Backed by persistent selling pressure across index heavyweights, the Indian markets continued to trade weak in the last two trading hours. Majority of the sectoral indices, are trading negative with IT, auto and banking stocks witnessing the largest sell-offs. Only capital goods, realty and power stocks are trading positive.
Majority of the public sector banking stocks are trading negative with Punjab & Sind Bank and Central Bank being the biggest losers. As per a leading financial daily, State Bank of India (SBI), the largest public sector bank, has slashed deposit rates by 25 basis points (0.25%) on tenure below 240 days. The bank will offer 7% on deposits with a maturity of 7-180 days and 7.25% on deposits with a maturity of 180-240 days. However, the bank will continue to offer 9% interest on deposits having tenure of 1 to 3 years. The recent cut in deposit rates in select tenures has fuelled expectation of reduction in lending rates offered by the bank. This move comes amidst rising anticipation of rate cuts by RBI in its mid-quarter review of monetary policy 2012-13 on June 18 to boost the sagging investment climate. The stock of SBI is down 0.94%.
The engineering stocks are trading mixed with Bharat Earth Movers being the biggest loser and Honeywell Automation being the biggest. As per a leading financial daily, Bharat Heavy Engineering Ltd (BHEL) commissioned the second unit of 250 MW (mega-watts) at Harduaganj thermal power project in Uttar Pradesh. The first unit was commissioned in September 2011 and with the completion of the project, six million units of electricity will be provided to the grid of the power-deficit state daily. BHEL is also executing a 250 MW unit at Paricha and two units of 500 MW each at Anpara TPS for Uttar Pradesh Rajya Vidyut Nigam Ltd. BHEL's stock is presently up 0.9%.