After opening weak, the Indian Indices continue to trade below the dotted line in the morning session. Most sectoral indices except metal and auto are trading in the red. The selling pressure is the highest in banking and software stocks.
The BSE Sensex is trading down 30 points and the NSE-Nifty is trading down 16 points. The BSE Mid Cap index is trading up 0.3% and the BSE Small Cap index is trading up 0.4%. The rupee is trading at 61.96 to the US dollar.
Most of the private banking stocks are trading lower. Karnataka BankYes Bank are leading the losses; while J&K Bank and City Union Bank are trading in the green. As per a leading financial daily, Kotak Mahindra Bank expects to witness a steep fall in growth in advances of its home loan book. It expects the growth to be about 10% to 15% during the current financial year. It may be noted that the bank's home loan advances has been growing at 30% to 40% over the past 2 years. As of September quarter, Kotak's home loan book stood at Rs 113 bn with a growth of 17% YoY. In the wake of the domestic economic slowdown, people have delayed their home purchases and are waiting for more certainty to emerge with respect to factors like inflation, interest rates, and job prospects. Interestingly, the bank had lowered its home loan interest rate by 0.25% last week on the lines of larger peers like SBI, ICICI Bank and housing major HDFC.
Telecom stocks are trading mixed today. Tata Teleservices and Idea Cellular are among the stocks leading the gainers; while Reliance Communications and Mahanagar Telephone Nigam Ltd (MTNL) are among the losers. According to leading news daily, Indian telecom firms are concentrating their sales efforts on the data and value added services part of their business. The data business is certainly helping the telcos offset the sluggish performance of the voice business. According to the telecom regulator TRAI, the data subscriber base and data traffic have increased by 15% and 23% respectively in the September quarter. Telcos have now started offering freebies to subscribers to cash in on this trend. While Aircel, Tata Teleservices and BSNL are now offering 1 GB data plan for just Rs 125 Bharti Airtel has reduced the price of its 4G dongle to Rs 1,500 from Rs 7,999. Indian telcos expect data services to drive revenue growth going forward helped by sales of tablets and smartphones which will operate on 3G and 4G networks.