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Indian Stock Market News, Equity Market and Sensex Today in India | Equitymaster
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Markets move into the red 
(Tue, 7 Jan 11:30 am) 
 
After opening on a positive note, Indian equity markets have nosedived in to the negative territory and traded in red during the previous two hours of trade. Blue chip stocks have proved to be a major drag. Stocks from Banking, Oil & Gas and Metals have witnessed maximum selling pressures.

The BSE Sensex is trading down 68 points and the NSE-Nifty is trading down 24 points. The BSE Mid Cap index is trading down 0.04%, while the BSE Small Cap index is trading up 0.4%. The rupee is trading at 62.37 to the US dollar.

Almost all energy stocks are trading on a weak note with HPCL, ONGC and Petronet LNG leading the pack of losers.

As per a leading financial daily, ONGC Videsh an overseas arm of explorer major ONGC, is considering various options to fund the acquisition of a Mozambique gas field. The field has the potential to become world's largest hub for producing liquefied natural gas. The company is exploring options such as raising funds in exchange for its future oil output from its producing assets like Russia or Brazil. It is also considering other options like term loans, bond issue and so on. However, the cost of funds would be a key catalyst for fund augmentation.

Notably, the company along with Oil India has acquired 10% stake in June 2013 in the Mozambique deepwater gas field from Videocon for $2.5 bn. Further, during August it bought another 10% in the field for little over $2.6 bn. ONGC Videsh has already raised $1.5 bn through bridge loans to fund the acquisition and expects to raise another $2.5 bn by March 2014.

This comes as a positive move and we also believe that the long term prospects for the company stand bright. However, decline in production rate from mature fields and subsidy burden remain the concern areas for ONGC.

Engineering stocks are trading on a mixed note with Suzlon and BHEL leading the pack of gainers whereas Sanghvi Movers and BGR Energy are facing the maximum selling pressures.

As per a news daily, BHEL has completed its construction of a sub-station at Raichur in Karnataka. The sub-station connects Power Grid's transmission link between southern grid to national electricity grid. The project comprise of transfer of electricity to the southern region from other parts of the country during peak demand as well as transfer of surplus power from the south during the off-peak hours. BHEL's operational activities constitute designing, engineering, manufacturing, supply, erection, testing and commissioning. The project reached the completion stage 5 months ahead of schedule (completion date: May 2014) and incurred total cost of Rs 8 bn.However, the going seems to be not easy for BHEL. We believe, FY14 will continue to be impacted by slow execution and thinning margins. Nonetheless faster projects clearance from Cabinet Committee on Investment (CCI) may help BHEL improve its order inflow and in turn revenues and margins in years to come.

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