The shares of metal and real estate companies tumbled on August 22, pushing the two sectoral indices into the red sharply. This comes ahead of US Federal Reserve Chair Jerome Powell's speech at the annual Jackson Hole symposium.
The Nifty Metal index declined over 0.7 percent to stand at 9,424, while the Nifty Realty index fell more than 0.5 percent to hover around 912, as seen at 10.20 am.
The American central bank is holding its annual symposium from August 21 to August 23 in Jackson Hole, Wyoming. Fed Chair Jerome Powell is scheduled to speak on the economic outlook and central bank's policy framework on Friday.
US President Donald Trump has criticised Powell multiple times for not cutting rates. In a Truth Social post, Trump referred to Powell as "Jerome ‘Too Late’ Powell" and accused him of not acting promptly to reduce interest rates. He also stated that Powell is "hurting" the housing industry "very badly" and reiterated his call for a cut in key interest rates.
Most investors now expect a 25-basis-point Fed rate cut next month. A rate cut in the US could reduce borrowing costs for foreign investors, encouraging them to invest in higher growth markets in India. This boosts real estate and metal stocks. Additionally, investors expect the RBI to follow Fed in the pursuit of a rate cut, if any. This too can further impact the stocks.
JSW Steel and Jindal Steel & Power shares dropped over 1.3 percent each, while Steel Authority of India (SAIL) and Hindustan Zinc shares fell more than 1 percent each.
Adani Enterprises, Hindustan Copper, Tata Steel and National Aluminium Company (NALCO) shares fell nearly 1 percent each, while Hindalco, Vedanta and Welspun Corp shares were down with marginal losses.
Raymond shares were the top loser on the realty index, dropping nearly 2 percent to trade at Rs 622 apiece. Oberoi Realty, Macrotech Developers (Lodha), DLF and Anant Raj shares fell nearly 1 percent each, while Phoenix Mills, Brigade Enterprises and Godrej Properties shares were down marginally in the red.
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