The Indian markets have started today's session on a positive note. The benchmark indices opened above the breakeven mark and have stayed in the positive territory. Other key Asian markets are in the green with Indonesia (up 3%) leading the pack of gainers. The US markets ended lower by 0.2% yesterday.
Currently in India, heavyweights from the BSE-Sensex are trading strong with software majors attracting investors' interest. The BSE-Sensex is trading higher by around 150 points, while the NSE-Nifty is up by about 50 points. Buying interest is also being witnessed among mid and small cap stocks as the BSE-Midcap and BSE-Smallcap indices are trading higher by 0.5% and 0.5% respectively. The rupee is trading at 46.42 to the US dollar.
Steel stocks have opened the day on a strong note. Gainers here include Tata Steel and SAIL. As per a leading business daily, Tata Steel will acquire an 80% interest in the direct shipping ore project of New Millennium Capital Corp, Canada (NML). It will reimburse 80% of NML's cost to date on the project. It will also arrange funding of up to Rs 13.5 bn of capital costs for the project. Tata Steel will also take the project's entire iron ore production of a specified quality, at global market prices. NML will produce 4 m dry tonnes of iron ore products per year, starting 2012. Tata Steel has a 27.4% stake in NML. This is a positive development for Tata Steel as the project's location, infrastructure and ore quality ensure a reliable and consistent source of supply. It helps achieve the company's drive for raw material security, aimed at buffering its European operations against volatility in the market. Tata Steel Europe accounts for around 65% of the group's production capacity, but has no captive mines.
Power stocks have opened the day on a positive note. Gainers here include Power Grid and NHPC. As per a leading business daily, the government has reprimanded NTPC for delays in developing coal blocks allotted to it. NTPC has been allotted 8 captive coal mines, with reserves of around 5 bn tonnes, by the coal ministry over the past six years. They were expected to come into production between April 2008 and March 2012. However, not a single block has commenced production so far. As a result, it has adversely affected India's captive coal production target. India's target is to achieve 51 m tonnes of captive coal production by 2012. The company has confirmed that production in these mines will start only by 2012 due to uncertainty of coal evacuation link and forest and environment clearance. It may be noted that the coal ministry has recently decided to take back two blocks allotted jointly to NTPC and Coal India due to the delay in development.