Tata Steel, JSW Steel, Jindal Steel, NMDC shares trade higher today; here's why

Metal stocks such as Hindalco Ltd, Tata Steel Ltd, JSW Steel Ltd, Jindal Steel and Power, NMDC and Jindal Stainless pushed the market higher today after global brokerage Jefferies said it maintains a constructive view on the Indian metals sector. This led to positive sentiment around metal stocks with the BSE metal index rising for the third straight session. The BSE metal index surged 1,300 points in the last three sessions. On similar lines, Nifty IT index climbed for the fifth straight session today. The index has gained 823 points in five sessions as stock market showed signs of recovery and more clarity on the Trump tariffs emerged.

In the current session, the BSE metal index was the top gainer among 19 indices, rising 404 points. Similarly, Nifty metal index gained 116 points to 9042 today. The index crossed the 9,000 mark today for the first time since December 20 last year when it hit an intraday high of 9,051.20

Jefferies said any safeguard duty on steel imports to India could push steel prices higher, supporting margins and valuations of Tata Steel, JSW Steel and Hindalco Industries. This proved to be a sentiment booster for other metal sector stocks. The brokerage raised target price for Tata Steel (Buy) to Rs 180 from Rs 165 earlier. The target price for JSW Steel was also revised to Rs 920 from Rs 850 earlier, but Jefferies continued to maintain a 'Hold' on this stock. The brokerage maintained a target price of Rs 800 on Hindalco.

The Indian steel industry has been calling for safeguard duty on flat steel. Brokerage Emkay Global has also outlined the need for protectionist moves on select sectors such as steel.

Meanwhile, in the current session, Hindalco Industries shares surged 2.54% to Rs 709 on Monday against the previous close of Rs 691.40 on BSE. Market cap of the aluminium maker stood at Rs 1.56 lakh crore.

Tata Steel shares gained 1.74% to Rs 154.20 on BSE. Market cap of the iron and steel maker stood at Rs 1.90 lakh crore.

Jindal Steel and Power stock climbed 2.76% to Rs 934.15 against the previous close of Rs 909. Market cap of the firm stood at Rs 93,338 crore. Shares of JSW Steel rose 2.11% to Rs 1,032.50 against the previous close of Rs 1,011.15 on BSE.

Metal stock NMDC gained 2% to Rs 68.48 today with a market cap of Rs 59,212 crore. Similarly, shares of Jindal Stainless climbed 1.37% to Rs 664 on BSE.

The metal sector stocks extended gains this week after China announced that it would restructure its steel industry to reduce its total steel production. With reduced steel output from China, there will be less cheap Chinese steel entering the Indian market. This augurs well for Indian steel companies as it will enable them to sell steel at better prices, without much competition from cheap imports. This led to a surge in the metal stocks last week.

Meanwhile, Sensex gained 163 points to 74,496 and Nifty surged 28 pts to 22,581 in the afternoon session today led by a rally in the metal stocks.