Steel Stocks Outlook for the week (25-29.06.2012)

[rupeedesk]

Steel Stocks Outlook for the week (25-29.06.2012)

Stocks of major steel companies are seen trading in the red next week due to weak demand in the domestic as well as overseas market. Worries over economic growth in developed economies such as Eurozone and the US, along with concern over China's consumption for the alloy is expected to keep the sentiment subdued in the sector in coming sessions.

In the US, initial jobless claims data in the week ended Jun 16 released Thursday were higher-than-expected, which have raised worries over the economic recovery of the world's leading steel consuming country. Continued concern over the Eurozone debt issues is also weighing on the steel sector. In the domestic market, demand from the auto and construction sector is weak due to onset of monsoon and also because of worries over economic growth. Weakness in demand has pushed up inventories of domestic steel companies, which is also adding downward pressure in stocks of major steel companies.