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Global stock jitters as oil reaches $142
SBI hikes interest rates on deposits
Forex reserves up by $2 b
IPI pipeline: India, Pak resolve issues
ICAI to converge with IFRS norms
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Daiichi may sell debt to pay Ranbaxy
HPSIDC nets profit
India slips in Forbes global ranking
Unitech to offload 26% in telecom arm
Ludhiana gets first Reliance footwear store
India’s first power exchange goes live
India extends line of credit to Myanmar
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Global stock jitters as oil reaches $142
London, June 27 The Wall Street looked set for a cautious start after Thursday’s slide that sent the blue-chip Dow skidding to a 21-month low.
Fresh data showing surging energy and other raw material costs putting upward pressure on prices from Germany to Japan further spurred investors to cut back on risky trades, helping boost the yen to three-week high versus the dollar. “There is a bout of risk reduction across assets ... Oil prices headed up and that’s putting more pressure on equities," said Martin McMahon, FX strategist at Credit Suisse in Zurich. The FTSEurofirst 300 index of top European shares slumped to its lowest level since October 2005, while the MSCI main world equity index fell 0.6 per cent to a three-month low, on track for its worst monthly performance in percentage terms since September 2002. US stock futures were all lower. Earlier, Japanese stocks shed 2 per cent to a two-month closing low while speculation of an imminent interest rate hike in China pushed local shares to a 16-month trough. The latest round of selling in global stock markets began earlier this week when Goldman Sachs urged investors to sell US bank and automaker shares, forecasting more write-downs for financial firms like Citigroup. US crude rose more than $2 a barrel to a new all-time high of $142.26 on Friday, while gold climbed to a one-month high of $925.30 an ounce as tumbling stocks and a weaker dollar boosted the metal’s safe-haven appeal. Oil prices have doubled from $70 a year ago on supply disruptions and geopolitical tensions in West Asia, while rising flows of cash into commodities from investors seeking to hedge against inflation and the weak dollar have added to gains. The dollar fell 0.1 per cent against a basket of major currencies, having earlier carved out a fresh three-week low given the gloomy outlook for the US economy. It also plumbed a three-week low of around 106.17 yen. Inflation picture worsening
Safe-haven government bonds mostly erased early gains, pushing yields slightly higher on expectations that central banks will be forced to lift rates to fight inflation. The US two-year yield climbed one basis point to 2.68 per cent, while the two-year Schatz yield was little changed at 4.43 per cent. Data from five German states so far showed inflation in Europe’s biggest economy likely accelerated in June. Separate reports showed French producer prices posting their biggest jump in almost a decade in May, Spanish consumer inflation hit an 11-1/2 month high in June, while Japan’s annual consumer inflation accelerated to a new decade-high of 1.5 per cent in May. The inflation picture is worse in emerging markets, where countries like Vietnam and India are already experiencing double-digit inflation. “The macroeconomic environment has turned far more challenging for EM policymakers. Slowing growth and accelerating inflation create a tough policy backdrop,” Lehman Brothers said in a note to clients. “Central banks are raising rates and could easily err by being too hawkish or too dovish. There is a rising risk of policy mistakes. Political pressures to intervene in markets are growing, potentially creating long-term distortions and weakening fiscal frameworks.” The European Central Bank is likely to become the first G7 central bank to raise interest rates next week, pushing the cost of borrowing to 4.25 per cent. |
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SBI hikes interest rates on deposits
Mumbai, June 27 For deposits with duration of 181 days but less than a year, the interest rate would be 8 per cent, up form of 7.5 per cent, SBI informed the BSE. Deposits with duration of one year to less than two year and two years to less than three years will fetch an interest rate of 9.5 per cent, up from 8.75 per cent. The deposits rate for three years to less than five years will be 9 per cent against 8.85 per cent. However, interest rates for short-term deposits with durations up to 180 days have not been altered. The bank has also increased deposit rates for senior citizens. For them, deposits with duration of one year to less than three years will fetch an interest rate of 10 per cent as against 9.25 per cent. Meanwhile, Punjab National Bank, Bank of India and Canara Bank have decided to hike their benchmark prime-lending rates (BPLR) with effect from July 1. The revised rate of Bank of India would now go up to 13.25 per cent from the existing 12.75 per cent. PNB today decided to increase its PLR by 0.5 per cent to 13 per cent. At the same time, the bank also deposit rates by up to 50 basis points for various maturities in a bid to maintain its net interest margin. Canara Bank has also announced an increase in its BPLR. The revised rates would be 13.25 per cent as against 12.75 per cent at present. Earlier, State Bank of India and Union Bank of India had also raised their PLR by 50 bps within two days after the central bank hiked the key lending rate as well as cash reserve ratio by the same proportion. — Agencies
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Forex reserves up by $2 b
New Delhi, June 27 Reserves rose to a record $316.171 billion in late May and analysts said the decline since then is due to dollar sales by the central bank in the currency market to prop up the rupee and giving foreign exchange to oil companies to meet their import payments. The central bank said foreign currency assets, expressed in dollar terms, included the effect of appreciation or depreciation of other currencies held in its reserves such as the euro, pound sterling and yen. |
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IPI pipeline: India, Pak resolve issues
New Delhi, June 27 “I am happy to report that as far as Pakistan and India are concerned, we have resolved all bilateral issues. There is no issue whatsoever that needs to be addressed now,” visiting Pakistani foreign minister Shah Mahmood Qureshi told reporters after a brief meeting with petroleum minister Murli Deora. India has been boycotting Iran-Pakistan-India (IPI) gas pipeline talks since August 2007 over transit fee demanded by Pakistan for passage of gas through that country. Differences between the two nations were narrowed at a meeting of oil ministers in Islamabad in April. “Transit fee is a small issue. We have reached an agreement on the principles of charging transit fee. India remains fully committed to the project,” Deora said. Oil secretaries of the two countries will now meet, as early as July 1 in Madrid, to evolve a strategy to deal with Iran’s insistence on a price revision clause in rates already agreed by the three nations. Both India and Pakistan are opposed to the new clause and plan to make a joint case at the trilateral meeting that may take place in Tehran next month. Qureshi, who also holds additional charge of oil ministry, said his country had no issues with India’s demand that Iran hand over custody of gas at the India-Pakistan border and not at Iran-Pakistan border, as had been suggested by Tehran, to cut transit risk through Pakistan. On security of the pipeline and safe passage of gas, which has been the prime concern of New Delhi, he said: “Pakistan will address the security issue and provide fool-proof security.” — PTI
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ICAI to converge with IFRS norms
New Delhi, June 27 Jain also said ICAI has started a new chapter in New York. It is the 21st among its foreign chapters. The foreign chapters provide the ICAI members abroad a platform to work on different set of rules, Jain said. The ICAI has already decided to introduce second tier qualification known as accounting technician to meet emerging requirement thereof in the Indian economy. ICAI now not only focuses on its core domain but also extends its work program to all aspects of financial governance. The ICAI has been in constant dialogue with various ministries in the Centre and state governments, providing policies inputs, and strengthen public expenditure management, he said.
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Daiichi may sell debt to pay Ranbaxy
Tokyo, June 27 Daiichi Sankyo will tap its more than 6 billion dollar of cash to pay for about half the controlling stake in Ranbaxy, the Tokyo-based firm's president, Takashi Shoda said. A bond sale is "one option" along with the bank borrowing to cover the rest, he added. "We'll consider the best way to raise the money," Shoda said. Daiichi Sankyo will keep about 200 billion yen ($ 1.9 billion) of cash on hand for day-to-day operations and apply the rest to expansion or to share buybacks and dividends, he said. — Bloomberg |
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HPSIDC nets profit
Shimla, June 27 This was stated by Chief Minister P. K. Dhumal while presiding over the board of directors meeting of the HPSIDC, General Industries Corporation and Nahan Foundry here today. He said the government was making efforts to bring all the public sector undertakings (PSU) out of losses by diversifying their activities. He said a strict professional approach was required to meet the challenges of global marketing. “While some of the PSUs have taken this path successfully, others need to do the same so that they can earn profit,” he said. |
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India slips in Forbes global ranking
New York, June 27 India has dropped from 51st place, whereas China is two notches down from last year’s ranking at 79 in the Forbes list of ‘best countries to do business’. The list is topped by Denmark, climbing three spots from the previous year, followed by Ireland and Finland. “India and China fell in this year’s banking as political instability demonstrated resistance to increasing personal freedoms. Higher inflation from food and other commodity costs, as well as increased burdens on entrepreneurs also held the world’s most populous nations back as business destinations,” Forbes said in an accompanying report. Denmark, which rose three slots from last year, Ireland (No 2), Finland (No 3), the US (No 4) and UK (No 5). Big movers like Ireland, Estonia (No 10, up 24 spots) and Saudi Arabia (No 47, up 37) have limited bureaucracy standing in the way of entrepreneurs hoping to do business there. However, the world's largest economy the US declined one spot to the fourth place, whereas another economic giant the UK retained its fifth position. Pointing out that India has reduced controls on foreign trade and investment, Forbes said tariff spikes in sensitive categories, including agriculture, and incremental progress on economic reforms still hinder foreign access to India’s vast and growing market. “Privatisation of government-owned industries remains stalled and continues to generate political debate; populist pressure from within the UPA government and from its Left Front allies continues to restrain needed initiatives," the report noted. Forbes said strong growth combined with easy consumer credit and a real estate boom fuelled inflation concerns in 2006 and 2007. This had led to a series of central bank interest rate hikes that have slowed credit growth and eased inflation concerns. “The huge and growing population is the fundamental social, economic, and environmental problem," it said. "Investor protection examines the recourse held by minority shareholders in cases of corporate misdeeds, while corruption looks at the number and frequency of similar misuse of corporate assets for personal gain. Together with economic policies supportive of free trade and low inflation, these key points form a snapshot of countries' suitability for capital investment,” the magazine said. Developed countries like Germany (21st rank) and France saw declines in their respective rankings due to scandals in the banking sector and tougher barriers for entrepreneurs. One of the biggest falls came from Japan, which dropped to 24th rank from 21st position. — PTI
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Unitech to offload 26% in telecom arm
New Delhi, June 27 “We are looking for a minority dilution of 26 per cent stake to a strategic foreign player in Unitech Wireless," Unitech Ltd managing director Sanjay Chandra told reporters. Unitech was one among the many unified licenses issued by the Department of Telecom earlier this year. Unitech Wireless, which has bagged a pan-India GSM license, has already got the crucial spectrum for five circles and the company is planning to roll out telecom services by the last quarter of the current financial year, he said. To fund the telecom operations, it is considering to raise debt up to Rs 8,000 crore in the next five years once the company starts services. “Raising Rs 8,000 crore is the peak amount. Once we finalise the partner and start services, we will look at raising the amount. We will also have vendor financing,” Chandra said, adding that at a future date the company would spin off the telecom arm into a separate company. “Unitech Wireless is currently a subsidiary of the main company, but in the future we will see it as a separate company,” Chandra said. The company would invest the money in purchase of telecom equipment and developing infrastructure, he added. “Currently, we are talking to three European and two Chinese firms for supplying telecom equipment," he said. When asked if the company would bid in the auctioning of 3G spectrum, Chandra replied in positive. — PTI
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Ludhiana gets first Reliance footwear store
Ludhiana, June 27 The footwear speciality stores offer national and international brands under one roof. “There are outlets of various brands but at these stores we are offering a large number of brands under one roof. The segment is relatively untapped and we are buoyant on growth,” Reliance Footprint chief executive Gopalkrishnan Sankar told The Tribune. Sankar said the company would have stores in Jalandhar and Amritsar in the next two-three months while 30 more would be opened in metros and mini metros a year down the line. Spread in an area of 10,000 square feet, the store in Ludhiana is the largest footwear destination in the country, he added. “There is a range of about 25,000 products catering to the entire family from formals, casuals, ethnic, sports and party wear categories.” The brands include Hush Puppies, Geox, Azaleia, Lee Cooper, Disney, Puma and others. Reliance also has its in-house brand Bonanza. Talking about customer segments, Sankar said while middle and upper middle-income groups remained the major focus, the company would endeavour to cater to a wide range of consumer segments. |
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India’s first power exchange goes live
New Delhi, June 27 IEX, promoted by Financial Technologies and public sector PTC India, has Infrastructure Development Finance Company, Adani Enterprises, Reliance Energy, Lanco Infratech, Rural Electrification Corporation and Tata Power Company as other stakeholders. Financial Technologies has a 90 per cent share in IEX while the remaining are shared by others. Over 50 members and users have been identified for participation in the first phase. Major members and clients who participated today were from Maharashtra, Tripura, West Bengal, Karnataka and Madhya Pradesh. “It is highly satisfying to see IEX go live as hard work of entire industry has paid off with the commencement of power trading today in the country,” IEX chairman Venkat Chary said. On June 9, the Central Electricity Regulatory Commission had allowed IEX to start operations. — PTI |
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India extends line of credit to Myanmar
New Delhi, June 27 Minister of state for power Jairam Ramesh, who returned after a four-day visit to Myanmar, said India had signed a line of credit of $64 million for three important transmission projects to be undertaken in Myanmar. The credit is being extended by Exim Bank that had signed agreements with Myanmar Foreign Trade Bank. The line of credit will finance constructions of three transmission lines and aluminium conductor steel reinforced wire-manufacturing factory in Myanmar. Ramesh said Power Grid Corporation of India Limited would take up the construction of all three transmission projects making its debut in Myanmar. The transmission lines are Thatay Chaung-Oakshitpin, Thatay Chaung-Thandwe-Maei-Ann and Thandwe-Athoke of 230 kv lines each. In addition to this, he said another $60 million credit was being extended by India for setting up a 3X40 MW power project at Thatay Chaung. The project will be executed by BHEL. The power minister said Myanmar leadership had also shown keen interest to join hands with the Indian companies to take up construction of 1,200 MW Tamanthi power project and 660 MW Shuve Saysay power projects on Chin Wind river in order to tap hydropower potential in Myanmar. “The Myanmar government is keen that Indian companies should take up these projects. We would soon take a decision on making the necessary investments,” Ramesh added.
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ABG Shipyard bags order Bharat Electronics net up Financial results of Markfed MSCB ties-up with Bajaj Allianz
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