Markets continue in the red

Mon, 20 Jun 01:30 pm

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Indian stock markets continued to fall during the last two hours of trade on the back of relentless selling activity across index heavyweights. Stocks from the realty and power space are trading in the red, while stocks from the consumer durables space are trading firm.

The BSE-Sensex is trading down by 257 points while NSE-Nifty is trading 79 points below the dotted line. BSE Midcap and BSE Small cap indices are both down by 2.5% and 2.6% respectively. The rupee is trading at 45.01 to the US dollar.

Aluminum stocks are trading weak led by Nalco and Hindalco. As per a leading financial daily, National Aluminium Company (NALCO) is planning to acquire upto 30% stake in a coal supplier in Indonesia. The two companies - West Asia-based MEC Coal and Bumi Muara Prasada are bidding for the contract to supply coal to the company's Rs 180 bn east Indonesia based Kalimantan aluminium cum power project. The valuations are being worked out and bids are expected to be finalized by June end. As per the management, the mining companies are not ready to offer majority stake. However, it is essential to have at least a minority stake in the companies which supply coal to NALCO to secure long term supplies. Nalco has already selected UAE-based RAK Minerals as its joint venture partner to set 0.5 MT aluminium smelter and 1,250 MW captive thermal power plant in East Kalimantan, Indonesia, as part of its ongoing Rs 580 bn capacity expansion plan.

Power stocks are trading weak with Jaiprakash Power and Reliance Infra leading the pack of losers. As per a leading financial daily, the coal ministry has warned NTPC of cancelling two more coal blocks if they are not developed immediately. In the last week itself, the company's five coal blocks were cancelled by the Government. The company may also suffer coal imports shortage in the eastern part of the country as importers threaten to pull out of Haldia Dock Complex on account of payment issues with the authorities. In separate news, the Prime Minister will review coal power projects on July 1. In an effort to sort out the inter ministerial differences leading to delays in execution of projects, he has called a high level meeting to resolve issues like coal shortage and environment clearances. The stock was trading in the red.