Metal Stocks Outlook for the week – 12 to 16.06.2017

Metal Stocks Outlook for the week – 12 to 16.06.2017

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Metal Stocks Outlook for the week – 12 to 16.06.2017 )

After stellar gains this week, traders may book some profits in the shares of metal and mining companies next week ahead, but the underlying sentiment remains positive. Investors will closely track the movement of the dollar because strength in the currency may exert pressure on prices of base metals globally. The US Federal Reserve is scheduled to hold its monetary policy meeting next week. The central bank is widely expected to raise interest rates, which will see the dollar gaining an edge over other currencies. This could weigh on prices of metals globally because these prices typically have an inverse relation with the greenback. After snapping a three-session gaining streak last week, the Nifty Metal index had ended with 2.5% losses, but resumed its uptrend this week, closing 2.5% higher. The index outperformed the Nifty 50, which ended only 0.1% higher on a weekly basis. On fundamental parameters, upbeat on the sector. Stocks of steel and aluminium companies are seen positive due to an improving demand outlook, likely scarcity in supply, and support to prices from anti-dumping duties. The government's thrust on housing, infrastructure, and capital expenditure and preference to domestic steel producers for procurement in government projects is also seen as beneficial for companies in this segment

Source : Cogencis Information Services Ltd.