Most Asian stock markets have opened the day on a weak note with stock markets in Singapore (down 1.5%) and Taiwan (down 1.5%) leading the losses. However, the markets in China (up 0.4%) are trading firm. The Indian stock market
have opened the day on a weak note. Stocks in the capital goods and metal space are leading the losses.
The BSE-Sensex is trading marginally lower by 67 points (0.4%), while the NSE-Nifty is down by around 21 points (0.4%). While the BSE Mid Cap index is trading lower by 0.1%, the BSE Small Cap index is trading flat. The rupee is trading at 51.83 to the US dollar.
Steel stocks have opened the day on a weak note with Tata Steel, JSW Ispat and JSW Steel leading the losses. However, Steel Authority of India Ltd (SAIL) is trading in the green. Given the near to medium term sluggish outlook for the steel industry, steelmakers are now focusing on the rural markets to drive growth. State-owned firm SAIL is not only planning to set up retail shops in rural areas, but is also in the process of setting up 1,000 dealerships in villages. Currently, the steelmaker has about 2,700 dealers across 630 districts in India. The company is aiming to sell more branded steel in the rural markets and increase its nation-wide reach. It is even ready to bear the transportation costs of delivering steel to its dealers. While the domestic steel demand grew at a compound annual growth rate of 10% over the last five years, steel demand during the first half of the current financial year grew at a meagre 2.9%.
Engineering stocks have also opened the day on a weak note with Larsen & Toubro (L&T), Thermax and Bharat Heavy Electricals Ltd (BHEL) trading in the red. Engineering company L&T has been able to add five new orders worth Rs 27 bn to its kitty in various segments such as construction, electricity and infrastructure. In a regulatory filing the company said that its buildings and factories segment had bagged orders worth Rs 11.09 bn for construction of a residential complex. The buildings and factories segment also bagged an order for construction of a warehouse facility. L&T bagged sizeable orders in the power transmission and distribution segment worth Rs.7.63 bn. The company has also secured international orders worth Rs 2 bn from Tatweer Petroleum (Bahrain) for electrical projects, including additional contracts from other clients for ongoing projects. In the infrastructure space, the company has bagged an order worth Rs 3.53 bn for construction of a viaduct, including two-station buildings, for Kolkata Metro. In additional, it also managed to bag an order valued at Rs 2.72 bn for rehabilitation and automation of the existing 116 million gallons per day water treatment plant of Delhi Jal Board.