Hind Copper, SAIL, Tata Steel Share Price: Why Metal Stocks Are Shining In A Subdued Market And What Investors Should Do

Hindustan Copper, SAIL, Tata Steel Share Price: Metal stocks outperformed the broader market in early trade on December 29, led by a sharp rally in Hindustan Copper. The copper-mining firm’s stock surged as much as 15 per cent to hit a fresh 52-week high of Rs 545.95 per share on the NSE, emerging as the top gainer in the Nifty Metal index.

Shares of steel major Steel Authority of India (SAIL) also climbed up to 5 per cent to an intraday high of Rs 138.80 apiece. Tata Steel advanced as much as 3 per cent, touching a day’s high of Rs 174.13 per share.

The broader metal pack traded firmly as well. Vedanta rose about 2.50 per cent, while Jindal Steel gained nearly 2.44 per cent. Welspun Corp was up around 2.20 per cent, APL Apollo Tubes added about 1.57 per cent, and JSW Steel traded higher by roughly 1.10 per cent during the session.

Nifty Metal Index Rallies 5% In A Week

The Nifty Metal index, which reflects the behaviour and performance of 15 most valuable and actively traded stocks from the sector, surged up to 1.65 per cent in an otherwise weak market today.

Meanwhile, the broader market remained subdued, with benchmark indices Sensex and Nifty 50 trading in the red, lower by around 0.30 per cent, as of the time of writing. Most major sectoral indices too traded in the negative territory.

While the benchmark indices are struggling to hold on to their October and November rallies, the Nifty Metal index is scaling new highs each day. Over the past consecutive seven sessions, the metal index has been closing higher, and over these days, it rallied nearly 5 per cent. In 2025 so far, it has rallied 27 per cent.  

Why Metal Stocks Are Rising

The rally in metal stocks comes amid a combination of supportive global and domestic factors. Vaqarjaved Khan, CFA, senior fundamental analyst at Angel One, said base metals, particularly copper, have rallied sharply amid tight supply conditions and resilient demand linked to electric vehicles, infrastructure and industrial activity. He also attributed the rally to incremental demand from China, driven by renewed growth in infrastructure and industrial sectors.

Echoing similar views, Pravesh Gour, senior technical analyst at Swastika Investmart, said multiple factors are working in tandem to support metal prices and related equities. He said that global base metals such as copper and aluminium have seen renewed interest on expectations of supply tightness and steady demand, especially from energy transition themes such as renewable power, EVs and grid expansion.

China-linked optimism has also lifted sentiment. Gour said hopes of incremental stimulus and higher infrastructure spending in China, the world’s largest consumer of metals, have improved the outlook for global metal markets. A softer US dollar has further aided the rally, as it makes commodities cheaper for non-US buyers and supports realisations for producers.

At the domestic level, Gour highlighted improved inventory discipline, cost control and deleveraging by metal companies, which has enhanced earnings visibility compared to previous cycles. He added that part of the recent rise also reflects a catch-up rally after prolonged underperformance, aided by short covering.

Rise In Copper Prices

Copper prices have climbed sharply amid uncertainty over possible US import tariffs, which has prompted a diversion of metal from LME and Asian warehouses to Comex-approved facilities in the US, tightening supply elsewhere. Kaynat Chainwala, AVP – Commodity Research at Kotak Securities, said the move has distorted trade flows and lifted prices despite limited improvement in end-user demand.

Supply-side stress has intensified after years of underinvestment and recent disruptions at major mines, JP Morgan noted, leaving the market vulnerable to shortages. Chainwala added that concentrate markets are extremely tight, with treatment charges near zero. On the demand front, Justin Khoo, senior market analyst – APAC at VT Market, said electrification, EVs, AI infrastructure and data centres continue to drive copper consumption, supporting prices.

What Investors Should Do

Khan cautioned that metal stocks are now trading at elevated valuations, making the risk-reward less favourable at current levels. He advised existing investors to consider booking partial profits and suggested avoiding fresh positions for now.

Khan said, “At current levels, valuations have gone steep and elevated for the Metals Index. Metals are highly cyclical but current valuations especially in base metal companies caution warrant. However, a dip can be used for fresh entry position. Hindustan copper prices have rallied significantly mainly on account of rising global copper prices, weaker rupee and stability in China. For existing investors, booking out of partial profits can be done and for new investors current levels looks elevated hence can wait for correction to build fresh position.”

Gour also struck a cautious note, saying that while near-term momentum remains supportive, fresh entries should be approached carefully as metal stocks are inherently cyclical and sensitive to changes in global growth expectations. He pointed out that valuations in select names have expanded rapidly, leaving limited margin of safety in the short term.

“For investors with a medium-to-long-term view, staggered buying on corrections may be a better strategy rather than chasing sharp rallies,” Gour said. He added that conservative investors may prefer exposure through well-diversified large metal players with strong balance sheets rather than aggressive bets on high-beta stocks.