Indian indices continued their downward tumble during the previous two hours of trade due to persistent selling pressure. With all major indices in the red, the metals, consumer durables and banking sector stocks were the worst hit.
The BSE-Sensex is currently trading lower by about 266 points, while the NSE-Nifty is trading lower by about 82 points. Stocks from the midcap and smallcap spaces are not in favour as well today. While the BSE-Midcap Index is lower by 1.7%, the BSE-Smallcap Index is trading lower by 2.4%. The rupee is trading at 45.13 to the US dollar.
All bank stocks are under severe selling pressure with Yes Bank being the biggest loser. Yes Bank, India's new age private sector bank, entered into a strategic partnership with National Collateral Management Services Limited (NCMSL), a major agri-infrastructure player, for collateral management and warehousing services. The objective of these services will be to assist industries, traders and farmers in financing their capital requirements at all stages of the supply chain, ranging from pre-harvesting to the marketing and export stages. Yes Bank will also avail of their premium services such as working capital financing in commodity-based industries, especially agro-based industries.
YES Bank holds a stake in NCMSL, and has also fully underwritten its long-term funding requirements to add warehousing capacity across the country. NCMSL is a national level institution to provide risk management solutions in the areas of commodity and inventories.
Metal stocks are currently trading weak led by Jindal Saw, JSW Steel and Tata Steel. A leading business daily has reported that steel manufacturers are looking at increasing product prices by more than Rs 1,500 per tonne from next year. This is due to the rising costs of their input costs, which mainly include coal and iron ore. In addition, international steel prices have been moving upwards as the world’s largest metal consumer, China is believed to be in a recovery stage. This does not come in as good news for the manufacturing lot (such as automobile manufacturers and other consumer goods manufacturers) as they have already been witnessing input cost pressures in the past few quarters.