The rally in metal stocks continues. Firm global commodity prices and supportive macro signals are supporting the string upmove in metal stocks too. The Nifty Metal index is trading around 10,956, up 1.39% in morning trade with buying seen across zinc and copper counters. Hindustan Zinc share price jumped 2% intra-day while Hindustan Copper climbed over 8%to amid strong volumes.
The move is most likely driven by a combination of global interest rate expectations, currency trends, and improving demand visibility rather than company-specific developments.
Global cues, China demand and currency moves support metals
Expectations of further interest rate cuts by the US Federal Reserve have supported metal prices. Signs of easing in the US labour market have strengthened bets on a more accommodative policy stance, which typically benefits commodities priced in dollars.
China continues to play a central role in shaping base metals demand. Incremental policy support for infrastructure spending and renewable energy projects has helped improve consumption visibility. According to Jefferies, supply conditions across several base metals have tightened due to mining disruptions, elevated energy costs, and years of underinvestment. Jefferies said these constraints are becoming more visible as demand from electric vehicles and clean energy remains strong.
A softer US dollar has added to the positive tone. As markets factor in a gradual easing cycle in the US, the dollar index has eased from recent highs, offering support to commodities priced in dollars.
Silver rally lifts Hindustan Zinc; Copper strength backs Hindustan Copper
Silver has been one of the strongest performers this year, with prices doubling in 2025 to around $62 per troy ounce. Jefferies expects the global silver market to remain in deficit for the fifth consecutive year, driven by steady industrial demand and limited supply growth.
Hindustan Zinc stands out in this backdrop. Jefferies said the company is among the top five silver producers globally, with an annual capacity of about 800 tonnes, giving it direct exposure to higher silver prices. Silver contributed 38% of the company’s EBIT in FY25, and Jefferies expects this share to rise to 44% by FY27. The brokerage added that the full benefit of higher silver prices will begin to flow into earnings from FY27, as around 37% of second-half FY26 silver volumes were hedged at lower prices.
On valuation, Jefferies has set a base target price of Rs 660 for Hindustan Zinc, based on 10 times the September 2027 estimated EV/EBITDA. It has also outlined an upside scenario of Rs 740, assuming an 11 times EV/EBITDA multiple supported by higher commodity prices.
Copper-linked stocks have also seen strong buying interest, led by Hindustan Copper. The rally has come alongside higher global copper prices, a weaker rupee, and strong technical momentum, with the stock trading above key daily and weekly indicators.
Copper fundamentals remain supportive at the global level. Goldman Sachs, in its latest commodities outlook, has named copper its preferred industrial metal, citing its critical role in electrification, which accounts for nearly half of global demand. The bank pointed to growth drivers such as AI data centres, renewable energy, electric vehicles, and power grid infrastructure.
Goldman Sachs’ commodity outlook
Goldman Sachs also flagged supply-side challenges in copper. It noted that mine supply is highly concentrated geographically and faces constraints that limit the ability to ramp up output quickly. While copper prices have already risen sharply, the bank expects prices to consolidate and average around $11,400 per tonne in 2026, with pressure emerging in the second half of the year as the US draws down an estimated 1.5 million tonnes of stockpiled material.
Beyond copper, Goldman Sachs has reiterated a bullish stance on gold, calling it its preferred long commodity for 2026. The bank expects gold prices to rise to $4,900 per troy ounce by December 2026, supported by sustained central bank buying averaging about 70 tonnes a month, and scope for increased participation from private investors.
At the same time, Goldman Sachs remains cautious on aluminium, lithium, and iron ore. It expects a wave of new supply, largely from Chinese-backed overseas projects, to weigh on prices. Aluminium prices are forecast to fall to around $2,350 per tonne by end-2026, lithium to about $9,100 per tonne, and iron ore to roughly $88 per tonne, driven by fresh capacity additions from regions such as Indonesia, Africa, and Guinea.
The brokerage also pointed to the strategic importance of critical minerals, noting that China continues to dominate rare earth refining and maintains export controls on heavier rare earths used in defence and semiconductor manufacturing. Goldman Sachs added that metals such as copper and aluminium are in a phase where countries are trying to secure domestic supply chains through tariffs and subsidies, a trend that can influence pricing over the medium term.
Hindustan Zinc, Hind Copper lead metal sector rally
A quick look at the share price movement in key copper and silver plays in the share market indicates that Hindustan Copper is leading the gains. The big gains in silver also buoy Hindustan Zinc. Even steel stocks are rallying.