Rupee at near 2-month high tracking shares, Asian peers

MUMBAI: The Indian rupee strengthened to its strongest level in nearly two months on Friday, boosted by gains in domestic shares and other Asian currencies, but the euro's losses versus the dollar may limit very sharp gains.

At 9:49 am (0419 GMT), the partially convertible rupee was at 44.56/57 per dollar, its strongest since May 5. Local shares were up half a percent, taking cues from firm Asian markets, with fears of an imminent default by Greece receding.

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Sensex up in early trade

MUMBAI: A benchmark index for Indian equities markets made a positive start on Friday.

The 30-scrip sensitive index ( Sensex) of the Bombay Stock Exchange (BSE), which opened at 18,974.96 points, was ruling at 18,942.41 points, up 96.54 points or 0.51 percent from its previous close at 18,845.87 points.

The 50-scrip S&P CNX Nifty of the National Stock Exchange was also trading in the green at 5,668.55 points, up 0.37%.

Broader markets too saw moderate gains with the BSE midcap index ruling 0.47% higher and the BSE smallcap index up 0.51%.

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Sensex jumps 201 points to two-month high

MUMBAI: In a five-day long rising streak, the BSE benchmark index Sensex climbed to a two-month high adding over 201 points on buying by funds on expectations of better economic growth, shrugging off inflationary concerns.

The 30-share index, which had gained nearly 943 points in last four sessions, advanced further by 201.41 to 18,693.86, a level last seen on May 2.

Investors covering their pending short positions ahead of the ending of June month contract expiry in the derivatives segment tomorrow, further also fuelled the uptrend, marketmen said.

A firming trend in global markets on easing concerns of European sovereign debt crisis also boosted the sentiments.

Trading sentiment turned bullish as Finance Minister Pranab Mukherjee stood by his economic growth target even after the longest string of monetary tightening measures in a decade, brokers said.

Mukherjee said the economy will grow by 8.5% in 2011-12 and the recent hike in prices of petroleum products will not have much impact on the fiscal deficit.

In similar fashion, the broad-based National Stock Exchange index Nifty traded above 5,600 mark level by adding 55.15 points to settle at 5,600.41.

The rally was mostly contributed by FMCG, metal, banking, IT and realty stocks. The FMCG sector index gained the most by 2.58% to 3,972.89, followed by the metal index that rose by 1.52% to 14,987.98.

Market heavyweights Reliance Industries and Infosys Technologies closed with handsome gains. RIL rose by Rs 14.75 to Rs 885.30 and Infosys by Rs 17.90 to Rs 2,881.75.

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Rupee gains 4 paise against US dollar

MUMBAI: The rupee appreciated by 4 paise to Rs 44.99 per dollar in opening trade on the Interbank Foreign Exchange on Tuesday, supported by dollar weakness against the euro and other Asian currencies and a higher opening in the stock market.

The rupee fell by 4 paise to close at 45.03/04 against the American currency in Monday's trade despite bullish domestic equities.

Forex dealers said dollar weakness against the euro and other Asian currencies overseas and a better opening in the stock market kept the rupee sentiment firm against the American dollar in opening trade.

TOI

Sensex down 19 pts after 3-week high

MUMBAI: The BSE benchmark sensex surged to a three-week high in early trade on Tuesday but failed to maintain the initial gains and was trading down by 19 points at 10.15am on profit-booking in oil&gas, IT, realty, FMCG and PSU counters.

The BSE benchmark sensex resumed higher at 18,493.59 and shot up further to a three-week high to 18,527.45 amid strong buying in healthcare, consumer durable, power, capital goods and metal stocks on the back of strong inflows from foreign institutional investors (FIIs).

However, the sensex declined immediately to 18,379,78 before quoting at 18,393.56 at 10.15am, showing a loss of 18.85 points, or 0.10 per cent.

The NSE's 50-share Nifty index also declined marginally by 4.40 points, or 0.08 per cent, to 5,522.20 at 10.15am.

Major losers from the sensex pack include Jaiprakash Associates (down 2.75 per cent), DLF (2.23 per cent), Wipro (1.80 per cent), ITC (1.16 per cent) and TCS (1.01 per cent).

Asian stocks rose in early trade on speculation that Greece may be allowed to roll over some of its bonds, easing concerns that the nation's sovereign debt crisis will spread across Europe, one of Asia's biggest export markets.

Key benchmark indices in Hong Kong, Indonesia, South Korea, Japan and Taiwan were up by between 0.05 per cent and 1.14 per cent. The key benchmark indices in China, Singapore and Taiwan fell by between 0.01 per cent and 0.6 per cent.

TOI

Rupee depreciates by 6 paise against dollar

MUMBAI: Ignoring smart rise in local equities, the rupee depreciated by six paise to close at 44.95/96 against the US currency on the back of a firm dollar overseas and continued funds outflow.

Dealers said that the main reason behind the fall in the rupee was firm dollar overseas.

Moreover, persistent dollar demand from some banks and importers, mainly oil refiners, put pressure on the rupee, they said.

Some dollar sale by exporters, however, capped the fall in the rupee, they added.

FIIs remained net sellers for the ninth straight session and sold shares worth Rs 287.4 crore Wednesday as per provisional data.

The Bombay Stock Exchange benchmark Sensex shot up 177 points to 17,727 as investors ignored spurt in food inflation and a string of concerns over domestic as well as global economic growth, buying heavyweights like RIL and Infosys.

"Globally Dollar gained against the major currencies like EUR, GBP & JPY. It also traded strong against Rupee and touched a major resistance of 45.00. Local equities traded bullishly which helped rupee to end below 45 levels. Expect Rupee to trade above its resistance in coming days," Alpari Forex ( India) CEO Pramit Brahmbhatt said.

"The trading range for the USD/INR will be 44.70 to 45.20 tomorrow," he added.

At the Interbank Foreign Exchange (Forex) market, the local unit opened lower at 44.92/93 a dollar from previous close of 44.89/90 and moved in a range of 44.80 and 45.00 before concluding at 44.95/96.


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India's super rich club 12th largest in the world

NEW DELHI: Number of high net worth individuals (HNWI) is growing in India. HNWI population of the country grew by 20.8% to 1.53 lakh in 2010 compared to 1.26 lakh in 2009, according to the 15th annual World Wealth Report, released by Merrill Lynch Global Wealth Management and Capgemini. Now, India's HNWI population is the world's 12th largest, replacing Spain which dropped to the 14th position.

And the growth of Indian millionaires is fuelled by robust economic and equity-market performance, the report added. "With a GDP growth rate of 9.1% in 2010 and an increase in market capitalization by 24.9%, India offers a great opportunity and continues to remain an important market for wealth management providers worldwide," said Atul Singh, MD and head, Merrill Lynch Global Wealth Management , India.

Indian millionaires also showed growing interest in investments like luxury collectibles (luxury cars, boats and jets), as also in sports, the survey found.

The world's HNWI population expanded and wealth accumulation in 2010 surpassed 2007 pre-crisis levels in nearly every region. Population of HNWIs increased by 8.3% to 10.9 million in 2010 and financial wealth of HNWIs grew 9.7% to reach $42.7 trillion compared to 17.1% and 18.9% respectively in 2009.

Asia-Pacific region has surpassed Europe in terms of HNWI population. It expanded by 9.7% to 3.3 million, while Europe grew 6.3% to 3.1 million, said the report. Wealth of HNWIs in Asia Pacific rose 12.1% to $10.8 trillion, exceeding Europe's 7.2% growth to $10.2 trillion.

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Sensex regains 18k level after 9-days as crude falls

MUMBAI: The BSE benchmark sensex added over 356 points to regain the 18,000-level after nine-days during intra-day trade today on heavy buying in blue-chips after a steep fall in crude prices and easing concerns on fuel prices hike.

The Bombay Stock Exchange benchmark index climbed 356.08 points to 18,083.57 at 1145 hrs, with most oil company stocks rising.

The National Stock Exchange's broader Nifty index rose by 94 points to 5,414.

The trading sentiment improved after oil minister S Jaipal Reddy said his ministry has made no specific proposal on increasing auto and cooking fuel prices for consideration by the EGoM on fuel prices later today, easing concerns of more monetary tightening to curb inflation.

Crude oil prices dropped by 4.6% to $91.02 a barrel in New York yesterday.

The largest state-owned oil explorer, Oil and Natural Gas Corp, surged by 3.18%, the most in a month, to Rs 272.90, while Gas Authority of India gained 2.20% to Rs 446.50.


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Sebi plans to regulate MF distributors

MUMBAI: Market regulator Sebi plans to start regulating mutual fund distributors to make the industry safer and bring down incidences of miss-selling. The plan, now in its formative stage, is to start regulating large distributors, or those who are above a threshold limit, and then based on the experience slowly expand to include other distributors.

"We are looking into distributor regulation, but this will be in a non-disruptive manner," UK Sinha, chairman, Sebi, said at a mutual fund industry conference. "To begin with, this might be for a limited number of large distributors," Sinha added. He was addressing the plenary session at CII's annual Mutual Fund Summit here.

The regulator also plans to look into the stringent advertisement rules that fund houses have to adhere to, which will have lesser but more relevant disclosure than now. Sinha, who during his tenure in the finance ministry had worked on the pension fund regulations bill, advised the fund industry to come out with proposals on how they can tap the pension market in India.

The Sebi chief also said that the regulator was working on having a uniform know your client (KYC) standard for all the market intermediaries under his regulatory purview. Sebi is also planning to look at the track record of fund managers and disclose the same to investors, which could help, especially the retail investors, in taking an informed decision while investing in MF schemes.

To bring in first time investors and grow the mutual fund business, Sebi plans to find some way to remunerate MF distributors. For the top officials of the fund industry who were present at the conference, it was a welcome break, with the regulator assuring it all the support to develop the industry and penetrate deeper into the country. Last year, when former Sebi chief CB Bhave had addressed the same event, some had hoped for a reversal of the entry load, at least partially. However, there was not much from Sebi's side. This year, however, as the Sebi chief extensively cited global fund industry data to put forward his point that the Indian fund industry has a long way to go, chiefs of fund houses came out on a positive note.

"Two things stand out in today's speech. For one, there is a huge need to get new investors into the MF category which is being addressed in the form of distributors' remuneration," said Jaideep Bhattacharya, group president & CMO, UTIMF. "And the proposal for common KYC across all capital market products will bring in lot of convenience to investors," he added.


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Sensex down 41 points in opening trade on weak global cues

MUMBAI: The BSE benchmark Sensex fell by over 41 points in opening trade on Thursday, extending Wednesday's losses on continued selling by foreign funds and retail investors amid weak cues from global markets.

High inflation and rising interest rates also kept the trading sentiment weak.

The 30-share barometer, which lost 9.67 points in Wednesday's see-saw session, moved down further by 41.49 points, or 0.23 per cent, to 17,509.14 in opening trade on Thursday.

Stocks of banking, realty, auto and metal companies remained under pressure.

Similarly, the wide-based National Stock Exchange Nifty index shed 16.30 points, or 0.30 per cent, to 5,262.00.

Market experts said the trading sentiment remained bearish amid a subdued trend on other Asian bourses, tracking overnight losses in the US market.

In addition, high inflation and rising interest rates dampened the trading sentiment, they said.

In the Asian region, Hong Kong's Hang Seng index was trading 0.78 per cent lower and Japan's Nikkei shed 0.74 per cent this morning. In the US, the Dow Jones Industrial Average ended 0.66 per cent lower in Wednesday's trade.

Rupee down 5 paise against US dollar in early trade

MUMBAI: The Indian rupee lost 5 paise to Rs 44.91 per US dollar in early trade on the Interbank Foreign Exchange on Monday, weighed down by dollar gains against the euro and a weak trend in the stock market.

Dealers said strengthening of the dollar against the euro and some other currencies and a lower opening in the stock market mainly put pressure on the rupee.

The rupee rose by 4 paise to close at Rs 44.86/87 against the US dollar in the previous session on Friday on mild selling of dollars.

Meanwhile, the Bombay Stock Exchange benchmark Sensex fell by 72.15 points, or 0.40 per cent, to 17,798.38 in early trade on Monday.

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Sensex tumbles by 384 points on sustained selling

MUMBAI: The BSE benchmark Sensex dropped sharply by 384 points in early trade on Monday, extending its losses for the fourth straight session on sustained selling by foreign funds and retail investors amid mixed global cues.

IT stocks extended their recent losses on weak economic data from the US and the continuing sovereign debt crisis in Europe.

The major losers in early trade were RCom (down 7.10 per cent), Reliance Infra (6.80 per cent), Jaiprakash Associates (4.66 per cent), Cipla (4.37 per cent), M&M (3.59 per cent), Wipro (3.55 per cent) and TCS (3.49 per cent).

Market experts said the trading sentiment remained bearish on concerns of rising interest rates and reports of lower advance tax collections by the government.

The BSE benchmark Sensex resumed higher at 17,925.17, but later it dropped sharply to a low of 17,314.38 before quoting at 17,486.10 at 1015 hours, showing a sharp loss of 384.43 points, or 2.15 per cent, from its last close.

The NSE's 50-share Nifty index fell by 126.60 points, or 2.36 per cent, to 5,239.80 at 1015 hours.

Asian stocks were mixed early on Monday. The key benchmark indices in Japan, Indonesia, Hong Kong and Singapore, rose by between 0.2 per cent to 0.53 per cent. However, the key indices in China, South Korea and Taiwan fell by between 0.08 per cent to 0.88 per cent.

Trading in US index futures indicated that the Dow could fall by 39 points at the opening bell on Monday.

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RCOM and R-Infra out of sensex

MUMBAI: The BSE has decided to take two Anil Dhirubhai Ambani Group stocks-Reliance Infrastructure and Reliance Communications (RCOM)-out of the elite sensex index, which analysts say could lead to a selling pressure on the two stocks. In a late evening development on Friday, the BSE's index maintenance committee simultaneously replaced these two ADAG group scrips on the sensex with Coal India and Sun Pharma.

While Coal India is the most valued PSU and the second most valued company in India with a market capitalization of Rs 2.5 lakh crore, Sun Pharma, with a market cap of nearly Rs 50,000 crore is the most valued pharma company now. The changes are effective August 8, a BSE release said. The exclusion of R-Infra and RCOM is sure to add pressure on these stocks, since fund managers who have benchmarked their funds, including passive sensex-based exchange traded funds, will now be forced to sell these stocks and buy the two scrips which have now been included in the index.

Lately the RCOM stock has been under tremendous selling pressure as it failed to meet the growing challenges in the telecom space with its peers competing fiercely on tariffs, customer service and also acquisition of new clients. The company in particular and the ADA group in general faced another setback when the government agencies investigating the 2G telecom spectrum scam arrested three of its top executives and grilled the group's chairman Anil Ambani. Over the last one year, while RCOM has lost nearly 50% of its value to Rs 95 on the BSE now, R-Infra too lost over 50% to its current level of Rs 580.

RCOM was included in the BSE sensex in June 2006, within months of it being listed on the BSE after the company was demerged from Reliance Industries. It had then replaced Tata Power. Data on the BSE website does not show when R-Infra was included in the elite 30 stocks. The inclusion of Coal India was expected since its blockbuster IPO last November. However, BSE's rules for inclusion in the sensex, among others, required a continuous trading history of six months.

For Sun Pharma, this is the second entry into the sensex, but on both the occasions the same has been dramatic. The stock was first included in the index in January 2009 when it replaced Satyam Computer, soon after the accounting fraud in the software major was revealed. And this time, it is replacing RCOM, which was one of the most talked about stocks on Dalal Street just a few years ago.

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New in-ads notice label and icon

You've probably noticed that AdWords ads appearing on your site have a special "i" icon that expands to an "Ads by Google" label in the bottom corner of the ad. Users who click this label are taken to a page where they learn more about online advertising and the ads they've seen. Giving users clear notice about the ads they see is a high priority for Google and for many in the online advertising industry at large.

We'll soon start to change our in-ads notice icon to a new icon that expands to an "AdChoices" label. These notifications were developed by the online advertising industry’s Self-Regulatory Program for Online Behavioral Advertising to more proactively give users notice and choice about the ads they see. With the change from our "i" icon and "Ads by Google" label to these new notifications, we hope to show our support for this cross-industry initiative, and to increase our users' understanding about ad choices through adoption of an icon they'll see on ads across the web.



In a few weeks, we'll begin to show the new icon and label on most ad formats across the majority of English-language sites. Over time, we’ll expand the notice to ensure that all English-language publisher sites in the Google Display Network come within the Self-Regulatory Program (until then, these sites will show the existing “i” icon and “Ads by Google” label). This will be the single most widespread rollout of the "AdChoices" label to date, and we're encouraged that others in the industry are similarly adopting it. We’re also looking at ways to increase transparency and control in other languages and countries. In the meantime, those languages and countries will continue to see the “i” and “Ads by Google” notice.

Just like before, users who click on the "AdChoices" label will be taken to a page where they can learn more about online advertising and the ads they've just seen. This page will also provide a link to the Ads Preferences Manager, where users can control the types of interest-based ads they see. Our tests of this new icon and label showed that they should not have any effect on ad performance. We think this rollout will help users better understand the ads they're seeing, and we look forward to seeing widespread adoption of this label throughout the industry.

Posted by Katrina Kurnit - Inside AdSense Team

Sensex gains 84 points on firm Asian cues

MUMBAI: The Bombay Stock Exchange benchmark sensex gained over 84 points in opening trade on Tuesday, snapping a four-session losing streak on the back of a fresh spell of buying in oil and gas, metals and banking stocks amid a firming trend on other Asian bourses.

The 30-share index of the Bombay Stock Exchange, which has lost over 228 points in the previous four sessions, recovered by 84.37 points, or 0.45 per cent, to 18,350.40 in the first few minutes of trade, with select blue-chips leading the recovery.

The wide-based National Stock Exchange Nifty index regained the 5,500 points level by rising 27.20 points, or 0.46 per cent, to 5,510.00.

Brokers attributed the rise in select stocks to fresh buying by funds and retail investors, driven by a firming trend on other Asian bourses.

Japan's Nikkei index was trading 0.16 per cent higher, while Hong Kong's Hang Seng Index rose 0.27 per cent in early trade on Tuesday. The US Dow Jones Industrial Averaged ended 0.01 per cent higher in yesterday's trade.

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Inflation rises to over 9%, RBI may hike interest rates again

NEW DELHI: Driven by rising prices of fruits, milk, petrol and manufactured goods, headline inflation surged past the 9 per cent mark in May, raising the expectations of another hike in key policy rates by the Reserve Bank of India later this week.

Inflation rose to 9.06 per cent in May from 8.66 per cent in April, prompting Prime Minister's Economic Advisory Council (PMEAC) Chairman C Rangarajan to describe the trend as "upsetting" and pitch for tightening of the monetary policy by the RBI to cool rising prices.

The central bank, which has raised key interest rates nine times since March, 2010, to check rising prices, is slated to conduct a mid-quarterly review of the monetary policy on Thursday. The RBI would try to balance the need to tame inflation and promote industrial growth, which has slipped to 6.3 per cent in April from 13.1 per cent a year ago.

"I think the inflation numbers are in a sense upsetting... We need to address the issue of inflation even more strongly. We need to use more monetary and fiscal policy to contain inflation," C Rangarajan told reporters here.

According to Wholesale Price Index (WPI) data released by the government today, several essential items, including rice, fruits, petrol, edible oils, cotton textiles and iron and steel products, became more expensive during May in comparison to April.

Inflation, according to Planning Commission Deputy Chairman Montek Singh Ahluwalia, "is a problem (but) we still remain hopeful... It has gone up, which is not unexpected, because the preliminary indications said it would go up."


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Sebi mulls demat, IPO norm recast

MUMBAI: In a bid to ensure greater participation of retail investors in the stock market, Sebi is planning a series of changes to the existing demat, IPO and secondary market trading rules. These changes will not only make the stock market a safer place but also streamline the entire process of investing, Sebi chairman U K Sinha told TOI in an interview. Separate committees have been set up to work on these initiatives, he added.

"We have been able to identify a number of irritants (for investors). And we will spend the next few months removing them," Sinha said. However , he added, the changes being planned will in no way be at the cost of diluting the antimoney laundering rules and the policies of Financial Action Task Force (FATF), an international body that helps in combating terror financing.

Sebi also plans to overhaul the 'Know Your Client' (KYC) process to make it simpler for investors and modify IPO forms. The KYC process identifies each investor and helps the regulator and other market intermediaries track down transactions from start to completion. Sinha underlined the need for streamlining the KYC procedure as various market-related agencies have different standards which often duplicate work and inconvenience investors. "The next thing we are going to do is to have not only a uniform standard but a common and inter-operable KYC," Sinha said. Which means if an investor has fulfilled his KYC requirements at any of the Sebi-authorized places, that will be valid at all points of the market, like depository , mutual fund, brokers, etc.

"The new regime will be 100% compliant with Prevention of Money Laundering Act (PMLA) and with FATF, of which India is a full member . The idea is to make it standardized but simple," he said. A public sector body or companies from the private sector may be roped in to provide this standardized service , he added.

The regulator is also working to simplify the demat account opening process. Currently, while opening a demat account, an investor has to fill in a booklet which is over 50 pages and has to sign more than 50 times.

"We are working to simplify the form," Sinha said. Besides , Sebi also believes that IPO documents and the information given to investors in the form of disclosures are voluminous and they do not communicate anything significant . "Investors usually want to know at what price an IPO is offered and compare it to its peers, what multiple is it as per its known earnings, and at the same time what is the sectoral ratio, etc." Sinha believes such useful information is either not provided or is lost in the voluminous offer documents.

Sebi has also found that often investors would like to know about the track record of merchant bankers who bring an issue to the market. Such information seems to be necessary for ordinary investors and hence would be made available to retail investors once the IPO rules are changed. "These are much more important information than the 150-200 pages of information that we are giving ," the Sebi chairman said. "We have set up a group and I'm hopeful that very soon we will be able to modify these forms. The idea is to provide relevant information and disclosure to the investor in a manner that he can understand ," he added.

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Sensex ends flat; down 3 pts on inflation worries, global cues

MUMBAI: The BSE benchmark Sensex closed almost flat on Monday, losing over three points at 18,266.03, as heavy-weights like Reliance Industries (RIL) and country's largest lender State Bank of India (SBI) came under selling pressure amid high inflation and weak global cues.

Carrying forward its losses into the fourth day, the Bombay Stock Exchange's Sensex eased by 2.51 points as RIL, the topper among the 30-scrip index, tumbled 1.84% on reports of oil sector regulator rejecting three new gas finds by the Mukesh Ambani-led company in KDG-6 fields.

Broad-based National Stock Exchange index Nifty also eased by three points to 5,482.80 on inflationary concerns as rising commodity prices indicated a possibility of another hike in interest rate.

Food inflation in May-end, which shot up to a two-month high, has increased pressure on the RBI to raise interest rates in its policy meeting on June 16. If the central bank were to rise rates, it will be for the 10th time in last 15 months.

RIL, largest lender SBI, country's biggest software exporter TCS, Tata Steel, Hindalco, Tata Motors and Maruti Suzuki were among the major losers on Sensex. However, gains by Infosys Technologies cushioned the market from any major fall.

Infosys, the Sensex most valuable stock after RIL, rose by 0.56% to Rs 2,877.55 while infrastructure major Larsen and Toubro gained 0.84% to Rs 1,707.90 a piece.

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World stocks hit 12-week low on growth jitters

LONDON: World stocks fell to a 12-week low on Monday as Chinese data highlighted concerns about weaker global growth momentum, prompting investors to unwind positions in higher-risk assets and buy government bonds.

The euro was a touch lower, weighed down by the lack of progress on how to get commercial banks involved in a second bailout for Greece.

Chinese stocks ended at a 4-1/2 month low, hit by worries about the impact of monetary policy tightening in an economy which is a key driver of world growth.

China's money growth slowed to a 30-month low in May and banks extended fewer new loans than expected, while exports to the United States and EU hit their weakest since late 2009.

Uncertainty over future U.S. monetary policy after the Federal Reserve's $600-billion bond buying programme ends this month also added to investor aversion to taking on more riskier assets, especially going into the thinner summer months.

"The bears are very much out in force across equity markets and with more downbeat economic data expected in the days ahead, it seems that they may retain the upper hand for some time yet," IG Markets dealer Terry Pratt said. The MSCI world equity index fell 0.2 percent to its weakest since mid-March. The index has lost nearly 8 percent since hitting a three-year peak in late April and is very close to erasing all of its 2011 gains.

The FTSEurofirst 300 index was broadly steady while emerging stocks lost a third of a percent.

The euro eased just 0.1 percent to $1.4336 against the dollar and fell towards record lows versus the Swiss franc, but remains supported by expectations that the European Central Bank will raise interest rates in July.

The key risk remains the effect of any kind of restructuring or reprofiling of Greek debt.

There were signs over the weekend that German and French banks were leaning towards contributing to a Greek rescue, but it remained unclear how they could do so without triggering a default or credit default swap contracts.

That issue has pitted the ECB against Germany, which has proposed a bond swap, and a raft of other EU political decisionmakers.

"What the euro needs is a resolution to the Greek crisis and the politicians and the central bankers do not appear to be close to finding one," said Kit Juckes, currency strategist at Societe Generale.

"That uncertainty is weighing on the euro and I expect it to be stuck in a $1.40-$1.47 range."

US crude oil fell 0.4 per cent to $98.92 a barrel. Saudi Arabia will raise output to 10 million barrels per day (bpd) in July, Saudi newspaper al-Hayat reported on Friday, as Riyadh goes it alone in pumping more outside official OPEC policy, aiming to place additional supplies among Asian buyers.

The bund futures rose 17 ticks. The dollar was steady against a basket of major currencies

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Sensex starts on quiet note

MUMBAI: Sensex started trade on a quiet note with a benchmark index on Thursday flat in opening trade and broader indices nudging up.

The 30-scrip sensitive index (Sensex) of the Bombay Stock Exchange (BSE), which opened at 18,394.57 points, was ruling at 18,412.21 points -- up 17.92 points or 0.1 percent from its previous close at 18,394.29 points.

The 50-scrip S&P CNX Nifty of the National Stock Exchange was also trading lacklustre at 5,533.05 points, up 0.13%.

Broader markets were ruling moderately up with the BSE midcap index rising 0.3% and the BSE smallcap index up 0.25%.

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IMF chief's selection on merit: Lipsky

BEIJING: Acting IMF managing director John Lipsky said he was confident that selection of the fund's next chief would be based on merit, as French finance minister Christine Lagarde made her case in China.

The goal of the selection process is "to be open -- open means open to everyone -- transparent, and merit-based. We are confident that that will be the result of this process," Lipsky told a news conference on Thursday.

Lipsky, in Beijing for the International Monetary Fund's annual policy talks on the Chinese economy, also said it was "a complete coincidence" that his visit was at the same time as Lagarde, a frontrunner to lead the global lender.

Lagarde, in the Chinese capital to drum up support for her IMF bid, said on Thursday that she felt "very positive" about her talks in Beijing, and backed China's right to fill a top job at the Washington-based fund.

Lipsky said he was "highly confident that our membership will choose a leader who is talented, experienced, energetic and effective".

On China's economy, Lipsky said the country continued to be a "bright spot" for global growth and the IMF maintained its forecast for the world's second-largest economy to grow around 9.5 percent this year and next.

He also expects inflation, which has been hovering above five percent, to ease to around four percent by the end of 2011.

But Lipsky warned China faced financial risks from a massive credit binge in recent years, increased off-balance sheet lending -- apparently referring to a surge in local government debt -- and soaring property prices.

A rebalancing of China's export-dependent economy was critical for the stability and growth of the world economy, and a stronger and more flexible yuan was "absolutely part of that", he said.

Lipsky added that the yuan needed to become more freely convertible and more widely used for it to be included in the basket of currencies that determine the value of the IMF's Special Drawing Rights, an international reserve asset.

"It is certainly agreed that over time, the yuan is likely to become a candidate for inclusion in the SDR basket," he said.

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Govt open to more fuel subsidy: Pranab

NEW DELHI: Finance minister Pranab Mukherjee on Tuesday suggested that the government was open to increasing the fuel subsidy beyond the budgeted level, if needed.

The statement made during an interaction with over 30 institutional investors is likely to provide comfort to oil marketing companies which are saddled with mounting losses due to their inability to align the retail prices of diesel, cooking gas and kerosene oil to global prices. Even the fuel buyer can draw breathe a little easy as the pending hikes might not be as sharp as expected.

Though this does raise questions over the government's ability to meet the annual fiscal deficit target of 4.6% of GDP, Mukherjee tried to allay investor fears saying that despite the increased liability the government would be able to stick to its estimate.

Rising global crude oil prices have fuelled expectations that the government's fuel subsidy bill may mount. Oil marketing firms have raised prices of petrol by Rs 5 a litre and there has been talk of an increase in diesel and cooking gas prices to reduce the losses of state-run oil firms.

While a ministerial panel was scheduled to meet this week to discuss ways to reduce the burden on oil marketing companies, which are selling subsidised diesel and cooking fuel with no government support, the deliberations have been postponed. The move comes as international crude prices are off their recent highs.

Oil companies are losing nearly Rs 18 on every litre of diesel that they sell, while the loss on selling cooking gas is over Rs 300 a cylinder. Although a duty cut is virtually ruled out, oil marketing companies are expected to be allowed to increase retail prices marginally and the government might have to bear a higher subsidy burden to cushion what were the most profitable companies in the country until the policy flip flop on oil subsidy emerged during UPA rule.

Mukherjee told a group of more than 30 leading Indian and foreign institutional investors that the government was committed to reducing the fiscal deficit to the targeted 4.6% of gross domestic product. The fiscal deficit is the gap between the government's revenues and spending. He said the provisional data for 2010-11 which pegged the fiscal deficit at 4.7% of GDP, lower than the estimated 5.1%, had stirred hopes that the government would be able to meet its target set for the current fiscal year which ends in March 2012.

The finance minister also sought to convey a message that the government remained committed to further liberalisation and said consultations were on with regard to further opening up the insurance and retail sectors to greater foreign participation and the centre would make all efforts to build a consensus on these issues. An inter-ministerial group had recently recommended opening up the closely policed multi-brand retail sector to foreign companies as an inflation busting measure.

The veteran Congress leader also assured the investors that inflation was likely to moderate in the months ahead on the back of good monsoon rains which is expected to raise the economic prosperity of farmers. Stubbornly high inflation has emerged as a key policy challenge for the government and the central bank. The Reserve bank of India has raised interest rates nine times since March 2010 to tame inflation.

Mukherjee said it would be premature to judge the success of the disinvestment programme based on only two months of the current financial year and said the centre was committed to pursuing its divestment programme. He said the public issue of the Power Finance Corporation had helped raise Rs 1,145 crore. He said the government did not pursue the share sale programme in the previous financial year as it had received higher than expected revenues from the sale of 3G spectrum.

Volatile stock markets and the global economic situation had fuelled speculation that the government may not be able to meet its target of raising Rs 40,000 crore from share sales in the 2011-12 financial year. The government has plans to sell stakes in several blue-chip state run firms such as BHEL, SAIL and others.

Mukherjee assured the investors that the India growth story was intact and growth would be around 8.5% in the current financial year and there would be no decline in revenue receipts.He said there should not be any undue fear over the fiscal deficit. Economists expect growth to moderate in 2011-12 due to the impact of the aggressive interest rate increases and say growth could be around 8%.

TOI

Sensex down 95 points on profit-booking, weak Asian cues

MUMBAI: The BSE benchmark sensex opened over 95 points lower on Wednesday as speculators booked profits made after two sessions of gains amid a weakening trend on other Asian bourses.

The 30-share barometer, which gained nearly 120 points in the previous two sessions, fell by 95.18 points, or 0.51%, to 18,400.44, with FMCG, banking, IT and capital goods stocks leading the decline.

Similarly, the wide-based National Stock Exchange Nifty index moved down by 29.65 points, or 0.53%, to 5,526.50 points.

According to market experts, the fall in stock prices was mostly due to the emergence of profit-booking following two sessions of gains, besides the absence of positive cues.

In addition, a subdued trend on other Asian bourses following overnight losses in the US market dampened the market sentiment at home.

In Asia, Hong Kong's Hang Seng index shed 0.93% and Japan's Nikkei was trading 0.32% down this morning. In the US, the Dow Jones Industrial Average ended 0.16% lower in yesterday's trade.

TOI

Rupee opens 8 paise lower against US dollar

MUMBAI: The Indian rupee depreciated by 8 paise to Rs 44.92 against the US dollar in early trade on the Interbank Foreign Exchange on Thursday, tracking dollar gains against other currencies overseas and a weak trend in the equity market.

Forex dealers said the dollar's strength against major currencies overseas and a weak start in the stock market mainly put pressure on the rupee.

The rupee strengthened by 22 paise to close at Rs 44.84/85 against the US currency in yesterday's trade on the back of firm equities amid heavy selling of the American currency.

Meanwhile, the Bombay Stock Exchange benchmark Sensex fell by 192.27 points, or 1.03%, to 18,416.54 in opening trade today.

Sensex slumps 192 points in opening trade on weak global cues

MUMBAI: The BSE benchmark Sensex fell sharply by over 192 points in opening trade on Thursday as foreign funds and retail investors booked profits made during the previous two sessions, taking cues from weak global markets.

Profit-booking by speculators after two sessions of gains also dragged the Sensex down.

The 30-share barometer, which gained over 376 points in the previous two sessions, fell by 192.27 points, or 1.03%, to 18,416.54 in the first few minutes of trade on Thursday.

Stocks of banking, realty, metals and auto companies suffered the most in the fresh sell-off.

Similarly, the wide-based National Stock Exchange Nifty index slid by 60.10 points, or 1.07%, to 5,531.90.

Market experts said the trading sentiment was bearish amid a subdued trend on global markets following weak US economic data.

In addition, the cautious approach adopted by investors ahead of the release of food inflation data later today also dampened the sentiment, they said.

In the Asian region, Hong Kong's Hang Seng index was trading 1.69% lower and Japan's Nikkei shed 1.64% this morning. In the US, the Dow Jones Industrial Average ended 2.22% lower in Wednesday's trade.

toi

Diesel demand spikes ahead of price hike

NEW DELHI: The rate of growth in diesel demand spiked to 14%-15% in May from a mere 1.7% in April as vehicle owners tanked up with the government taking time to revise its price, early sales trend for the month available with state-run oil companies show.


A senior marketing executive of IndianOil Corporation, which controls nearly half of the fuel retail market, said even after petrol price was raised by Rs 5 a litre, demand for the fuel has shown a growth rate of 9%. In April, or before the price revision, demand had grown at 7.4%.


Cumulatively, overall demand for all petroproducts in May stood at 6%, or nearly double the 3.9% seen in April. In 2010-11, overall petroproducts demand grew at 4.2%, whereas petrol registered a growth of 10.8% and diesel 6%. "This paints a stark picture for diesel. It also shows that price increase does not affect demand," the IndianOil executive said, requesting anonymity.


One dealer in Delhi said even those who normally buy fuel for Rs 500 or Rs 1,000 at a time are tanking up, including diesel vehicle owners. "Even normally you find long queues at petrol pumps on the eve of price hikes announced by TV channels. This time the period has got longer."


"Think of transporters and other commercial establishments, in addition to private vehicle owners, who are tanking up and you have a huge inventory building up in private domain. Thruputs of our storage depots have increased and oil companies' infrastructure is being stretched," the IOC executive said.


After the petrol price hike, the government said it would decide on raising diesel price by up to Rs 4 a litre and cooking gas price by Rs 25-50 per refill. The government keeps prices of these fuels artificially low and pays state-run oil marketing firms money to make up their retail losses.


Diesel price was revised almost a year ago. The present pump price corresponds to roughly $70 a barrel of crude, which averaged $109 in the second fortnight of May, down from $112 in the preceding fortnight. Concerned over diesel price hike fuelling inflation and pushing up farming costs, the government is taking its time to see if crude falls further. This will help it to keep the increase at a minimum.


Industry figures, however, show government's concerns could be misplaced. Only 10% or so of the 45 million tonnes of the fuel is consumed by the farm sector and 30-35% is used for goods movement. Large volumes go to railways and state transport utilities, while the remaining is used by private vehicles and commercial establishments. "Except the farm and goods movement, none of the consumers are linked to price index. Why should they enjoy subsidy," the executive said.

toi

Rupee gains 10 paise against US dollar in early trade

MUMBAI: The Indian rupee appreciated by 10 paise to Rs 44.98 per dollar in opening trade on the Interbank Foreign Exchange on Tuesday, supported by dollar weakness against the euro and other Asian currencies and a higher opening in the stock market.

The rupee had strengthened by 8 paise to close at Rs 45.08/09 against the US currency in yesterday's trade amid sustained dollar selling and renewed capital inflows.

Forex dealers said dollar weakness against the euro and other Asian currencies overseas and a better start in the stock market kept the rupee sentiment firm against the American dollar.

Meanwhile, the Bombay Stock Exchange Sensex was up by 104.58 points, or 0.57 per cent, at 18,336.65 in opening trade today.

toi

Sensex starts trade on firm note

MUMBAI: A benchmark index for Indian equities markets on Tuesday rose in early trade with healthy buying seen in healthcare and banking scrips.

The 30-scrip sensitive index ( Sensex) of the Bombay Stock Exchange (BSE) which opened at 18,266.61 points, was ruling at 18,321.08 points, up 89.02 points or 0.49 percent from its previous close at 18,232.06 points.

The 50-scrip S&P CNX Nifty of the National Stock Exchange was also trading higher at 5,498.25 points, up 0.46 percent.

Broader markets too were ruling in the green with the BSE midcap index ruling 0.38 percent up and the BSE smallcap index up 0.33 percent.

toi

Rupee gains 10 paise against US dollar in early trade

MUMBAI: The Indian rupee appreciated by 10 paise to Rs 45.20 per dollar at the Interbank Foreign Exchange today, supported by a higher opening in the stock market and dollar weakness against the euro and other Asian currencies.

The rupee had gained 2 paise to close at Rs 45.30/31 against the US currency in yesterday's trade on the back of a recovery in equities amid dollar weakness overseas.

Forex dealers said dollar weakness against the euro and other Asian currencies overseas and a higher opening in the stock market kept the rupee sentiment firm.

Meanwhile, the Bombay Stock Exchange Sensex was up by 163.56 points, or 0.91%, at 18,208.20 in opening trade on Friday.

toi

Sensex advances further by 142 points on higher Asian cues

MUMBAI: The BSE benchmark sensex advanced further by 142 points in early trade today on persistent buying by investors in realty, oil and gas, banking and metal stocks on the back of higher Asian cues.

The BSE benchmark sensex resumed higher at 18,105.61 and hovered in a range between 18,224.18 and 18,087.16 before quoting at 18,186.69 at 1015 hours, showing a net gain of 142.05 points, or 0.79%, from its last close.

The NSE's 50-share Nifty index also rose by 37.20 points, or 0.69%, to 5,449.55 at 1015 hours.

Index heavyweight Reliance Industries ( RIL) nudged higher in early trade today, while banking stocks gained for the second straight day. The market breadth was strong.

Reliance Infrastructure (R-Infra) and Reliance Power (RPower) rose ahead of their Q4 results due today.

Among the major gainers from the Sensex pack, Hindalco Industries firmed up by 3.43 per cent, ICICI Bank by 2.48 per cent, Jaiprakash Associates by 2.45 per cent, R-Infra by 1.96 per cent, M&M by 1.81 per cent, DLF by 1.71 per cent, Reliance by 1.16 per cent and RCom by 1.68 per cent.

Most Asian stocks rose yesterday, tracking overnight gains in US stocks. The key benchmark indices in Hong Kong, Indonesia, Singapore, South Korea and Taiwan rose by between 0.05% and 0.74%. However, the key benchmark indices in China and Japan fell by between 0.04% and 0.1%.

Trading in US index futures indicated that the Dow could gain 20 points at the opening bell.

toi

DLF gets Rs 1,700 crore tax notice

NEW DELHI: Realty major DLF has said income tax authorities have slapped additional tax notices for over Rs 1,700 crore pertaining to 2008-09 assessment year after being disallowed its profits in SEZ projects. The company said it is challenging the orders with appropriate authorities and hopes that these demand notices will be revoked. SEZs enjoy tax benefits.

"Subsequent to the quarter ended March 31, 2011, the company received an assessment order for AY 2008-09 from the Income Tax Authorities, creating an additional demand of Rs 546.85 crore.

"Out of this Rs 487.23 crore pertains to demand on account of disallowance of SEZ profit under section 80IAB of Income Tax Act," DLF said in a note in its annual result.

"During the year, the group had also received similar demands on account of disallowance of SEZ profits in two of its subsidiaries totalling Rs 1,156.19 crore," it added. Without naming the units, DLF said those firms are challenging the orders.

toi

Pepsi, Hero Honda win WC brand war

MUMBAI: Even as we await the verdict on the brand battle being fought around the Indian Premier League (IPL-4), cola major Pepsi and two-wheeler maker Hero Honda have emerged as the two sponsors with the highest consumer recall during the cricket World Cup.

According to a brand effectiveness survey conducted by the country's largest media agency, Mindshare, a part of the WPP group, besides these two brands, real estate player DLF was also recalled as one of the sponsors of the tournament despite being associated with the IPL and not the World Cup.

The survey, released recently and shared exclusively with TOI, had a sample size of 2,500 respondents across ten cities and was aimed at understanding the consumer's brand awareness during the ongoing chock-a-block cricket season.

When asked as to which brand was associated with cricket, the answer was Pepsi again with nearly 40% votes while the next brand stood at 10%. The same impact was registered when asked about the advertising association. PepsiCo launched an advertising campaign "Change the game" to capture and celebrate the changes in cricket over the years with a 360 degree marketing activity right before the World Cup.

According to the survey 61% of the respondents said they had watched the entire match from start to finish during the course of the World Cup which ran from February 19 till April 2, 2011.

"Our objective was to assess the movement in brand relationships with cricket over a period of 100 days which included two heavyweight events, World Cup and the IPL that took place back to back-a rare sequence till 2015. This is an ongoing research and it will be interesting to know how these associations change during the course of IPL" said R Gowthaman, leader, South-Asia, Mindshare.

As far as the IPL goes, the survey said that the fourth edition of the Twenty20 tournament will have more audiences in the stadium compared to the last edition with respondents from cities like Bangalore, Jaipur, Kochi and Mohali being most inclined to watching the matches in the stadium. On the television viewership front, 82% of the participants said their viewership habits will be impacted during the course of the IPL.

Mumbai Indians were the most popular team outside their home city while the Kochi team, which was included in the IPL this year, had instant loyalty said the survey findings. Sachin Tendulkar, not surprisingly, emerged as a clear number one when respondents were asked to pick their favourite players, while the India skipper MS Dhoni who also captains Chennai Super Kings was next in line. Yuvraj Singh, who moved to the Pune team from Kings X1 Punjab this year still enjoys a strong support base in the Chandigarh/Mohali area said the survey.

"It is quite evident that top of the mind awareness will sustain for a longer period for big brands for more than the duration of the tournament because of the high level of involvement with the match," Gowathaman added.

TOI

Rupee off 2-month low on strong shrs, stable euro

MUMBAI: The Rupee pulled back on Tuesday from the two-month low touched in the previous session comforted by positive local shares and absence of any further big fall in the euro.

At 9:21 am, the partially convertible rupee was at 45.14/15 per dollar against 45.23/24 at close on Monday, when it had dipped to 45.3225, a level not seen since March 15.

The euro was at $1.4059 and the index of the dollar against six major currencies was at 76.102 points. On Monday, when the local market closed the euro was at $1.4017 and the dollar index at 76.231 points.

But month-end payments by domestic oil refiners, the biggest purchasers of dollars in the local forex market, could be key for the rupee's direction and is likely to prevent a sharp recovery, traders said.

Indian shares climbed more than 0.3 percent early on Tuesday tracking gains in Asian peers and helped by lower oil prices that could provide some relief to offset negative sentiment.

TOI

Sensex regains 18k level, up 113 points

MUMBAI: The BSE benchmark Sensex regained the 18,000 points level in opening trade on Tuesday, shooting up by over 113 points on a fresh spell of buying by funds and retail investors, taking cues from the firming trend on other Asian bourses.

The 30-share index of the Bombay Stock Exchange, which lost 332.76 points in the previous session, recovered by 113.45 points, or 0.63 per cent, to 18,106.78 in the first few minutes of trade, with oil and gas, auto, banking, realty and consumer durable stocks leading the recovery.

Similarly, the wide-based National Stock Exchange Nifty index also moved up by 28.50 points, or 0.53 per cent, to 5,415.05.

Brokers attributed the recovery in stocks to fresh buying by funds and retail investors, driven by a firming trend on other Asian bourses.

TOI

Investors lose big money in 9 of 12 IPOs this year

MUMBAI: The current weak market conditions have taken a heavy toll on investors of initial public offering (IPO). Of the 12 IPOs that closed this year and have been listed, investors of only three are still in the black. The combined loss to investors in the nine loss-making public offers is over Rs 2,100 crore, or nearly 19%, data from NSE and BSE showed. In the three IPOs in which investors have made money, the combined gain is about Rs 433 crore.


So far in 2011, IPO investors have made money in three offerings-Midvalley Enetrtainment, Sudar Garments and Lovable Lingerie-in which appreciations have been 72%, 61% and 51% respectively. On the other hand, they have lost money in nine IPOs, including highly publicized ones like Muthoot Finance and Future Ventures, besides one from the PSU stable-PTC Financial Services. The biggest loss-making IPO so far in the year has been Acropetal Technologies, where the stock has lost 72% from its IPO price of Rs 90 to its current price of Rs 25, its all-time low. Incidentally, within two weeks after the stock was listed, it had peaked at Rs 156, but since then it has been on a downhill journey.

Market watchers said that of late, due to weak market conditions, while good companies are deferring their plans to go public, little-known companies are hitting the market. "Quality of the offerings is definitely an issue in these offerings," said an industry analyst. One indication about the quality of the offerings is that of the 12 IPOs which have been analysed for post-listing returns, none had the highest, that is 5 out of 5, IPO rating. Only two-PTC Financial Services and Muthoot Finance-had ratings of 4, while most had 2 or 3 ratings and three IPOs even had 1 out of 5 ratings, that is the lowest grade. These gradings are given credit rating agencies like Crisil, CARE and Icra.

Often investors come into these IPOs for listing gains and if they can not exit at the right time, they are stuck, market players said. They also warned investors from getting lured by the prospects of quick gains.

toi

Sensex up 112 points in opening trade

MUMBAI: The Bombay Stock Exchange benchmark Sensex recovered by over 112 points in opening trade on Thursday on fresh buying in metals, banking and oil and gas stocks, driven by a firming trend on other Asian bourses.

The 30-share barometer, which has lost nearly 445 points in the previous three sessions, rose by 112.25 points to 18,198.45 in the first few minutes of trade today.

In a similar manner, the wide-based National Stock Exchange Nifty index rose by 32 points to 5,452.60.

Brokers said the emergence of buying in heavy-weight stocks by funds as well as retail investors was triggered by a firming trend in other Asian markets following overnight gains in the US, which gave a boost to the trading sentiment.

In the Asian region, Hong Kong's Hang Seng index rose by 0.25 per cent, while Japan's Nikkei edged higher by 0.51 per cent in morning trade today. The US Dow Jones Industrial Average ended 0.65 per cent higher in yesterday's trade.

toi

Sensex opens 78 points higher on Asian cues

MUMBAI: The Bombay Stock Exchange benchmark Sensex recovered by over 78 points in opening trade on Wednesday on emergence of selective buying by funds and retail investors amid a firming trend on other Asian bourses.

The 30-share barometer, which has lost almost 394 points in the previous two sessions, recovered by 78.54 points, or 0.43 per cent, to 18,215.89 in opening trade, with stocks of the metals, capital goods, realty and banking sectors leading the recovery.

The wide-based National Stock Exchange index Nifty also moved up by 17.85 points, or 0.33 per cent, to 5,456.80.

Brokers said fresh buying by funds and investors at prevailing levels and a firming trend on other Asian bourses mainly helped the trading sentiment to improve, but rising interest rates remained a dampening factor.

Meanwhile, Hong Kong's Hang Seng Index rose by 0.03 per cent and Japan's Nikkei by 0.88 per cent in early trade on Wednesday. In the US, the Dow Jones Industrial Average ended 0.55 per cent lower in yesterday's mixed trade.

toi

Sensex gains 47 points in opening trade

MUMBAI: The Bombay Stock Exchange benchmark Sensex rose by nearly 47 points in opening trade today on bargain buying by funds and retail investors in select stocks available at attractive levels.

The 30-share barometer, which lost 186.25 points in yesterday's trade, recovered by 46.92 points, to 18,391.95 in the first few minutes of trade today.

Stocks of the healthcare, consumer durables, metals and banking sectors led the recovery.

In a similar manner, the wide-based National Stock Exchange Nifty index rose by 10.45 points to 5,509.45 points.

Brokers said selective bargain buying by funds and retail investors in stocks that are available at attractive levels helped the Sensex trade in the positive zone, but a weakening trend on other Asian bourses capped the gains.

In the Asian region, Hong Kong's Hang Seng index was down by 0.27%, while Japan's Nikkei shed 0.47% in morning trade today. The US Dow Jones Industrial Average ended 0.38% lower in yesterday's trade.

toi

April inflation at 8.66%, seen higher in months ahead

NEW DELHI: The country' widely watched wholesale prive index rose 8.66% in April, lower than the 9.04% in March but economists say inflation will creep up higher in the months ahead given the expected increase in diesel prices.

The worrying aspect of the data released on Monday was that the government revised the February inflation number to 9.54% from the previously reported 8.31%. Economists say this highlights the inflationary pressures in the economy and the impending increase in diesel prices will further add to the pressure.

Some economists say the WPI inflation is expected to hit double-digit by September. The Reserve Bank of India is widely expected to again raise interest rates in its June policy review. It has already said that it stands ready to sacrifice some growth to tame inflation.

On Saturday, oil firms raised petrol prices by Rs 5 per litre which is expected to upset household budgets.

toi

Sensex down 120 points in opening trade

MUMBAI: The BSE benchmark Sensex lost nearly 120 points in opening trade today on fresh selling by funds and retail investors amid a weak trend on other Asian bourses and a hike in petrol prices by state-run oil companies.

The 30-share barometer, which had gained 195.49 points in the previous session, fell by 119.88 points to 18,411.40 within the first few minutes of trade, with auto, banking, metals and realty sector stocks coming under pressure.

Similarly, the wide-based National Stock Exchange Nifty index declined by 35.15 points to 5,509.60 points.

Brokers attributed the downslide on the bourses to a fresh round of selling by funds and retail investors in tandem with a weakening trend on other Asian bourses and the biggest-ever hike in petrol prices of Rs 5 a litre by state-run oil companies.

toi

IMF chief New York court appearance postponed

NEW YORK: A New York court appearance by IMF chief Dominique Strauss-Kahn to face charges he sexually assaulted a hotel maid has been postponed until Monday so he can undergo an examination, his lawyers said on Sunday.

"Our client willingly consented to a scientific and forensic examination tonight ... at the request of the government and in light of the hour we have agreed to postpone the arraignment until tomorrow morning," lawyer William Taylor told reporters outside Manhattan Criminal Court .

"He's tired but he's fine," Taylor said when asked about Strauss-Kahn.

ET

Sensex drops 0.5 pc; Suzlon up nearly 4 pc

MUMBAI: Indian markets dropped 0.5 percent in early trade on Monday, taking cues from weak Asian peers.

Wind turbine maker Suzlon Energy rose nearly 4 percent to 55.25 rupees after the company on Saturday reported a fourth quarter net profit of 4.32 billion rupees compared with a loss of 1.88 billion in the year ago period.

State-run oil marketing companies Indian Oil , Bharat Petroleum and Hindustan Petroleum rose between 2.3 and 3.6 percent after they raised petrol prices by about 5 rupees a litre on Sunday.

At 9:17 a.m. (0347 GMT), the 30-share BSE index was down 0.55 percent at 18,430.70 points, with 24 components declining.

The 50-share NSE index was down 0.5 percent at 5,517.80 points.

ET

Sensex up 72 pts on delay in fuel price hike and global cues

MUMBAI: The Bombay Stock Exchange benchmark Sensex on Wednesday gained over 72 points to 18,585 as investors bought heavyweights in view of the government move to defer a meeting to raise fuel prices and a firm global trend.

The Sensex, which ended on a flat note in the past two sessions, moved up 72.19 points or 0.39 per cent to 18,584.96, as stocks of State Bank of India, Tata Motors, Tata Steel, Hero Honda and Infosys recorded smart gains.

Similarly, the broad-based National Stock Exchange index Nifty rose by 23.80 points or 0.43 per cent to 5,565.05.

Stocks of Ranbaxy, the largest drugmaker by revenue, surged 6.37 per cent to Rs 477.70 after reporting first quarter earnings yesterday that beat market estimates. The healthcare index rose by 0.51 per cent to 6,088.95.

Brokers said investor sentiment improved somewhat after yesterday's meeting to hike fuel prices was postponed.

The imminent hike has been weighing heavy on the stock markets, as investors fear that the move would stoke inflation, leading to a further rise in interest rates.

They said a mixed trend in the Asian region and higher openings in Europe helped the market.

Realty, metal, auto and consumer durables remained on the fore-front and drove up the market.

Tata Steel rose 0.73 per cent to Rs 593.35, and Sterlite Industries by 1.47 per cent to Rs 176.60.

Metal stocks gained on firming trend in the London Metal Exchange Index.

The most beaten realty sector index gained 1.40 per cent at 2,143.12, followed by metals index, up 1.01 per cent at 15,647.74. Auto sector index gained 0.95 per cent to 9,189.82 and consumer durables by 0.72 per cent to 6,201.43.

toi

Home loans 25% costlier in 2 yrs, SBI’s now at 10.25%

MUMBAI: A large number of home loan customers with floating rates are in for some tough times ahead, with major banks and housing finance companies (HFCs) raising mortgage rates.

Over the last two years, interest on home loans has gone up by at least 200 basis points (100 basis points = 1%), from about 8% to above 10% for even the best-rated customers. That is a hike of about 25%. In some cases, industry experts said, such hikes could well have taken the tenure of home loans to beyond 20 years. This in turn raises the possibility of banks and HFCs now asking some customers to partpay the principal amount of home loans.

On Tuesday, State Bank of India, the country's largest bank, raised both its deposit and lending rates, taking its effective home loan rate to 10.25%. Last week, ICICI Bank, the second largest bank, raised its rates. HDFC Bank and HDFC are both expected to follow soon.

After the latest round of rate hikes, SBI's home loan customers would pay 100 basis points (bps) above its base rate of 9.25%; thus the effective rate becomes 10.25%. "With the banking leader in double digits, others will have to be above this level," an official with an HFC said.

Now consider a situation where a 40-year-old home loan customer had taken a loan about 2-3 years ago. As rates go up, banks usually increase the number of EMIs, rather than the amount of the EMI. If in this case, the number of EMIs go beyond 240 (that is 12 EMIs for each of 20 years), the customer will have to continue paying beyond his retirement age. In such a situation, the bank or the HFC, would "call and counsel" the customer and give him two options: Either increase the EMI so that the its number comes down to below 240, or pay a lumpsum which would reduce the borrower's outstanding principal amount and leave the EMI amount unchanged. "Increasing the EMI is best option, but at times, looking at the customer's financial position, we ask for some one-time part-payment of principal," official at a housing finance company said.

A back of the envelope calculation shows that home loan rates have increased by about 25% over the last few years, that is from about 8% to above 10% now.

On Tuesday, in addition to raising its base rate by 75 basis points to 9.25%, SBI also raised its fixed deposit rates by as much as 225 basis points (100 basis points=1%), all of which were in maturities of up to six months. The bank also raised its prime lending rate (PLR) by 75 bps to 14% now. All these hikes are effective Thursday.

The hike in FD rates is sure to cheer those who prefer the safety of bank FDs. From May 12, SBI will pay at the rate of 6.25%.

Rupee gains 7 paise against US dollar in early trade

MUMBAI: The Indian Rupee appreciated by 7 paise to Rs 44.67 per dollar at the Interbank Foreign Exchange today, supported by a higher opening in the stock market and dollar weakness against the euro and other Asian currencies.

The rupee had depreciated by 2 paise to close at Rs 44.74/75 against the US currency in yesterday's trade due to dollar demand from banks and importers in view of a firm trend overseas.

Forex dealers said dollar weakness against the euro and other Asian currencies overseas and a higher opening in the stock market helped the rupee gain some ground against the American dollar.

Meanwhile, the Bombay Stock Exchange Sensex was up by 62.23 points, or 0.33%, at 18,575.00 in opening trade today.

TOI

Sensex gains 62 points in opening trade on firm Asian cues

MUMBAI: The BSE benchmark Sensex opened over 62 points higher today on selective buying by funds and retail investors, taking cues from a firming trend on other Asian bourses after yesterday's losses.

The 30-share index of the Bombay Stock Exchange, which lost 16.19 points in the previous volatile session, recovered by 62.23 points, or 0.33%, to 18,575.00 in the first few minutes of trade today, with auto, metals, banking and realty stocks leading the recovery.

Similarly, the wide-based National Stock Exchange Nifty index also moved up by 15.60 points, or 0.28%, to 5,556.85.

Brokers attributed the rise in select stocks to fresh buying by funds and retail investors, driven by a firming trend on other Asian bourses following overnight gains in the US market.

Japan's Nikkei index was trading 0.65% higher, while Hong Kong's Hang Seng Index gained 0.28% in early trade today. The US Dow Jones Industrial Averaged ended 0.60% higher in yesterday's trade.

TOI

Gold prices in India slip despite heavy buying on Akshaya Tritiya; oil falls by $5

NEW DELHI: Even as buying activity remained high on the auspicious day of 'Akshaya Tritiya', both the precious metals tumbled today on weak global cues. Silver nose-dived by Rs 6,000 to Rs 53,200 per kg and gold plummeted by Rs 225 to Rs 22,120 per 10 grams.

Retail customers resorted to active gold buying to mark the day of Akshaya Triitya, considered to be an auspicious occasion in Hindu mythology to make token purchases.

Traders said the demand among retailers for the festival had hardly any impact of the sliding precious metals prices despite the ongoing weakening trend in domestic as well as overseas markets.

"The weakening trend has hardly impacted retailers activity as they are dedicatedly making token buying in gold on every fall in the market," said Suresh Verma, a Delhi-based jeweller.

"At least the buying has capped any major fall in gold prices, while silver remained unattended, losing substantial ground," he said.

Trading sentiments remained weak in silver as its prices recorded a steepest weekly fall since 1975 in global markets after impositions of higher margins. Gold also had its biggest weekly drop since February 27, 2009.

Silver in global markets, which normally sets a price trend on the domestic front, fell 12.01 per cent to USD 34.66 an ounce, taking losses to 28 per cent this week and gold by USD 43.40 to USD 1,473.10 an ounce in New York.

The Standard and Poor's GSCI index of 24 commodities sank 6.5 per cent on concern that slower global growth may crimp demand and investors sold to book-profits and shift their funds to surging equity markets.

On the domestic front, silver ready nose-dived by Rs 6,000 to Rs 53,200 per kg and weekly-based delivery by Rs 5,900 to Rs 53,100 per kg. Silver coins lost Rs 4,000 to Rs 59,500 for buying and Rs 60,500 for selling of 100 pieces.

In line with a general weakening trend, gold of 99.9 and 99.5 per cent purity plunged by Rs 225 each to Rs 22,120 and Rs 22,000 per 10 grams, respectively.

However, sovereigns, found scattered buying support from retailers and gained Rs 100 to Rs 18,300 per piece of eight grams.

Oil prices also fell 5 percent on Friday, after a 10 percent crash on Thursday, as fears about global economic recovery pushed investors to further unwind commodities positions.

Brent crude shed just over $5, recovering to trade at $107.16, $3.64 down, at 0848 GMT

Brent settled more than $10 lower on Thursday at $110.80 a barrel, the second biggest drop on record. At one point it gave up $12, its biggest fall ever.

US crude futures were $3.62 lower at $96.20 a barrel, up from as low as $95.25 a barrel earlier in the session.

The fall on Thursday was part a global dive over all commodities, driven by factors including a stronger dollar and weak economic data from Europe and the United States.

Goldman Sachs said it saw a further downside risk for oil prices in coming days but added the prices could return to or surpass recent highs by next year as supplies may reach critically tight levels.

"It is important to emphasize that even as oil prices are pulling back from their recent highs, we expect them to return to or surpass the recent highs by next year," Goldman Sachs' analysts said in a research note.

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Sensex snaps 9-session losing streak, up 225 points

MUMBAI: The BSE benchmark Sensex snapped its nine-session losing streak by gaining 225 points in early trade on Friday on renewed buying on easing of macroeconomic worries in view of a sharp fall in crude oil prices.

Bargain hunting emerged after the last nine days losing streak. The market breadth was strong. PSU OMCs rose as crude oil prices slumped.

Crude oil prices slumped the most in the early trade falling below USD 100 a barrel.

Among the 30-member Sensex pack, 21 stocks, advanced while the rest declined. ICICI Bank, Tata Motors and TCS rose by between 1.48% to 2.99%.

India's state-run Oil & Natural Gas Corp gained 1.25% on reports company will launch a follow-on public offering on July 5, 2011.

HPCL, Indian Oil Corporation and BPCL rose by between 1.6% to 2.35%.

The BSE benchmark Sensex resumed higher at 18,289.78 and shot up further to 18,480.93 before quoting at 18,435.63 at 1015 hours, showing a net gain of 225.05 points, or 1.24%.

The NSE 50-share Nifty also moved up by 57.65 points, or 1.06%, to 5,517.50 from its last close.

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Sensex loses 1,400 pts in nine sessions

MUMBAI: A statement by the CBI counsel in the Supreme Court, which is hearing the 2G telecom spectrum allocation scam around Thursday noon, unnerved the stock market and led to a 1.4% slide in the sensex, its ninth consecutive session of losses and the longest such stint in a decade.

K K Venugopal, the CBI lawyer, said the agency could seek further details from business tycoons Ratan Tata and Anil Ambani. The statement triggered further jitters among investors on Dalal Street, leading to panic selling in the second half of the session with the sensex finally settling at 18,211, down 259 points. Over the last nine sessions, the sensex has lost nearly 1,400 points, or 7.1% while investors wealth, measured in terms of BSE's market cap, is down by about Rs 4.30 lakh crore to Rs 66 lakh crore now.

The slide was again prompted by foreign fund selling, with real estate, software and FMCG stocks leading the laggards. BSE data showed that FIIs were net sellers at Rs 780 crore, taking the current month's net outflow figure to about Rs 3,200 crore ($700 million). Institutional dealers said most of this selling is coming from exchange traded funds of European origin which invest here through the FII route.

The main reasons for foreign fund selling are rising inflation, which is leading to higher interest rate, increasing crude prices, which could force the government's fiscal calculations to go haywire and expectations of moderation in growth rates, dealers said. On Thursday, the CBI counsel's statement led to a 5.5% slide in RCOM, which closed at Rs 89. Among other companies allegedly involved in the 2G scam, Unitech lost 3.4% to Rs 35 while DB Realty closed 3.3% down at Rs 86.

Among the sensex stocks, other than RCom, which was the top loser, Tata Power lost 5.2% to Rs 1,229 and Reliance Infra closed 4.2% off at Rs 617. Of the 30 sensex stocks, 27 ended in the red.

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Essar becomes first Indian co to supply plates for warships

NEW DELHI: Essar Steel on Thursday said it has become the first Indian producer of steel plates approved by the government for supply to the Indian Navy for building strategic war ships.

"Essar Steel's plate mill became the first primer plate producer in the country to be recognized for indigenous development of steel for building ships for the Indian Navy ... Company has received a prestigious order from Mazagoan Dock (MDL) to supply 13,000 tonnes of heavy plates," the company said in a statement.

The heavy plates will be used for manufacturing state-of-the art ships for defence and this is for the first time that MDL has placed an order for such a large consignment of steel plates from a domestic steel mill.

The order, the company said, follows a "stringent mill audit of Essar Steel's recently commissioned wide-plate mill conducted by teams from the Directorate of Naval Architecture (DNA), Defence Metallurgical Research Laboratory (DMRL) and the Director General of Quality Assurance (DGQA) of the Ministry of Defence."

Set up at a cost of about Rs 2,000 crore, the plate mill has an annual production capacity of 1.5 million tonnes. "Equipped with state-of-the-art equipment and controls -- along with cutting edge technology sourced from Siemens Voest Alpine -- the mill is the only one of its kind in the country capable of producing 5-metre wide plates conforming to global standards," it said.

The plates find applications in diverse segments, including defence, oil and gas, boilers and pressure vessels, heavy duty earth-moving machines, wind towers, mine protective vehicles and construction.

Claiming that its products are ultra-strong and all-weather resistant, the company said until now, these products were largely imported.

It said Essar has also become the country's only steel plant with integrated facilities and items ranging from heavy plates to hot rolling and cold rolling products, with a full distribution business under the brand Essar Hypermarts.

The plate mill has unique finishing facilities that include normalised rolled, furnace-normalised, direct quenched, quenched and tempered (QT) plates and accelerated direct cooling (ADCO).

Essar Steel, a part of the Ruias-led Essar Group has a production capacity of 14 million tonnes per annum (MTPA).

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Food inflation at 8.53% year-on-year on April 23

NEW DELHI: The country's food price index rose an annual 8.53% in the year to April 23 while the fuel and power index stood at 13.53% in the same period, data released by the commerce ministry showed on Thursday.

Food inflation in the year to April 23 was a shade lower than the previous week's 8.76%.

Food prices have moderated in the past few weeks but have stayed above 8% while the wholesale price index has remained around 9% for March. WPI inflation data for April is likely to be released next week.

The primary articles price index rose 12.11%, marginally higher than the previous week's of 12.08%.

The Reserve Bank of India (RBI) has raised interest rates nine times since March 2010 to tame inflation and has said it is ready to sacrifice growth to tackle price pressures.

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Fuel price hike likely next week

NEW DELHI: Your motoring and cooking bills look set to rise next week. The ministerial panel on fuel prices is scheduling a meeting on May 11 to consider raising fuel prices after polling in five states gets over on May 10.

An increase of Rs 2-2.50 per litre in the price of diesel and at least a Rs 25 per cylinder increase in the cost of a cooking gas refill looks imminent.

Simultaneously, the government is also expected to give state-run oil marketers the cue to raise petrol price by at least Rs 3 a litre.

The government sets prices of diesel, cooking gas and kerosene. Oil marketers are free to revise petrol price but seldom act without government nod, which had been held back in view of the polls.

An indication of the government's resolve to finally bite the bullet came from a statement by the Congress that aimed at distancing the party from the decision and signals moderation in the quantum of increase.

Describing diesel price revision as a "sensitive issue", spokesperson Jayanthi Natarajan said the party wants that "the life of the common man should not be affected by any oil price hike."

The rise in global crude prices has left little room for the government to manouevre. It has not allowed state-run oil marketers to revise petrol price since January 15 to avoid upsetting voters ahead of the state polls. Diesel has been left untouched since June last year.

The net result is that the oil marketers are estimated to have run up a loss of Rs 180,000 crore in 2010-11. Last heard, they were losing about Rs 8.50 a litre on petrol, Rs 16.76 a litre on diesel, Rs 29.69 on kerosene and Rs 329.73 on a cooking gas refill.

In spite of crude's fall over the last to days on the news of Osama bin Laden's killing, the mix of crude state-run refiners buy has averaged over $120 a barrel. On the other side, pump prices of petrol price corresponds to about $100 per barrel and diesel around $90-95 a barrel of crude.

Politically, this appears to be the time to raise fuel prices. State polls would be over and the next Parliament session would be two months away, allowing enough time for Opposition voices to trail off on the streets.

UPA coalition partners such as Trinamool Congress and DMK, who would have received the people's verdict in West Bengal and Tamil Nadu, respectively, would not have much reason to oppose an increase in fuel prices.

But the high rate of inflation, about 9% in March, may still weigh down the ministerial panel. Diesel and cooking gas together have a weightage of 5% in the index of prices. An increase in diesel price is also bound to push up prices of most essential items since it is the main transportation fuel. This would adversely impact food inflation, that somehow refuses to come down.

The panel can, however, take comfort from Reserve Bank of India governor D Subbarao's call on Tuesday for an immediate hike in petrol and diesel prices. Subbarao had said such a move was required even if it were to add to inflationary pressure and moderates economic growth.

Banks hike lending rates by 0.5%

CHENNAI: A day after the Reserve Bank of India raised its policy rates, banks on Wednesday were quick to take the cue and responded by increasing their lending rates. Punjab National Bank (PNB), Oriental Bank of Commerce (OBC) and Yes Bank have raised their base rate and the BPLR (bench mark prime lending rates by 50 basis points or 0.50%, thereby making loans costlier both for their new as well as the existing borrowers.


IDBI Bank was the first to raise its interest rates. The bank increased both its lending and deposit rates by 0.5% on Tuesday soon after RBI's announced rate increases. PNB's new base rate and BPLR are 10% and 13.5% and are effective Thursday. OBC has revised its base rate to 10% and the BPLR from 13.75% to 14.25%.In an unexpected move the RBI in its monetary policy announced on Tuesday increased its key policy rates by 0.50%. The repo rate -- the rate at which the central bank lends to the banks -- now is 7.25% while the reverse repo rate -- the rate at which it borrows from the other banks is 6.25%. The latest hike, ninth in the past year, is aimed at cooling headline inflation.


"Rate hike is inevitable now. We will decide about increasing our interest rates in the next two days," S C Bansal, executive director, United Bank of India, said.


Bank of Baroda, too, hinted at a rate hike. "We will take a call in a day or two. We may not hike our deposit rates, as we have already raised it 2.50% (over the past few months) while our lending rates have gone up by 1.5%," R K Bakshi, ED, Bank of Baroda said.

According to T M Bhasin, CMD of Indian Bank, the bank's senior brass is meeting on Thursday to consider rate increases. There is a possibility of a 0.50% increase in its base rate as well as BPLR. However, the bank is not keen to raise it deposit rates. "Deposit rates are already high. We are not going to raise our deposit rates for the time being," he said.

However, some banks like OBC may raise deposit rates. "We will take a call on deposit rates in couple of days. We may increase our deposit rates by 0.25% to 0.5% on deposits schemes with less than 1-year maturity," said S C Sinha, ED, OBC .

Sensex recovers by 51 points in opening trade

MUMBAI: The BSE benchmark Sensex gained 51 points in opening trade on Thursday on the back of bargain buying of select stocks by funds and retail investors.

The 30-share index of the Bombay Stock Exchange, which has lost 1,133 points in the previous eight straight sessions, rebounded by 51 points, to 18,520.36 with oil and gas, PSUs, banking and capital goods sector stocks staging a partial recovery.

Similarly, the wide-based National Stock Exchange Nifty index also moved up by 12.00 points, to 5,549.15 points.

Brokers attributed the recovery in opening trade to emergence of buying by funds and retail investors as several stocks turned attractive at prevailing levels after the recent slide.

Covering-up of short positions by speculators in some stocks also supported the recovery, they said.

Meanwhile, Hong Kong's Hang Seng Index shed 0.44% in early trade on Thursday.

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20 basic rules for investing in mutual funds

- Important

1. Having an investment goal before investing is very significant. Investing without any goal doesn't help much. Be clear about objective what you are trying to achieve.


2. Don't start investment in mutual funds by investing in sectoral funds. Choose quality large cap mutual fund or a balanced fund like HDFC Balanced Fund as the starting point.


3. Choose index funds for hands-off investment and balanced fund to diversify across asset classes.


4. Large cap funds add stability to the portfolio while small cap funds can generate better risk-adjusted returns.


5. For retail investors, systematic investment plan is the way to go (investing in staggered manner). Don't try to time the market. Time spent in the market is more critical for your portfolio than timing the market.


6. Review progress of your mutual fund investment portfolio once every quarter. Additionally rebalance the portfolio to align it with your asset allocation once in 12 months. Look at the portfolio, look at the benchmark returns, and look at the peer returns and whether they are comparable. If there is something which is not in consonance with these benchmarks or the peer performances, you should certainly look at the fund more closely and find out why they are either, performing, under performing or outperforming.


7. Do not look at ratings only of a mutual fund as a sole criterion for selection: they tend to change very fast. Other points to consider while investing in a mutual fund could be: (a) How big is the fund? (b) How often does it buy or sell? (c) What are the risks involved? (d) What are the costs (e) Track the fund house record


8. The most significant aspect is to be able to start early even with small amounts. Compounding of returns will do wonders to your portfolio.


9. Since risk and return are two sides of same coin, inflation is eroding your wealth silently and hence its significant to outperform that through appropriate balance between risk and return.


10. Don't over-diversify your mutual fund portfolio. Don't choose so many funds which can make it difficult for you to manage them. Ideally don't have more than 5 funds in your portfolio.


11. Try to diversify your mutual fund investments across various asset management companies (AMCs) to de-risk your investments. Fund houses like HDFC, Franklin Templeton, Birla Sun Life are pretty creditable ones.


12. Don't panic during market downturn and don't stop your SIPs and don't sell your mutual funds unit. It will enable you to get more units at same SIP price.


13. Always evaluate tax liabilities before redeeming your mutual funds investments.


14. A fund size can have an impact on performance but a lot depends on actual investment pattern.


15. Avoid investing lump sum amount in mutual fund. Instead invest in a staggered manner using systematic investment plans. Withdrawing money systematically through systematic withdrawal plans is a good option as it ensures you minimise the chances of missing out on any market surge and reduce vulnerability to a sudden stop.


16. If you are investing in sectoral funds ideally you should understand sectoral cycles and understand the tenure before investing. Timely profit booking can be a good strategy.


17. Mutual funds give best returns in the long term if you don't churn (buy and/or sell) them regularly. Any transaction within one year of buying a fund also attracts short-term capital gains tax at 20 per cent


18. High risk doesn't always guarantee high returns.


19. Discipline and commitment are the buzzwords while investing in mutual funds through systematic investment plans (SIP).


20. If you are a savvy investor and are in a position to take risks, then get into equity funds. Otherwise don't get into equity funds.

Sensex closes 65 pts down amid volatility

MUMBAI: In volatile trading, the BSE Sensex fell for the eighth session in a row on Wednesday to close at 18,469, down 65 points, as investors continued to offload stocks in view of RBI's hiking key rates and projecting lower GDP growth for this fiscal.

The 30-share Bombay Stock Exchange index, Sensex, which lost 1,068 points in the last seven sessions, fell another 65.33 points to close at 18,469.36.

However, gains in the most-heaviest Reliance Industries saved it from a bigger loss.

The gauge remained volatile throughout the session moved between 18,604.36 and 18,339.53.

Similarly, the broad-based National Stock Exchange index Nifty fell 28.10 points to 5,537.15 as stocks of auto, IT, metal and healthcare suffered heavy losses amid a weak Asian trend and lower openings in Europe.

The Reserve Bank on Tuesday raised lending (repo) rate by 50 basis points to tame inflation and projected 8 per cent economic growth for this fiscal, as against the government's forecast of 9 per cent.

RBI also hinted at further tightening, saying that inflation is likely to stay at "elevated levels" until September and it would give priority to taming the rate of price rise.

The auto sector index suffered the most, falling 1.33 per cent to 8,988.12. Hero Honda fell 3.63 per cent to Rs 1,600.10 while Bajaj Auto plunged the most since August 2009 by losing 4.82 per cent to Rs 1,301.10. Tata Motors lost 0.25 per cent to Rs 1,160.50.

However, a firming trend in the oil and gas sector, led by Reliance Industries, saved the market from a major fall. RIL stocks, with nearly 13 per cent weightage on the Sensex, gained 0.32 per cent to Rs 947.

As selling spread over a broad front, smallcap index eased by 0.54 per cent to 8,390.30 and midcap index by 0.45 per cent to 6,865.96.
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Sensex tanks 463 pts as RBI hikes rates, projects lower growth

MUMBAI: The BSE Sensex plunged 463 points to 18,534 on Tuesday as investors dumped interest-sensitive stock after RBI hiked key policy rates by 50 basis points to tame inflation, and projected low growth for this fiscal.

In its longest losing stint since November 2008, the 30-share Bombay Stock Exchange index, Sensex, which had lost 604 points in last six trading sessions, tanked another 463.33 points to close the day at 18,534.69.

The plunge was triggered by banking and other interest sensitive stock.

Similarly, the broad-based National Stock Exchange index Nifty dipped 136.05 points to 5,565.25 -- below psychological mark of 5,600.

After a weak start, the market tumbled as the Reserve Bank of India hiked short-term lending (repo) rate by 50 basis points to 7.25 per cent, while lowering the economic growth projection to 8 per cent for 2011-12.

The Sensex has declined 8.2 per cent this year on fears that high inflation and interest rates to tame it will make borrowing costly, crimping corporate earnings.

The banking sector index plunged by 3.11 per cent to 12,406.67, as State Bank of India lost 4.03 per cent at Rs 2,583.10.

The auto sector index was the worst performer and dropped by 3.74 per cent to 9,108.98 as on fears that high interest rates will hit sales.

Tata Motors dropped 5.30 per cent at Rs 1,163.45 and Mahindra and Mahindra fell 4.47 per cent to 707.85.

Another interest-linked realty sector index fell 2.91 per cent to 2,140.90 as DLF, the biggest developer, slid 2.56 per cent to Rs 220.80 and Jaiprakash Associates, a builder of dams, roads and bridges fell 8.05 per cent to Rs 85.05.

The two most-heaviest on the Sensex, with 23 per cent weightage - Reliance Industries and Infosys Technologies - closed with losses.
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Car sales growth slows in April

NEW DELHI: Car sales started the new fiscal on a modest note as rising interest rates and fuel prices are set to moderate demand from the scorching 30%-plus growth rate of 2010-11.

Companies are already concerned about the "negatives" that are building up at a time when vehicle prices have gone up due to higher input costs, hitting affordability and sentiments. Maruti and Hyundai both spoke of decline in footfalls. And with the central bank

RBI expected to tighten key interest rates further in its monetary policy review on Tuesday, the industry remains nervous.

"Higher prices of fuel and rising interest rates are already creating a pressure in the market. Footfalls in showrooms have come under pressure," Maruti's managing executive officer (sales and marketing) Mayank Pareek said. Hyundai's marketing and sales director Arvind Saxena said the bearish trend was likely to continue. "The rising interest rates have led to reduced enquires and the conversion rate too has slowed down," Saxena said.

The after-effects of the Japanese quake, that has forced companies like Honda and Toyota to slash production, are likely to put further pressure on sales. Maruti's sales in April grew in single digit. The company said domestic volume stood at 87,144 units, up by 9%. For Hyundai, the growth was 11% as it sold 31,636 units in the first month of this fiscal.

The biggest disappointment came from Japanese giant Honda, which saw volumes fall by as much as 44% at 2,012 units. "As announced earlier, the Japan issue prompted us to reduce production at our Greater Noida plant to 50% from this month. However, production adjustments for a smooth transition began from mid-April," said Jnaneswar Sen, sales and marketing head at Honda Siel Cars.

New models from Ford, Volkswagen and Toyota had led the charge last year.

However, a strong base caught up with Ford that saw volumes decline by 2.5%. It will launch its new global sedan Fiesta in the market soon as it goes ahead with its plans to bring in eight new models by 2015.

Analysts said any big push in demand will come only from the new models that would hit the market later this fiscal. However, doubts have surfaced even on this as the Japanese quake and tsunami have impacted the plans of Honda and Toyota, both of whom are slated to get in new small cars. While Toyota has to launch the Liva compact, Honda is to get the Brio hatchback. "The situation remains fluid as we speak," Sen said.

The analysts said that despite the negatives, the economic growth is expected to keep demand going. "So long as the economy continues its pace, there is not a big worry for companies as salaries will rise and jobs created. This will keep the momentum going, although at a slower pace," an analyst with a brokerage firm said.


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Rupee opens 8 paise lower against US dollar

MUMBAI: The Indian rupee depreciated by 8 paise to Rs 44.41 against the US dollar in early trade on the Interbank Foreign Exchange on Tuesday, weighed down by dollar gains against other currencies overseas and a weak trend in the equity market.

Forex dealers said the strengthening of the dollar against major currencies overseas and a weak start in the stock market mainly put pressure on the rupee.

The rupee fell by 11 paise to close at Rs 44.33/34 against the US currency in yesterday's trade due to dollar demand from banks and corporates.

Meanwhile, the Bombay Stock Exchange benchmark Sensex fell by 97.39 points, or 0.51%, to 18,900.63 in opening trade on Tuesday.