Nifty Metal spikes over 1.5% on US Fed rate cut hopes; Hindustan Zinc hits record high
Hindustan Zinc jumped over 18.65% to hit a new high of ₹541 apiece, and Hindustan Copper and Vedanta also gained over 4% in today's intraday trade. Other stocks such as Steel Authority of India, Jindal Stainless, JSW Steel, NALCO, Hindalco Industries, NMDC, Jindal Steel & Power, and Ratnamani Metals & Tubes are currently trading with gains between 0.5% and 2%. Recent U.S.
data indicates a cooling labor market, with a notable rise in initial claims for state unemployment benefits. This, coupled with last week's weak payroll report, strengthens investor expectations of imminent interest rate cuts by the Federal Reserve. Also Read: Akshaya Tritiya: Religare Broking lists 6 key reasons to buy gold in 2024 The anticipation of rate cuts has buoyed hopes for economic growth and metal demand while potentially softening the dollar.
A weaker dollar typically makes dollar-denominated metals more affordable for holders of other currencies. Furthermore, several central banks are signaling their readiness to lower interest rates. Bank of England Governor Andrew Bailey suggested possible rate cuts as early as next month, hinting at further reductions ahead.
On the other hand, Sweden's central bank cut its key interest rate on Wednesday for the first time in eight years. Also Read: Market Meltdown: Indian stocks lag behind global peers in May Meanwhile, Britain's economy grew by the most in nearly three years in the first quarter of 2024, ending the shallow recession it entered in the second half of last year. Anticipated rate cuts and enhanced growth in advanced economies are encouraging indicators for metal prices.
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