After opening positively, the Indian indices are trading above the dotted line in the morning session amid outperformance among midcap and small cap stocks. With the exception of engineering stocks, the buying interest is broad based.
The BSE-Sensex is trading up 68 points and the NSE-Nifty is trading up 22 points. The BSE Mid Cap index is trading up 1% and the BSE Small Cap index is trading up 0.8%. The rupee is trading at 62.23 to the US dollar.
Software stocks are trading mixed today. While Tech Mahindra and Tata Consultancy Services (TCS) are among the stocks leading the gainers; Infosys and Wipro are among the stocks leading the losers. According to a leading financial daily, India's second largest software firm, Infosys, has started to more some work out of the US. Infosys is concerned about the effects of the US immigration bill that is pending in the US congress. To de-risk its business to the maximum possible extent, if the bill were to become law, Infosys has moved certain cost centers, such as general, administrative and sales-support functions, offshore. The company is also looking to lower its dependence of low margin on-site activities, by shifting it offshore wherever possible. The bill which has already been passed by the US senate will be taken up by the US house of representatives, for discussion soon. The bill seeks to increase visa costs as well as salaries of H1-B visa holders, making it difficult for companies such as Infosys to carry on its US operations profitably. Infosys is trading down 1% today.
Most telecom stocks are trading higher today. Reliance Communications and Mahanagar telephone Nigam Ltd (MTNL) are among the stocks leading the gainers. According to a leading financial daily, the telecom commission, the highest decision making authority in the telecom ministry, will meet again in the next few days to take a call on the annual spectrum usage charges (SUC). The meeting held today has proven to be inconclusive. The telecom regulator, TRAI, had in September, recommended levying a uniform SUC of 3% of the revenues earned by mobile operators from April 1, 2014 and keeping the upper limit of SUC at 5%. The SUC currently varies from 3-8% for 2G and 3G providers and 1% for holders of broadband wireless access (BWA) spectrum that can be used for 4G services. If a uniform SUC is implemented, it will benefit incumbent players like Bharti Airtel, Idea Cellular, Reliance Communications and Vodafone but will increase the rate for Reliance Jio Infocomm Ltd (RJIL).