Vedanta, NALCO, NMDC shares tank 6% on spike in US dollar; Metal index slumps 3%

The Dollar Index surged over 1 percent, reaching levels around 110, simultaneously putting pressure on the Indian rupee, which opened at a record low today in response. A rise in the dollar index generally spells trouble for metal companies in non-dollar denominated countries, including India. This uptick in the greenback can erode the export competitiveness of Indian metal manufacturers, drive up input costs, and intensify financial burden, particularly for those carrying dollar-denominated debt. Moreover, the imposition of the first set of tariffs by President Trump on three major trade partners—China, Canada, and Mexico—has fueled concerns of a full-blown trade war between key global economies. Trump signed off on 25 percent tariffs on imports from Canada and Mexico, while Chinese imports were subjected to a 10 percent levy. Given that China is the world's largest importer of metals, any trade tensions involving the country could significantly affect global demand for metals, further complicating the outlook for Indian metal companies. Disclaimer: The views and investment tips expressed by investment experts on Moneycontrol.com are their own and not those of the website or its management. Moneycontrol.com advises users to check with certified experts before taking any investment decisions.