Investing in India? Get Equitymaster Research  

Indian share markets open weak 
(Thu, 15 Nov 09:30 am) 
Barring Japan (up 1%), most Asian stock markets have opened the day on a weak note with stock markets in South Korea (down 1.6%) and Hong Kong (down 1%) leading the losses in the region. The Indian share market indices have opened the day on a weak note. Stocks in the auto and IT space are leading the losses.

The Sensex today is down by around 137 points (0.7%), while the NSE-Nifty is down by around 40 points (0.7%). Mid and small cap stocks are also trading in the red with the BSE Mid Cap and BSE Small Cap indices down by around 0.4% and 0.2% respectively. The rupee is trading at Rs 55.06 to the US dollar.

Telecom stocks have opened the day on a firm note with Bharti Airtel, Reliance Communications and Idea Cellular leading the gains. The 1,800 megahertz (MHz) 2G spectrum auction ended on the second day on November 14, 2012. The government managed to rake in merely Rs 94.07 bn against an ambitious target to raise Rs 300 bn as only 101 out of the 144 blocks could be sold. While Idea Cellular won spectrum in 7 circles including Assam, Kolkata, West Bengal, Jammu & Kashmir, Odisha, Tamil Nadu and the north east, Bharti Airtel won spectrum in only one circle in Assam. On the other hand, while Telenor and Videocon got spectrum in 6 circles each, Vodafone won spectrum in 14 circles. Only 20% of the total value of the spectrum (GSM and CDMA) at a base price of Rs 480 bn was sold. The reason for the low percentage was mainly due to the fact that there were no takers in the three big circles of Delhi, Mumbai and Karnataka. These 3 circles together accounted for over 48% of the total base price. Moreover, CDMA auction could not take place on account of no interest among operators. Had the government not put the Delhi, Mumbai and Karnataka circles up for auction, its total earnings would have been 67.92% of the reserve price for the 18 circles being auctioned.

Engineering stocks have also opened the day on a weak note with Manugraph India, AIA Engineering and Cummins India trading in the red. At the United Nations' (UN) climate talks in November in Doha, the US and other major developed economies could compel a decision to order a global ban on existing refrigerant gases and replace them with costly though relatively more climate-friendly alternatives. If this decision goes through, air conditioners and refrigerators could get quite expensive starting from the summer of 2013. One of the alternatives being proposed is produced jointly by two US-based multinationals DuPont and Honeywell. The other alternative is produced by Japanese company Daiichi Sankyo Company Ltd. A decision in favour of climate-friendly alternatives could result in windfall gains for these companies holding the patents. Another UN convention has already mandated that the industry shift away from HCFC22 starting 2013 and phase it out by 2030. The Indian industry is shifting to HFC410A which is a less harmful gas. But now, the developed world has stepped up pressure to demand that all countries transit to newly found, much costlier but greener alternatives. If this happens, this would significantly push up the cost of consumer products that depend on these gases.
View all commentaries | Archives  RSS
Read the latest Market Commentary
 
BSE-30
 

 
Go
 
 
 
Equitymaster requests your view! Post a comment on "Indian share markets open weak". Click here!
  
 
 

S&P BSE SENSEX
26,932.04 (1.13%)
Sep 18, 2014 11:06 AM
View Detailed Quote

OTHER USEFUL LINKS

MARKET STATS
 
BSE-30
 

 
   Go