Hindustan Copper shares jump 4%. What’s driving the rally?

Shares of Hindustan Copper surged more than 3% on Friday, reaching Rs 580.50 before easing. The rally coincided with a rise in global copper prices, buoyed by a declining US dollar, though the metal appeared poised to end a seven-week winning streak due to increasing inventories and narrowing price spreads. The London Metal Exchange's three-month copper benchmark climbed 0.53%, reaching $14,111.50 per tonne, while the Shanghai Futures Exchange's major copper contract rose 0.36% to 107,570 yuan per tonne. However, the LME copper price was still down around 0.30% for the week.

Indian copper producers are watching global price trends closely, as copper remains strong despite recent price moderation. Hindustan Copper's stock broke above the Rs 550 resistance level, accompanied by positive price action and rising trading volumes. The stock is above its key exponential moving averages and the relative strength index remains above 60, indicating growing bullish momentum.

Analyst Virat Jagad of Bonanza Portfolio gave Hindustan Copper a Buy rating, with a target price of Rs 655, implying a potential upside of about 14% from its current price of Rs 576.40.

Hindustan Copper shares have risen 8.87% in the past week and 16.97% over the past month. The stock has surged 10.21% this year and 140.19% over the past year. Over the longer term, Hindustan Copper has delivered impressive returns, with a 321% gain over three years and a 381% increase over five years. The stock's 52-week high is Rs 759.20, while its low is Rs 226.25, meaning it is currently around 24% below its five-year peak.