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Markets will remain closed on April 17, 2024 on account of Ram Navami.

Auto stocks weigh on markets
Thu, 9 Jun 11:30 am

Indian stock market indices have been trading weak over the last two hours of trade on the back of selling witnessed in index heavyweights. Auto and banking stocks are the top losers while stocks from the capital goods space are trading firm.

The BSE-Sensex is down by 23 points while NSE-Nifty is trading 13 points below yesterday's closing. BSE Midcap and BSE Small cap indices are trading flat. The rupee is trading at 44.67 to the US dollar.

Energy stocks are trading in the green led by RIL and Essar Oil. The petroleum sector regulator has extended the deadline for submission of bids for the fourth round of city gas distribution (CGD) projects to July 11. Initially, the auction was scheduled in March but it was delayed due to a stay by the Delhi High Court in January last year. The court had questioned the board's power to issue authorizations for city gas projects and rendered previous authorizations by the PNGRB invalid. Later, in May, the Supreme Court allowed the board to process pending applications for the grant of CGD licenses.

By extending the deadline, the regulator aims to achieve a better response as a lot of private companies in the power, real-estate and infrastructure sector have shown a keen interest this time. However, as per industry experts, the delay in launching the fourth bidding round is because natural gas demand outstrips supply. Now with constrained gas supplies and extremely expensive imported gas, sourcing competitively priced gas has become a major concern for investors backing the companies that want to bid for city gas auctions.

Telecom stocks are trading weak led by MTNL and Reliance Communications. As per a leading financial daily, cell tariffs are all set to rise. The industry players feel that the price war that had been waging till now between the telecom operators is about to end. The air time charges have hit rock bottom and cannot be further reduced. It may be recollected here that the mobile telephony industry has been going through a really tough time. Low air time charges resulting in lower revenue, high pressure on margins, huge investments in 3G infrastructure and 2G scam have severely hit the telecom operators. In the future, the operators plan to focus on customer service and service innovation. For this, they may have to pay certain expenses which will be transferred to the customers in the form of higher tariffs.

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