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Markets off to a weak start
Thu, 10 Dec 10:30 am

The Indian markets have started on a weak note as the benchmark indices opened below the breakeven mark on the back of weak Asian cues. They have not managed to move upwards towards the dotted line since then. Asia is currently trading in the red with Taiwan (down 1.8%) leading the pack of losers. The US markets closed higher by 0.5% yesterday.

Currently, in India, heavyweights from the BSE-Sensex are trading a mixed bag with metal and select auto stocks leading the pack of gainers. However, banking majors are in the red currently. The BSE-Sensex is trading lower by 24 points, while the NSE-Nifty is down by 8 points. However, buying interest is being witnessed among mid and small-cap stocks as the BSE-Midcap and BSE-Smallcap indices are trading higher by 0.3% and 0.7% respectively. The rupee is trading at 46.64 to the US dollar.

Aluminium stocks have opened the day on a positive note. Gainers here include Hindalco and Nalco. As per a leading business daily, India's largest aluminium producer, Hindalco plans to raise debt to the tune of Rs 45 bn. These funds will achieve financial closure for the new 1.5 m tonne (mt) per annum Utkal refinery in Orissa. The refinery involves an estimated capital expenditure of Rs 65 bn and is expected to start production from July 2011. It part of the company's overall capital expenditure of Rs 230 bn over the next three years for new plants in Orissa, Madhya Pradesh and Jharkhand. In our view, these projects will significantly enhance the scale of company's operations. It will add to its competitive strength by virtue of being one of the lowest-cost producers of alumina and aluminium worldwide in a regime where cost curves are shifting upwards .

Auto stocks have opened the day a mixed bag. Gainers here include Bajaj Auto and Maruti Suzuki, while Hero Honda is in the red. As per a leading business daily, Bajaj auto will completely exit the scooters markets in the next three months. Currently it manufactures the automatic scooter, Kristal, in small numbers. It also plans to drop the brand "Bajaj" from its three-wheelers and call it just 'RE'. These moves are part of Bajaj's strategy to focus on the lucrative motorcycle segment. In fact, its aim is to become the number one motorcycle company in the world. Bajaj auto's decision is based on the fact that motorcycles are more profitable and are growing faster. Moreover, the rapidly emerging high-end bike segment requires focus on the company's part. Honda of Japan, including Hero Honda's contribution, is the world's largest manufacturer of motorcycles currently.

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Feb 22, 2018 01:23 PM