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Sensex, Nifty under pressure; HDFC drags, Infosys TCS up


TheNewsInternational Team

10:20 am Moody’s on realty developers:

Weak housing sales and stagnant prices will pose challenge to big real estate developers over the next 12 months as their cash flows and project execution capabilities get affected, ratings agency Moody’s said.

Developers will not reduce price to boost sales, rather will continue with their strategy to reduce apartment size and offer freebies, Moody’s Investors Service said. However, the agency said that “solid economic growth” would give some support to housing sales, while gradual easing of lending rates would boost investment activity.

“India’s largest property developers will continue to face a challenging operating environment over the next 12 months including weak cash flows, flat sales and stagnant prices,” the agency said in a statement while releasing a report on the Indian property market titled ‘Cash Flows to Remain Weak Amid Flat Sales and High Costs’ on Tuesday. Sales volumes will remain weak because of unaffordable housing prices, resulting in unsold inventories.

“Aggregate cash flow for India’s largest property developers will remain weak over the coming 12 months because the companies’ sales will be flat and their costs will stay high,” Moody’s said, adding that the construction costs have increased in the past four years owing to high inflation.

10:00 am Market Check

The market fell for the second consecutive session today, dragged by banking & financials, capital goods, FMCG and select auto stocks. Weak July core sector data and lower than expected first quarter GDP hurt sentiment. Even weak global cues have an impact on market.

The Sensex declined 176.38 points to 26106.71 and the Nifty fell 52.85 points to 7918.45. The BSE Midcap and Smallcap indices lost 0.3-0.7 percent. About 568 shares have advanced, 1139 shares declined, and 60 shares are unchanged on the BSE.

HDFC topped the selling list on Sensex, down 2.4 percent followed by HDFC Bank, L&T, Reliance Industries, SBI, Axis Bank, Lupin, Tata Motors and Bharti with 1-1.9 percent loss.

However, Infosys, TCS, Sun Pharma and ONGC bucked the trend, up 1-1.5 percent.


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