Mumbai, June 27
The Sensitive Index (Sensex) of the BSE extended its rise for the third straight session as it gained 0.9 per cent on Monday, with state-run oil companies rallying after the government raised state-controlled fuel prices, which would boost their earnings.

Traders said the market was riding an upbeat mood after last week’s 2-per cent rally, the first weekly rise since early June, and helped by demand from fund managers looking to spruce up their portfolios before the quarter closes.

Oil & Natural Gas Corp , whose subsidy burden will drop following the increase in fuel prices, rose as much as 9.1 per cent early. It closed 4.2 per cent higher.

Oil marketing companies Hindustan Petroleum Corp , Bharat Petroleum Corp and Indian Oil Corp rallied between 3.2 per cent and 5.8 per cent.

The 30-share BSE index firmed 0.94 per cent, or 171.73 points, to 18,412.41 points, with 23 components advancing.

“Market welcomed the hike in fuel prices, as it was a bold step towards implementing reforms,” said Rakesh Rawal, head of private wealth management at Anand Rathi Financial Services.

Foreign funds turned net buyers on Thursday with an investment of $108 million, after being sellers of $688 million over the previous eight sessions.

"It will be range-bound for now. There is no reason for it to go all over the place, unless the June-quarter earnings bring along positive surprises,' said Rawal.

The BSE main index is headed for its second annual decline in a decade as persistently high inflation, rising interest rates and slowing growth keep investors at bay.

The 50-share NSE index closed 1 per cent higher at 5,526.60 points. Gainers outnumbered losers in the ratio of 1.7 to 1 in the broader market.

World stocks fell as investors went on the defensive ahead of a Greek austerity vote this week that may sow stronger doubts about financial stability and economic recovery.— Reuters

New Delhi, June 27
The Supreme Court will hear on July 4 a Sahara group firm's plea challenging a SEBI order directing the company to return money collected from investors through a scheme along with 15 per cent interest.

A vacation bench of the apex court, comprising justices P Sathasivam and A K Patnaik, decided to hear the matter on July 4, the first day after the vacation, after Sahara India Real Estate Corp today apprised the bench of its plea filed with the apex court registry.

The Sahara group firm sought directions to SEBI to remove the June 23 order from its website and restrain the market regulator and its officials from publicising the order which it has challenged.

The counsel appearing for Sahara group firm said his client wants SEBI to expunge the parts of the order directing it to return money with interest to the investors as it has created a panic among the investors.

"The 99-page order (by SEBI) has created panic among the investors. They (SEBI) are holding press conferences and giving out press releases about the order," he said.

The case will now be heard by a three-judge bench headed by Chief Justice S H Kapadia which has been hearing the case.

The Supreme Court, on May 12, had directed SEBI to pass an appropriate order on Sahara group's plea challenging an Allahabad High Court order restraining it from further issuing the Optionally Fully Convertible Debentures (OFCDs) and on a SEBI plea for direction to the group to apprise the market regulator about its investors and their fund invested.

"SEBI, being the custodian of investors' interest and as an expert body, should examine these questions (on OFCD). Before we pass further orders, we want SEBI to decide the applications pending before it so that we could obtain the requisite input for deciding these petitions," the SC bench headed by Chief Justice S H Kapadia had said.— PTI

New Delhi, June 27
Agriculture Minister Sharad Pawar has sought Prime Minister Manmohan Singh's intervention to decide the final price of ethanol for blending in petrol to ensure smooth supply of the product during the 2011-12 season.

In August last year, the government had fixed an interim price of Rs 27 a litre for ethanol under the Ethanol Blending Programme (EBP) for mandatory blending of 5 per cent ethanol with petrol. An expert committee, headed by Planning Commission Member Saumitra Chaudhuri, was also set up to recommend a formula for ethanol pricing.

"I will strongly advocate that we must now crystallise our EBP programme by deciding the final price of procurement on ethanol and inviting tenders for the supply of ethanol during the 2011-12 sugar season. I would sincerely request for your kind intervention in this matter," Pawar said in a letter to the Prime Minister.

The expert panel sumitted its report in April, 2011, "but no further action has been initiated," he noted.

Due to delays in announcing the final rate for ethanol and the difficulties in selling the available molasses in the domestic market, over six lakh tonnes of molasses had to be exported in the past six months at minimal prices, he noted.

“I am given to understand that these exported molasses are used basically for cattle feed. Six lakh tonnes of molasses would have given 15 crore litres of fuel ethanol, sufficient to substitute almost one per cent of the country's petrol consumption. This is wastage of resources,"” Pawar said.— PTI

Inflation continues to remain a worry globally and most central banks have been / or plan to raise interest rates to curb this. RBI has raised interest rates ten consecutive times. High interest rate regime coupled with higher commodity prices has affected the industry to a great extent in the last six months.

The recent low readings of the IIP exaggerate the deceleration in overall industrial activity. For the full year FY11, IIP grew at 7.8% Y-o-Y, slower than the 10.5% growth in FY10, owing largely to base effect.

The Indian markets turned negative on the back of these concerns. The markets started the month of April on a positive note, buoyed by some unexpected resurgence in FII buying in March. However, post the beginning of corporate earnings announcements and political concerns, the markets lost steam.

The markets had been overly optimistic hoping for earnings surprises, but many firms have underperformed street expectations. The allocations towards emerging markets by FIIs has also slowed down due to the economic concerns and earnings downgrades.

The sectors which are interest rate and inflation proof should be targeted over the next few months till the economy stabilizes.

Additionally stocks which are fundamentally strong and can command higher price realizations would be appropriate investment targets. Investors should look for opportunities in IT, Pharmaceuticals and good FMCG & agri based companies.

Once the economy is in proper shape, investors can increase the allocations towards banking and infrastructure sector which would be the backbone of wealth creation in next couple of years.

The outlook for the banking sector in coming quarters appears neutral on the back of probable credit growth slowdown and expected margin pressure.

Net interest margin is likely to be under pressure in near term due to rise in cost of funds & ALM mismatch in an increasing rate scenario. CASA growth for most banks would slowdown a bit as banks will go slow on this front before the much debated savings rate deregulation pass through.

Deposit growth which had been a laggard till now, may see some revival going forward due to recent SB & FD rate hikes. Given the current environment of macro headwinds, we remain selective and prefer banks with a) robust deposit franchise, b) diversified loan book & growth visibility, c) healthy capital adequacy and d) comfortable valuation.

The demand scenario for the IT sector is expected to improve going forward with verticals like Manufacturing, Retail and BFSI seeing a pickup globally.

The Telecom sector may continue to be a laggard for some time. IT firms like Infosys, HCL Technologies and TCS all have aggressive hiring targets for FY12.

However, such infrastructure expansion to capture business could bring these firms' margins under pressure in the near-term. The increase in tax rates (STPI cancellation and MAT implementation in SEZs) could bring pressure on the bottom-line of mid-cap IT companies.

The business restructuring in Infosys and Wipro will also take some time to reflect positively in the company’s top-lines.

We feel the market would be range bound between Nifty at 5,200 and 5,700 till the inflation and interest rate concerns hover in the minds of investors.

New Delhi, June 27
The tablet war in the country intensified today with the Taiwanese handset maker HTC launching its "Flyer" tablet priced at Rs 39,890.

We saw an opportunity to create a tablet experience that is different, more personal and productive and are extremely excited to introduce the HTC Flyer in the Indian market," HTC India Country Manager Faisal Siddiqui said in a statement.

Flyer's competitors in India include the Apple iPad, Samsung's Galaxy Tab, Blackberry Playbook and the soon-to-be launched Motorola Xoom and Huawei's MediaPad.

Since the launch of Apple's iPad, the tablet market is witnessing huge competition, with new contenders launching their devices. Apple's rival in the computing space, Dell had launched the "Streak" in India last year, Spice and Olive have also launched similar devices at much lower price points.

HTC’s Flyer has a seven-inch touch screen with a 1.5GHz Qualcomm Snapdragon processor. It has 1GB of RAM.