Indian stock market continued to trade in the red due to selling pressure in heavyweights over the last two hours of trade. All sectoral indices are trading weak except for the FMCG index. Stocks from metal, oil & gas and software space are losing the most.
The BSE-Sensex is down 151 points while NSE-Nifty is trading 45 points below yesterday's closing. The BSE Midcap and BSE Small cap indices are down by 0.6% and 0.8% respectively. The rupee is trading at 44.06 to the US dollar.
Most of the software stocks been trading weak with HCL Technologies Ltd, Wipro and Infosys leading the pack of losers. However, Mphasis Ltd is trading firm. As per a leading financial daily, the rupee has almost touched its three-year high yesterday. This will adversely impact the business of Indian software exporters. The Rupee has been rising continuously and already impacted the margins of the software industry. Some of the software players like Infosys and Mindtree have reported a negative impact of up to 0.8% on the margins.
Higher volatility in the Rupee has been the concern for the whole software industry. The volatility makes the cash flow management a difficult task for the IT companies. As per Mr Som Mittal, President of IT (Information Technology) industry body Nasscom, it is not clear as to when Rupee will stabilize. But he has cautioned against drawing any conclusion from this sudden volatility of the curerncy. According to industry experts, most of the companies are well hedged. Therefore, the volatility in the Rupee should not impact the business adversely.
As per Mr Govind Shrikhande, Managing Director of the company, there exists a strong possibility of a strategic alliance or a joint venture particularly on the food side, once the rules on FDI are clear. Shoppers Stop currently runs its food business under hypermarket Hypercity. This apparel and accessories retailer also runs specialty stores such as Crossword, Mothercare and MAC.