Indian share markets open firm

Mon, 26 Aug 09:30 am

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Barring Indonesia (down 0.2%), all major Asian stock markets have opened the day on a firm note with China (up 1.4%), South Korea (up 0.9%) and Hong Kong (up 0.9%) leading the gains. The Indian share market indices have opened the day on a positive note. Stocks in the capital goods and healthcare space are leading the gains.

The Sensex today is up by around 114 points (0.6%), while the NSE-Nifty is up by around 26 point (0.5%). Mid and small cap stocks are also trading in the green with the BSE Mid Cap and BSE Small Cap indices up by around 0.6% each. The rupee is currently trading at Rs 63.19 to the US dollar.

Auto stocks have opened the day on a weak note with Eicher Motors, Hero MotoCorp and Bajaj Auto leading the gains. As per a leading financial daily, India's leading passenger vehicle maker Maruti Suzuki's plans to set up manufacturing plants in Gujarat are likely to be adversely impacted. This is owing to the demand slowdown in the auto industry as well as continued agitation by farmers against land allocation. Earlier during the month, the Gujarat state government had reduced the area for the proposed Mandal-Becharaji special investment region (SIR) from 500 sq km to 100 sq km by omitting 36 villages from the original plan following protests by villagers. As a result, there are now just eight villages in the proposed investment region. However, farmers of these villages too are demanding their land back.

It must be noted that in June 2012, Maruti had signed a state support agreement with Gujarat to purchase land near Mehsana for its future expansion plans. It is expected to invest about Rs 40 bn for building a plant to manufacture cars for domestic and export markets.

Information technology stocks have opened the day on a mixed note with Wipro and Mphasis Ltd leading the gains. However, Moser-Baer India and NIIT Ltd are trading in the red. As per a leading daily, IT major Infosys has sought the approval of the Union Ministry of Corporate Affairs (MCA) on the appointment of Rohan Murthy as executive assistant to his father, NR Narayana Murthy who returned from retirement as chairman and whole-time director of Infosys in June 2013. It must be noted that as per the Companies Act, the appointment of relatives of board members requires approval from the ministry. On August 3, 2013, the company's shareholders ratified the appointment of Murthy and his son for five years with a token salary of Re 1 per annum. It is said that Rohan Murthy is likely to be re-designated as Infosys vice-president. However, there has been no official announcement by the company on this matter.