Auto stocks are trading weak led by Mah. Scooters, Tata Motors. According to a leading financial daily, Mahindra and Mahindra (M&M) is likely to raise tractor prices by 1.5% to deal with rising input costs. The new rates will be introduced in a month or so. The auto company however will still be absorbing most of the rise in costs. M&M had earlier raised the tractor prices in June this year by Rs 5500 per unit. This followed a rise in material costs by Rs 45,000 to Rs 50,000 per truck. It may be noted that tractor segment grew by 20% in fiscal year 2010-11. But, slowdown may result in only 13% growth this year. Also, M&M has recently launched a range of pick-ups by the name of Mahindra Genio. This new offering provides both style and power at the same time. It is a mixture of international styling, luxurious interiors, comfort and safety.
Banking stocks are trading weak. All stocks in the sectoral index are trading in the red except for Union Bank of India which is the only stock trading in green. India's largest public sector bank State Bank of India (SBI) has doubled its overseas borrowing medium term note (MTN) programme from USD$ 5 bn to USD$ 10 bn. SBI has also extended 25 basis point concessional home loan scheme from 31 October 2011 to 31 December 2011. Under this scheme the borrower will now be charged an interest of 10.5% as against 10.75% on loans up to Rs 3 m. As per the new scheme a loan above Rs 3m but up to Rs 7.5 m will attract an interest of 10.75%.Many banks like Housing Development Finance Corporation (HDFC Bank), Industrial Credit and Investment Corporation of India (ICICI Bank) have recently launched dual interest rate products offering a fixed rate of interest to start with, which will be later aligned to the base rate as the loan progresses in order to attract more home loan customers.