
Meanwhile, the growing demand for Copper is often viewed as a barometer of economic vitality. This essential base metal plays a pivotal role in the energy transition ecosystem, serving as a key component in manufacturing electric vehicles, power grids, and wind turbines.
Earlier this month, Citi, a global investment bank, forecasted an upward trend in copper prices in the coming months. The bank anticipates prices to average $10,000 per metric ton by the year's end and to rise to $12,000 by 2026, based on its base-case scenario.
Looking ahead, the demand for copper is projected to experience significant growth as countries transition towards the green revolution. With many nations aiming to achieve carbon neutrality by 2050, analysts anticipate a substantial increase in the need for copper.
It is forecast that the quantity of copper required in the next 20 years may need to triple compared to the total amount produced throughout history. This projection underscores the remarkable scale of copper demand anticipated in the coming years.
Disclaimer: We advise investors to check with certified experts before making any investment decisions.
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