Indian equity markets have been trading in the red over last two hours of trade on the back of selling pressure witnessed in index heavyweights. All sectoral indices are trading weak led by consumer durables and realty stocks.
The Sensex today is trading lower by 94 points and NSE-Nifty is trading down by 28 points. BSE Mid cap and BSE Small cap indices are trading lower by 0.5% and 0.3% respectively. The rupee is trading at 55.76 to the US dollar.
Telecom stocks are trading weak led by Idea Cellular and Reliance Communications. As per a leading financial daily, Idea Cellular has slashed its 3G rates by 70%. This follows a similar move by the industry leader Bharti Airtel. Idea customers will now have to pay 3 paise per 10 KB of data as against 10 paise per 10 KB paid earlier. The new tariffs will be applicable to both prepaid and postpaid customers. This move by the telecom companies is expected to make internet accessible to rural and mid-town customers who will be using internet for the first time.
Auto stocks are trading in the red led by Hero MotoCorp and Maruti Suzuki. As per a leading daily, the Indian auto companies are looking at ways to deal with the problem of rupee's fall. Automakers are looking at ways of increasing their exports to compensate for the rising import bills. The rupee has declined by 11.5% since February till date. Toyoto Kirloskar Motor is 35-40% dependent on imports of inputs for its vehicles. To deal with rupee's diminishing value, the auto company has decided to export its Etios model to South Africa. Similarly, Honda Siel and Maruti are focusing on localisation strategy whereby the company has been working on its research and development. The management of Honda feels that these efforts are now yielding results in the form of increased local supply.