Why Hindustan Zinc Shares Tanked 5% After Decline In Global Silver Prices

The shares of Hindustan Zinc, a Vedanta Group enterprise, decline 5% in Tuesday's trade, June 23, plummeting to an intraday low of Rs 544 apiece, after a sharp fall in global silver prices impacted investor sentiment.

Meanwhile, spot silver prices tanked 5% to $61.90 per ounce, hitting their lowest level since June 11.

In the domestic market, near-month silver futures plummeted by ₹2.25 lakh per kilogram. Silver prices were last seen around these levels in late March.

After today's fall, silver's month-to-date losses broadened to 15%, eclipsing all the gains recorded in May. From its record high of Rs 4,57,328 per kg, the metal has now fallen by roughly Rs 2.30 lakh, or about 50%.

Hindustan Zinc's shares are particularly sensitive to fluctuations in silver prices, given the metal's significant contribution to the company's revenue and profitability. Precious metals have witnessed heightened volatility since the outbreak of the conflict in the Middle East, as rising energy prices strengthened expectations of higher interest rates.

Spot silver prices slumped 5% to $61.90 per ounce, hitting their lowest level since June 11. In the domestic market, near-month silver futures plunged by Rs 2.25 lakh per kilogram. Silver prices were last seen around these levels in late March.

With today's decline, silver's month-to-date losses widened to 15%, erasing all the gains recorded in May. From its record high of Rs 4,57,328 per kg, the metal has now fallen by nearly Rs 2.30 lakh, or about 50%.

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Hindustan Zinc's shares are particularly sensitive to fluctuations in silver prices, given the metal's significant contribution to the company's revenue and profitability. Precious metals have witnessed heightened volatility since the outbreak of the conflict in the Middle East, as rising energy prices strengthened expectations of higher interest rates.

US Federal Reserve officials, in their recent meeting, signalled that a rate hike in 2026 may be warranted if inflationary pressures persist, particularly those linked to elevated energy costs.

Although crude oil prices have retreated to pre-conflict levels amid hopes of a long-term peace deal in West Asia, concerns remain that the inflationary impact of recent disruptions could keep rate-hike expectations alive.