Tata Steel, Hindustan Copper, HZL: Metal stocks crack on Thursday, January 8; NIFTY METAL index tumbles 3.5%. Key points to know

The NIFTY METAL index cracked as much as 3.46% to hit the low of 11,124.70 levels against the previous closing level of 11,524.

All the 15 constituents of the index were trading in negative territory, with Hindustan Zinc (HZL) and Hindustan Copper (down over 6%) leading the fall.

The NIFTY METAL Index is designed to reflect the behaviour and performance of the metals sector, including mining in India.

Profit-booking

A slide in metal stocks could be partially attributed to profit-booking in recent outperforming scrips such as Hindustan Copper and Hindustan Zinc (HZL), NALCO, Vedanta, and HINDALCO, among others, given the sharp rally in industrial metals such as copper and silver.

Data show that Hindustan Copper shares have jumped 93% in the past six months, while those of Hindustan Zinc have gained 37%. Vedanta, HZL's parent company, has advanced over 32% during the period, while NALCO has jumped 78%. Hindalco Industries shares have gained over 33% during the window.

Among steel stocks, SAIL has risen 9% during the 6-month period, while JSW Steel has rallied 12%.

Tata Steel shares have also advanced over 12% during the window.

Copper and silver prices skyrocket

Copper prices are rallying, supported by rising demand from technology and energy transition sectors and tariff-related uncertainties. Market experts attribute the current surge to supply challenges in major producing regions such as Chile and Indonesia, where environmental disruptions and operational issues have contributed to a tighter global market.

Goldman Sachs Research recently said copper prices will decline somewhat in 2026 from their recent record highs, even as demand from the grid and power infrastructure gradually drives prices higher in the longer term.

In 2026, it expects the LME copper price to remain in a range of $10,000-$11,000, as strong global demand growth from the grid and power infrastructure, backed by investment in strategic sectors such as AI and defence, keeps prices from falling below $10,000.

The investment bank forecasts the LME copper price to average $10,710 in the first half of 2026 and to reach $15,000 per tonne by 2035 in the longer term.

Silver prices also experienced a historic surge in 2025, rising nearly 161% year-to-date (YTD). The price of the silver metals has gained momentum amid expectations of higher industrial demand and supply shortage fears.

Experts note that silver may continue to get the dual advantage of being a precious and industrial metal. The strong demand outlook and supply worries are supporting fundamentals for the bullish trend.

Steel companies' 2026 outlook

Experts note that CY2025 was a challenging year for domestic steel players, with earnings pressured by steel price corrections amid global headwinds and significant capacity addition over the past 3-4 quarters, leading to supply overhang.

While India’s finished steel imports declined due to safeguard duty, the rising trade barriers globally would continue to pose diversion risks, opines Sumit Jhunjhunwala, Vice President, Sector Head, Corporate Sector Ratings, ICRA Ltd.

In this backdrop, Jhunjhunwala adds that continuation of safeguard duties remains critical to shield domestic prices.

Looking ahead, resilient domestic demand, gradual absorption of new capacities, and a meaningful recovery in buying activity in the Chinese property market remains the key theme that would drive domestic steel prices in CY2026.

ICRA has a stable outlook on the sector with expectations of industry OPBDITA/MT remaining above 100$/MT in the near term.

Metals remain a cyclical opportunity

Gaurav Didwania, Partner & Fund Manager at Qode Advisors, in a recent interview with Upstox News, had said that metals remain a classic cyclical opportunity, powerful on the way up and painful on the way down.

"India’s own capex cycle does support demand, and the global clean energy transition is structurally positive for copper and aluminium. But the sector will always remain sensitive to China, trade policy, and commodity cycles," Didwania had said.

It’s an investable space, but not one to marry. Position sizing and timing matter as much as stock selection.