Market Movers: China concerns spark selloff in metals, Tata Motors

Shares of metal companies were among the biggest losers on the day. Concerns surrounding slowing economic growth in China, the largest consumer of metals, arose in the light of media reports that the Chinese Cabinet was in favour of cutting interest rates.

Normally, such an accommodative policy stance should have sent metal stocks to the moon, but the sudden shift in gear by the Chinese government has led to concerns that the world’s second largest economy might be slowing after the post-Covid boom. The Nifty Metal index, as a result, fell over 2 per cent in the session.

Tata Motors’ problems grow

Well, if the management of thought that chip shortage is the worst of their problems, there is news. Shares of the company tanked nearly 3.5 per cent during the session as investors are now concerned that one of the biggest markets for its arm, Jaguar Land Rover, may soon be entering a tricky economic wicket. The Chinese economic momentum has slowed in recent months and talks of interest rate cuts have pushed the anxiety button of investors, who now believe a deeper slowdown is under way. At a time when JLR has already warned that its ability to produce cars is being severely hamstrung by the lack of semiconductors in the world, a slowing Chinese economy will act as a double blow for the luxury car maker.

Rising and shining

While investors are fretting over the global scenario, one stock is least bothered. Rakesh Jhunjhunwala-backed Nazara Technologies had a stellar show despite weak market conditions.

The company’s stock jumped over 5.5 per cent on Thursday, as investors turned optimistic of another quarter of strong earnings from technology companies ahead of ’ June quarter earnings announcement later today. The stock has been one of the biggest gainers of 2021 so far, and continued earnings growth could make its momentum unstoppable in the near term.