India’s stock market kicked off the week on a stormy note, with metal stocks taking the biggest hit. The Nifty Metal Index crashed over 7.5% on Monday, due to the deepening fears over a global economic slowdown as the US-China trade war enters a dangerous new phase.
What triggered the freefall?
It’s the latest tariff battle. The US announced a steep 26% tariff on Indian imports, and China quickly retaliated with 34% duties on American goods. But that’s not all. Beijing also slapped export restrictions on key rare earth metals, a move aimed at hurting American tech, defence, and electronics industries.
This tit-for-tat between the two superpowers has sent shockwaves across global markets. Metal stocks, already sensitive to international demand and pricing, were among the worst hit.
Metal stocks bleed as trade tensions escalate
The Nifty Metal Index slumped over 7% to 7,810.45 on Monday, with all 15 constituent stocks trading in the red. The sharp fall came amid growing global trade tensions and recession fears in the US. Lloyds Metals and Energy led the slide with a nearly 12% drop, followed by Tata Steel falling 10%, and Hindustan Copper down 9%. Other metal majors like Vedanta, National Aluminium, SAIL, and Hindustan Zinc also lost around 8%, triggering panic among investors on Dalal Street.
With global uncertainty looming large, foreign investors are pulling money out of emerging markets like India. While Indian metal companies such as JSW Steel, Vedanta, NALCO, and Hindustan Zinc are banking on strong local demand and global diversification for long-term growth, the short-term outlook remains shaky.
Dalal Street: Sensex, Nifty in deep red
Dalal Street is witnessing a massive selloff on Monday, with benchmark indices trading deep in the red in the intraday trading. As of the latest update, the Sensex is down 2,869 points (3.81%) at 72,495.62, while the Nifty has slipped 960 points (4.19%) to 21,944.30.
Earlier in the day, the Sensex had plunged over 3,000 points to hit a low of 71,425, and the Nifty briefly broke below 21,750.
The market meltdown is broad-based. All sectoral indices are bleeding, with media, realty, auto, IT, and metal sectors down between 5% and 7%. Broader indices are also under pressure – the BSE Midcap and Smallcap indices have lost over 5% each. The sharp fall comes amid global trade tensions, fears of a US recession, and sustained foreign investor outflows, sparking concerns of a prolonged market downturn.