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Falling aluminium prices and concerns over rising Chinese supply pressured metal stocks on Tuesday, with shares of Vedanta, Hindalco Industries, National Aluminium Company (NALCO), Hindustan Zinc and major steelmakers trading lower.
{alcircleadd}According to a commodity note by Kotak, aluminium prices have come under pressure due to increasing Chinese exports and domestic aluminium production in China remaining close to record levels. Despite the recent decline, the brokerage noted that global aluminium output outside China remained subdued in May, keeping market fundamentals relatively tight and supporting the metal's medium-term outlook.
Among aluminium-related stocks, NALCO fell 4.4 per cent to INR 361.50, while Hindalco declined 2.7 per cent to INR 986.85. Hindustan Zinc also slipped 2.8 per cent to INR 555.35 during morning trade.
Vedanta emerged as the worst-performing metal stock of the day, plunging 8.85 per cent to an intraday low of INR 278.80 on the BSE. The decline followed reports that promoter group entity Twin Star Holdings was considering the sale of up to a 1.7 per cent stake in the company through block deals. The proposed transaction, reportedly priced at a floor price of INR 291 per share, could raise approximately INR 1,890 crore for the promoter group.
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The weakness extended across the broader metals sector. Steelmakers Tata Steel, Steel Authority of India (SAIL) and Jindal Steel & Power lost between 1 per cent and 3 per cent, while JSW Steel and Jindal Stainless also traded in negative territory. Brokerage firm Nomura said global steel prices remained largely range-bound last week, while India's steel market witnessed a mild correction in flat steel prices and a sharper decline in long products.
The combined impact of softer aluminium prices, weakness in steel markets and company-specific developments at Vedanta contributed to broad-based selling across metal counters.
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