Metal companies' hot run comes to an end as West Asia cools off

The Nifty Metal index fell 3.2% on Tuesday, outpacing the 1.2% decline in the Nifty, as easing West Asia tensions triggered unwinding of risk premiums and profit-booking in the sector. Vedanta dropped 7.9%, while National Aluminium Company, Hindustan Zinc, and Jindal Steel declined between 4-6%, dragged by falling aluminium, steel, copper, and zinc prices on the London Metal Exchange. Despite the correction, the Nifty Metal index remains up 13% year-to-date, though analysts are advising a wait-and-watch approach citing a firm dollar index and concerns over US Federal Reserve rate hikes.