Metal stocks shine: SAIL, JSW Steel, Hind Copper drive Nifty Metal 2% higher

Metal stocks rise today: The Nifty Metal index surged close to 2% on Wednesday, November 26, extending gains to the second straight session, mirroring optimism on Dalal Street. The rally was fuelled by supportive global cues, with investors increasing bets on a potential US Federal Reserve interest rate cut in December, which lifted metals and cyclicals across global markets.

All major sectoral indices on the NSE opened in the green, indicating broad-based buying across sectors. The Nifty Metal index emerged as one of the top-performing sectoral indices in early trade, second only to the Nifty PSU Bank index.

The benchmark metal index rose as much as 1.85%, touching an intraday high of 10,260.45. It is now barely 5% away from its all-time high of 10,837.45, recorded in October last year. The index had previously hit its 52-week low of 7,690.20 in April 2025, marking a notable rebound since then.

In terms of performance, Nifty Metal has gained 15% over the past year, 10% in the last six months, and 10.5% in the past three months. Over five years, the index has delivered multibagger returns, soaring 250%. However, the month of November has been weak, with the index shedding 3.4%, placing it on track for its biggest monthly fall in seven months.

It had risen 5.7% in October, 9.6% in September, but declined 1.4% in August, and 2.6% in July. Prior to November, its worst monthly performance this year was a 5.6% drop in April.

SAIL, JSW Steel, Hind Copper Lead Gainers

All Nifty Metal constituents were trading in the green during today’s session. SAIL led the surge, rising 4.5% to ₹138.30, followed by JSW Steel, which gained 3.4% to ₹1,149.35. Hind Copper rose nearly 3%, while Ratnamani Metals climbed around 2.5%.

Other heavyweights such as JSPL, Tata Steel, NALCO, NMDC, APL Apollo Tubes, Vedanta, Hindustan Zinc, and Hindalco Industries also advanced more than 1% each in intraday trade.

Why Did the Index Fall in November?

The recent weakness in November—where the index fell 4%—was triggered by the government extending exemptions from mandatory quality control orders for certain steel and stainless-steel grades. This move could allow additional imports into the country, putting pressure on domestic producers and potentially weighing on prices.

During the early November decline, all constituents except Adani Enterprises traded lower, with Hindalco recording the sharpest fall.

Adding to the pressure has been the strength in the U.S. Dollar Index, which has held above the 100 mark. A stronger dollar makes dollar-denominated commodities like metals more expensive for global buyers, which often impacts demand and sentiment.

Metal Sector Outlook Ahead

Axis Securities said the metal and mining sector posted a strong performance in Q2 despite a volatile macro environment. However, concerns around the steel sector linger.

The steel sector may see weaker pricing in Q3FY26, as steel spreads could fall 7% QoQ if hot-rolled coil (HRC) prices do not improve, said the brokerage. So far, spot HRC prices are down 4% QoQ.

In Q2FY26, NMDC iron ore prices fell 5% YoY and 4% QoQ, while coking coal costs rose 3% QoQ, which will pressure margins this quarter because raw materials are consumed with a one-quarter lag. Domestic HRC prices, averaging ₹48,722/t, are now at a 12% discount to landed Chinese prices due to higher steel supply.

Axis Securities added that raw material trends are mixed. Coking coal averaged $189/t in Q2FY26 (down 23% YoY) but edged up 2% QoQ, while iron ore averaged $100/t, up 5% QoQ and flat YoY. Spot prices currently stand at $199/t for coking coal and $101/t for iron ore.

The brokerage said investors should watch for more China stimulus, India’s decision on extending the 12% safeguard duty on steel, the US imposing 50% tariffs on steel imports, and any further steel production cuts in China.

Axis Securities has identified APL Apollo Tubes and Hindalco as its preferred metal sector picks following the Q2 earnings season. The brokerage has set a target price of ₹880 for Hindalco, indicating a potential upside of about 10%. For APL Apollo Tubes, Axis Securities has assigned a target of ₹2,100, implying an upside potential of over 21%.

Meanwhile, Kotak Institutional Equities trimmed aggregate EBITDA estimates for the stocks in its coverage by 4%/1%/1% for FY2026/27/28E, factoring in ongoing sluggish market dynamics.

"Notification of safeguard duty and subsequent domestic steel price hikes are the key catalysts in the near term. We continue to see better risk-reward in non-integrated steel producers — JSPL and JSTL. Maintain SELL on SAIL and TATA," the brokerage added.

Disclaimer: The views and recommendations made above are those of individual analysts or broking companies, and not of Mint. We advise investors to check with certified experts before making any investment decisions.