Indices in the Indian equity market came off the day's lows during the closing stages but still closed the session in the red. Thus, while BSE-Sensex edged lower by around 59 points (down 0.3%), NSE-Nifty was down around 20 points. BSE Mid Cap and BSE Small Cap indices fared worse, edging lower by 0.9% and 1.3% respectively. Three stocks went down for every two that closed the day in the positive on the Sensex.
While most Asian stocks closed the day in the red, Europe is trading in the positive currently. The rupee was placed at Rs 53.3 to the dollar at the time of writing.
It is now clear that the rate cut put in place by the Reserve Bank of India (RBI) is not going to do much to lift investor sentiments. Perhaps they've already got wind of the fact that as long as inflation remains high, any more rate cuts are unlikely to happen. Besides, the risk in the developed world also seems to be growing what with yields in Euro nations like Spain and Italy again heading northwards. The US is not in the best of shapes either and all of this point towards a weak market environment in the near future. However, it will not hurt to make good investments from a long term point of view at these market levels.
Bajaj Electricals, India's leading consumer appliance and lightings manufacturer recently announced its 3QFY13 results. The company's bottomline witnessed a huge fall of around 64% on the back of a 10% growth in topline. The performance was affected by the 18% fall in revenues of the company's Engineering & Projects division. What more, the segmental profits came in at negative Rs 400 m, leading to the huge fall in overall profits. With the company providing for cost overruns and taking up a major clean up act, the segment is likely to remain under pressure over the next 2-3 quarters as well. The stock closed lower by around 3% today.
Another stock that closed lower today was the two-wheeler major Hero MotoCorp. The stock was down around 2% presumably on the back of reports doing the rounds that the workers of the company have demanded doubling of monthly salary to near Rs 1 lakh per month and also other benefits like subsidized housing as well as interest free loans. It looks unlikely however that the management would give in to the demands for such a radical change will have serious consequences on the profitability of the business. Some amount of wage increase would definitely be forthcoming though and is likely to add to the growing list of worries that the company is already grappling with.