Auto, banks weigh on markets

Tue, 22 Feb 01:30 pm

   Previous Close   

   Pre-Open   

   09:30 am   

   11:30 am   

   Closing   

The Indian markets are trading below the dotted line as of now. Most of the sectoral indices are trading weak with the BSE-Auto, BSE-Bankex and BSE-Capital Goods indices leading the pack of losers. The BSE-Oil & Gas index, however, bucks the trend and is trading higher on the back of a 4% gain in Reliance Industries.

The BSE-Sensex is trading lower by about 95 points (down 0.5%) while the NSE-Nifty is trading lower by about 33 points (down 0.6%). Small and midcap stocks have also followed suit as the BSE Midcap and the BSE Small cap indices are trading lower by about 0.6% and 0.3% respectively. The rupee is trading at 45.13 to the US dollar.

Automobile stocks lead the pack of losers with Hero Honda, Ashok Leyland, Tata Motors and M&M trading deep in the red. According to a leading daily, M&M's foray into the US has hit a roadblock. Its light pickup truck is facing a marketing setback with the vehicle fetching American fuel economy rating of 19 miles per gallon in city and 21 in highways. This is lower than the 30 miles per gallon that the company promised its retailers and is on par with the existing established models such as Toyota Tacoma and Ford F 150. This set back comes nearly a year after M&M's US dealer Global Vehicles took the company to court over delays in the launch of the vehicle. M&M officials have said that the stats look worse because of change in the methodology for calculating the mileage used by the US Environmental Protection Agency. M&M is scheduled to launch a few more fuel efficient vehicles in the coming months. These products would be positioned as a small, high-mileage diesel range to take on more established rivals like Toyota and Ford.

Shipping stocks are trading weak led by GE Shipping, Mercator Lines, and ABG Shipyard. GE Shipping, through its Singapore incorporated subsidiary, has placed an order for construction of one mobile offshore self-elevating drilling rig with Lamprell Energy Ltd. The said rig is due for delivery in 3QFY13. The rig is an independent leg cantilever type jack up rig with 15,000 PSI pressure rating designed to operate in water depths of up to 350 feet and will have a rated drilling capacity of 30,000 feet. Last month the Singapore based subsidiary, Greatship Global Energy Services Pte Ltd entered into an agreement for purchase of 350 feet jack up drilling rig Greatdrill Chetana. This is the third jack up rig that will be owned by its Singapore based subsidiary.