 "Metal shares decline after China coal, iron ore imports drop")
Shares of metal companies are trading lower up to 5% on the NSE on the back of swift retreat in Chinese demand for iron ore and coal which in turn led the global iron ore prices to touch near five-year lows and local coal prices to their weakest in six years.
Chinese imports of iron ore and coal dropped sharply in August from the month before amid slackening demand and abundant supply, with rapidly falling prices failing to stoke appetite in the world's top buyer of those commodities.
Tata Steel, Sesa Sterlite, Jindal Steel, Hindalco, Jindal Steel, JSW Steel, NMDC and Coal India are down 1-5% on the National Stock Exchange(NSE).
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Meanwhile, Hindalco which gained in the recent past as global rival Alcoa Inc's earnings beat forecasts, propelled by higher aluminium prices has dropped nearly 5% in today’s trade. Hindalco expects similar earnings performance from its overseas subsidiary Novelis Inc, which is the world's largest producer of rolled aluminium products.
At 2.00 PM, CNX Metal index is down about 3% or 89 points at 2,778 compared to 0.9% or 68 points decline in benchmark CNX Nifty at 7,892 mark.
Coal imports by China, which accounts for about a quarter of global trade in the material, plummeted for the second month to 18.86 million tonnes in August, according to official data from the General Administration of Customs of China. That was the lowest since September 2012.
In addition, August iron ore imports declined just over 9% from the previous month to hit a two-month low of 74.88 million tonnes, as weakening steel demand has clashed with a flood of supply.