As per reports, ratings agency S&P has warned of a possible downgrade in India's credit rating, citing reasons similar to what were mentioned a few months ago. These include the slowdown in growth within India and global economies as well as slowing reforms. However, it has added that there is also a possibility of the ratings being revised to stable provided the government goes ahead with the measures to curb the deficit levels, improve the overall investment climate and increase growth prospects. For now, the agency along with Fitch, have put India's ratings on watch on account of the above-mentioned factors (measures to curb deficits) not being in the comfort territories. It may however be noted that Moody's expects India's fiscal deficit to cross the 5.1% mark this year despite the recent moves by the government to rein in deficit. Over the past few weeks, agencies including the ratings agencies - have been cutting India's GDP forecasts as against what was predicted a few months ago.
Most of the auto stocks are trading in red led by TVS Motors and Escorts. Automobile sales continued to be adversely impacted by high interest rates, rising fuel costs and economic slowdown. As per Society of Indian Automobile Manufacturers (SIAM), car sales fell 5.4% in September to 1.57 lakh units. Even the offtake of motorcycles slumped by 18.9% to 7.53 lakh units. Truck & bus sales stagnated at 70,683 units for the month. In the wake of the gloomy demand scenario, SIAM has slashed the car sales growth for FY13 from its previous estimate of 9-11% to a mere 1-3%. The industry body has cut FY13 motorcycle sales growth estimate from 11-13% to 5-7% whereas commercial vehicle sales growth has been downgraded from 6-8% to 3-5% for the year.