The BSE-Sensex is trading down by 107 points while NSE-Nifty is trading 37 points below the dotted line. The BSE-Midcap
and BSE-Small cap
indices are down by 0.3% each. The rupee is trading at 44.40 to the US dollar.
Software stocks are currently trading mixed with NIIT Ltd, CMC Ltd and Tech Mahindra leading the pack of gainers. However, Infosys, Wipro and TCS are trading weak. As per a leading financial daily, profit margins of Indian software firms are going to fall as top outsourcing clients such as Walmart, Home Depot, Cisco, and Ericsson have asked these firms to reduce rates by up to 15% for software development and other back office jobs. As per customers and outsourcing consultants, the business from Information Technology (IT) outsourcing will continue to grow, but at lower profitability. While salaries for Indian staff have risen by 10-15 %, the new recruits too are coming at higher compensation in the software sector. As per the experts, lower rates for the business with the recent wage hike are going to dent the profitability of the software companies.
Most of the banking stocks are trading in the red led by Bank of Baroda, Vijaya Bank and Central Bank. However, Allahabad Bank is trading flat. As per a leading financial daily, public sector lender Bank of Baroda (BoB) plans to open 10 to 12 overseas branches in the current financial year. As per M D Mallya, Chief managing director of the company, new branches could be opened in East African countries of Kenya, Uganda, Tanzania and Botswana. The company is also planning to open a joint venture company in Malaysia. The company has witnessed a moderation in credit growth in the April-June quarter of 2011.