Shares of NMDC Ltd. dropped by up to 7%, reaching ₹215.13, after the Chinese government’s economic stimulus announcement failed to meet investor expectations. The National Development and Reform Commission of China discussed several policies aimed at boosting the economy, but the measures fell short of delivering the significant stimulus investors had hoped for.
The metal sector was particularly affected by this, with 14 out of 15 stocks on the Nifty Metal index trading in the red. The underwhelming stimulus is seen as insufficient to drive demand in the metal industry, which has a strong reliance on China’s economic health. Major brokerage Morgan Stanley noted that while the policies may stabilize China’s property market, they will struggle to lift prices and fully revive demand.
Until last Friday, the Nifty Metal index had gained over 8% since mid-September, riding on hopes of strong economic support from China. However, with China holding back on further stimulus, metal stocks, including NMDC, reacted negatively, leading to today’s selloff.
