New Delhi, July 16
Market regulator SEBI has allowed investors to place buy or sell orders on the stock exchanges before the opening of trade, a move which could tame volatility in the market.

The new mechanism, known as the pre-open session call auction, will last for a duration of 15 minutes and will be introduced on a pilot basis by the BSE and NSE, SEBI said in a circular.

Explaining the move, analysts said only Nifty and Sensex companies will be eligible for this kind of investment in the cash segment.

In the first 15 minutes, investors can place orders for eight minutes on the basis of which the exchanges will determine the rates at which trading will happen.

In the next seven minutes, the exchanges will execute the orders at the identified rates.

A total of 50 companies are listed on the Nifty, while 30 are on the Sensex.

Analysts said since the exchanges will identify the rates in this pre-trading session, volatility will be reduced in the initial hours.

In a call auction, participants indicate their willingness to buy or sell units of a security by placing an order for a number of units at the prevailing price.

At some point in time, the orders collected are matched to form contracts.

Market experts said the move is an effort towards integrating the Indian markets with international markets, as US and European markets already see pre-opening trade.

"This is done to smoothen the fears and shocks... because of the developments overnight. This is a good move, especially as the Indian investors are influenced by overseas markets," SMC Capitals equity head Jagannadham Thunuguntla said.

SEBI has asked the stock exchanges to put in place a mechanism to implement the same immediately. This framework for call auction shall be reviewed after three months from the commencement of the pre-open session. — PTI

Chandigarh, July 16
The scheduled commercial banks have decided to come to the aid of flood-affected farmers of Punjab and Haryana. These banks have decided to increase the repayment schedule for agriculture loans given to farmers in 12 flood-hit districts of the two states.

All commercial banks have now decided that they will convert all short-term agriculture loans as well as short-term loans given to small and medium enterprises (SMEs) in the two states into medium-term loans. The loanees will not be charged any additional rate of interest for this restructuring, and will pay interest only for the time period that the loan was taken.

The move follows a direction issued by the RBI earlier this month, which has asked the banks to restructure short-term loans given to farmers and SMEs in case of any natural calamity. In fact, the RBI has a provision to restructure loans given to farmers and SMEs in case of natural calamities, and a reminder circular was issued on July 1.

Since the SME sector, too, has been hit by the floods, this relief has also been extended to them. Following this, the State Level Bankers Committee for Punjab and Haryana, has asked its lead district managers in all flood-affected districts to convert all these short-term loans into medium-term loans. This means that the loans which had to be paid within a year, will now have to be paid within a period of three to five years.

It may be noted that the cooperative banks in Punjab and Haryana have already decided to convert the short-term loans into medium/long-term loans. In Haryana, short-term loans worth Rs 201.21 crore, given by the cooperative banks to farmers in Sirsa, Fatehabad, Ambala, Yamunanagar, Kaithal, Kurukshetra and Karnal, have been converted into long-term loans. Loans worth Rs 71 crore had been advanced to farmers in Ambala, Rs 55 crore in Kaithal, Rs 46 crore in Kurukshetra, Rs 22.09 crore in Fatehabad, Rs 6.12 crore in Sirsa and Rs 1 crore in Yamunanagar.

In Punjab, the cooperative banks have converted the short-term loans into long-term loans for farmers in Patiala, Sangrur, Mansa, Ludhiana and Fatehgarh Sahib districts.

New Delhi, July 16
The issue of restrictions on import of China-made telecom equipment, which the government had barred because of security concerns, is likely to be resolved over the next few weeks.

"We do hope that it will be resolved with the Home Ministry within a couple of weeks," Telecom Minister A Raja said here today. He added that he has already discussed the issue with the Home Minister after the security concerns were raised.

India is concerned that Chinese equipment may have spying technology embedded to intercept sensitive conversations and government documents. "Some of the issues were there. We wanted to find out some solutions (on) how it can be amicably settled," Raja said.

The minister’s statement comes just a day after his junior minister Sachin Pilot said, "Soon we are going to finalise a methodology to ensure that import of telecom equipment is streamlined".

The controversy over security concerns regarding Chinese vendors has been troubling the telecom sector over the past few months.

Though the government denies any blanket ban on import of telecom equipment and network gears from China, various companies like Huawei and ZTE have complained that the government has not approved their deals in the past few months.

Washington, July 16
The US Senate passed the Wall Street Reform Bill that will make financial institutions more accountable and make them pay for any repeat of a 2008-like credit crisis by liquidating their assets.

President Barack Obama is expected to sign the Bill, passed by the Senate by a 60-39 vote yesterday, into a law next week. The House of Representatives had already passed the Bill earlier this week.

The law will check taxpayers' money from being used to pay for the financial mismanagement of institutions.

The bailout of failed banks in the aftermath of the 2008 crisis was estimated to exceed over $1 trillion.

"It (legislation) strengthens the consolidated supervision of systemically important financial institutions, gives the government an important additional tool to safely wind down failing financial firms, creates an inter-agency council to detect and deter emerging threats to the financial system...," said Ben S Bernanke, chairman of the Board of Governors of the Federal Reserve System.

Terming the Bill as "strongest protection to the consumers and taxpayers they have ever had", Senate Majority Leader Harry Reid said: "We are giving Wall Street the strongest oversight it's ever had - not to stifle it, but to safeguard us. We are taking the shady markets that operate in the darkness and bringing them out into the daylight." Senator Bernie Sanders, in a statement, called the overall legislation a "positive step forward" but said much more was to be done to end the greed and recklessness by the Wall Street financiers responsible for the worst economic collapse since the 1930s.

The senator faulted the legislation for not breaking up banks deemed "too big to fail".

Incredibly, three of the four biggest banks in the country are larger today than they were before taxpayers bailed them out. Sanders also wanted the Bill to impose a cap on runaway credit card interest rates.

Among others, the provision requires extractive companies listed on the US stock exchanges to disclose, in their SEC filings, payments made to governments for oil, gas and mining. — PTI

New Delhi, July 16
Country’s largest telecom operator Bharti Airtel added three million mobile subscribers in June, taking its total to 136.6 million subscribers, the Cellular Operators Association of India (COAI) has said.

The data brought out by the COAI also said Vodafone Essar, the country's third-largest mobile operator, gained 2.7 million subscribers in June to have a total of 109 million.

The details came as another research said that India’s mobile subscriber base should grow to 993 million by 2014.

According to researcher Gartner, the world’s fastest-growing mobile market is expected to close 2010 with more than 660 million subscribers.

India is the second-largest wireless market in the world after China with its 618 million mobile subscribers at May-end.

Mobile connections were at 525 million at end-2009. While the TRAI’s data includes fixed wireless subscribers of operators like Reliance Communications and state-owned BSNL, Gartner forecasts exclude these subscribers.

More than half of India’s population now have a mobile phone, and Gartner sees the penetration reaching 82 per cent by 2014.

Sharp fall in call charges and launch of services by new mobile operators have helped the country step up mobile subscriber additions in the past one year, but increasing mobile penetration could lead to some slowdown in future growth.