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Informist, Saturday, May. 2, 2025

MUMBAI – Metal companies are seen moving in a range amid uncertainty around the impact of US reciprocal tariffs on global economic growth, which analysts said has put capital expenditure and demand for metals at risk. There is still some hope of a trade deal between the US and China, which is likely to be positive for the metal industry.

China's Commerce Ministry Friday said they are considering to hold talks after seniors US officials reached out to China. However, China also said it will only engage in negotiations with the US if they cancel the tariffs announced against Chinese goods, the New York Times reported.

Reciprocal tariffs in April and additional tariff by the US on China are expected hurt economic growth and bring down global demand for metals. Recent data from China showed manufacturing in the country has slowed due to tariffs by the US. The Caixin manufacturing purchasing managers index fell to 50.4 in April from 51.2 in March, Dow Jones reported.

Brokerage Nomura pointed out that PMI has declined in April across Asian countries including China, Indonesia, Malaysia, South Korea, among others. "...combination of escalation and de-escalation in tariff policy is likely to breed uncertainty and lead to a slowdown in capex," it said in a note Friday.

Amid this backdrop of global growth, Indian metal companies are seen better placed on expectation of better demand for metals in India. Analysts also prefer Indian metal companies as product prices are likely to improve after the government announced safeguard duty against cheap imports recently. This is likely to help protect downside of metal stocks, but any sharp rise in stocks would depend on improvement in outlook for global economic growth.

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Following are the resistance and support levels for the stocks for next week as per calculations by Informist based on their prices on the National Stock Exchange:

End

Reported by Anshul Choudhary

Edited by Akul Nishant Akhoury

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