Metal stocks including fell nearly 5%, while Vedanta and National Aluminium Company () declined close to 4% each. dropped around 3% as metal prices weakened following hawkish comments from US Federal Reserve Chair Kevin Warsh, which strengthened expectations that further interest rate hikes may be required.
The index also came under significant selling pressure, declining more than 2% in intraday trade amid a broader market sell-off.
Hindustan Zinc fell as much as 4.7% to its day’s low of ₹592.05. NALCO declined 3.8% to ₹369, while Vedanta dropped 3.7% to ₹276.50. Hindalco shed 3% to ₹1,005.30. Hind Copper also declined 2.5% to ₹520.20 during the session.
Gold, Silver Prices Today
slipped to its lowest level in nearly two weeks on Monday after Warsh’s comments raised concerns that the US Federal Reserve may need to raise interest rates to bring inflation under control. Escalating tensions in the Middle East further added to concerns about inflation.
Spot gold was down 0.3% at $4,439.31 per ounce at 0643 GMT, after touching its lowest level since August 19 earlier in the session. Gold prices had already declined more than 3% on Friday.
US gold futures fell 0.9% to $4,489.50, while spot silver declined 0.5% to $66.68.
The weakness was also visible in domestic commodity markets. Gold and prices fell by up to 2% in morning trade on the Multi Commodity Exchange (MCX) on Monday, August 31, amid heavy profit-taking and weak global cues.
MCX gold October futures declined by more than ₹2,600, or nearly 2%, to ₹1,53,640 per 10 grams. MCX silver September contracts plunged by over ₹4,200, or almost 2%, to ₹2,32,501 per kg in early trade.
The decline in precious metals came amid aggressive profit-taking, weak global market cues, rising US bond yields and escalating tensions between the US and Iran. The conflict has pushed energy prices higher and raised concerns about another flare-up in inflation.
On Friday, Warsh said the US central bank would “have work to do” if policymakers did not gain the confidence needed to ensure inflation was heading towards the 2% target.
Markets currently see a 57% chance of a rate hike at the Federal Reserve’s next policy meeting in September, compared with 36% before Warsh’s comments, according to the CME FedWatch tool.
Inflation data also contributed to the concerns. US Personal Consumption Expenditure (PCE) rose 3.7% year-on-year in July, indicating that inflation remained above the Federal Reserve’s 2% target for the 65th consecutive month.
Meanwhile, the US 10-year bond yield climbed to 4.74%, extending its rise for a fourth consecutive session. The 30-year bond yield stood at 5.22%, rising for the third straight session.
Jefferies’ View on Metal Stocks
, copper and other industrial metals also declined as expectations of higher-for-longer US interest rates outweighed supply concerns that had earlier supported a monthly rise in metal prices during August.
The sharp decline in may also have been driven by profit booking. The Nifty Metal index had surged more than 6% so far in August, outperforming most major sectoral indices amid concerns surrounding supply.
In its latest note, Jefferies said the recent divergence in metal prices has favourable implications for Hindustan Zinc’s earnings, while weighing on Hindalco.
According to the international brokerage, spot zinc prices have risen 15% over their Q1 averages, while silver has recovered 23% from its July lows. Jefferies remains constructive on precious metals, arguing that the impact of widening fiscal deficits, elevated debt levels and ongoing currency debasement remains underappreciated.
The brokerage raised its silver price assumptions to $60–63, which remains 8–14% below the spot price, suggesting there could be further upside to earnings if current spot prices are sustained.
In comparison, aluminium prices are 10% below their June-quarter average, Jefferies noted. Supply disruptions in the Middle East resulted in a 4% year-on-year decline in global production during the first half of 2026. However, a 2% increase in Chinese output largely offset this decline, leaving global production broadly stable.
Jefferies raised its FY27–28 aluminium price assumptions to $3,300–3,325, which remains 3–4% above the spot price.
The brokerage remains bullish on Hindustan Zinc and raised its target price, citing its preference for zinc and silver over aluminium. Jefferies hiked its target price for Hindustan Zinc shares to ₹750 apiece while maintaining its ‘Buy’ rating.
For Hindalco Industries, Jefferies raised the target price to ₹1,140 per share but retained its ‘Hold’ recommendation. The international brokerage continues to prefer Hindustan Zinc shares over those of Hindalco Industries.
Disclaimer: The views and recommendations made above are those of individual analysts or broking companies, and not of Mint. We advise investors to check with certified experts before making any investment decisions.