Market Likely To Lower Open On Weak Asian Stocks

Market may drift lower in opening trade on weak Asian stocks. Trading S & P CNX Nifty on the Singapore Stock Exchange, representing a decrease of 51.50 points in the opening of the futures market.

Foreign institutional investors (IIE) has sold shares worth Rs 1636.08 crore in a single mass meeting Thursday, November 24, 2011, according to preliminary data of the award. FIIs pressed heavy sales of securities in India recently. Its production amounted to 6483.66 crore in eight trading session R 15-24 noviembre, 2011, according to the bag.

The actions of organized retail – Trent, Pants Retail India, Shoppers Stop and can extend its recent rally after the Council of Ministers of the Union Thursday, November 24, 2011, released a proposal to allow 51% of Foreign direct investment (FDI) in multi-brand retail and increase foreign direct investment in single brand retail and 100% of the current 51%. Currently, the country allows 51% FDI in retailing a single brand and 100% FDI in cash and carry format of the company. The movement to liberalize the standard IDE in detail the signs that the government of India, after years of hesitation on allowing more foreign investment in various sectors, is now seriously to attract foreign funds. Foreign direct investment in India fell from 28% to $ 29.4 billion in the year March 31, 2011, while the country’s economic prospects in the dark.

Further opening of the retail market – and the message it sends information about the government’s intention to introduce reforms – can help boost the economy and shore up the shaky investor sentiment. The government is likely to indicate the data of the new FDI norms in retail trade in Parliament today, 25 November 2011.

Liberal FDI norms in retail terms and conditions may be: a government proposal recently suggested that foreign investors may invest at least $ 100 million to set up multi-brand outlets, and that at least $ 50 million that is invested in back-end functions as a unit of processing and storage of food, and supply chain among other things. There may also be restrictions on where dealers can set up a business – for example, limiting their presence in the city with a population of over one million people.

Key benchmark indices rose slightly on Thursday, 24 November2011, after recent data showed that food inflation declined in the year through November 12, 2011. BSE Sensex surged 158.52 points or 1.01% to 15,858.49, its highest closing level since Nov. 22, 2011. The rebound comes after a recent steep slide. From a recent high of 17569.53 November 8, 2011, Sensex had declined 1869.56 points or 10.64% in ten trading days to two years of closing down 15,699.97 Wednesday, November 23, 2011.

The Union Cabinet Thursday, November 24, 2011 approved the draft law of companies, in 2011, aimed at updating corporate laws in the country and to introduce modern concepts. To replace the current half-century old Corporations Act, the project has undergone several changes for R-14000 crore accounting fraud at Satyam Computer. Following Cabinet approval, is now likely to be the consideration and adoption at the current winter session of Parliament. In addition to strengthening the provisions of check fraud, the ideas presented Bill with mandatory corporate social responsibility (CSR), class actions and a fixed time for the independent directors.

Among other things, it is also proposed to strengthen the laws to raise money for the public. Proposed law also seeks to prohibit insider trading by executives or key management personnel activities such as dealing with criminals. Moreover, it is suggested that companies should allocate 2% of the average profit of the previous three years CSR activities and to make public shareholders about the beginning of the process of writing.

Securities and Exchange Board of India (SEBI) is Thursday, November 24th, 2011, the strict rules on stock options issued and reserved for the public and rights issues in an attempt to prevent their abuse. SEBI said it has decided to set a maximum of 12 months’ tenure of that right. At present, SEBI Regulations and the public through a capital increase does not provide the option term. The controller added that the issuer or an issue of public also indicates how the funds collected could be used as the offer document and continuously. The controller has also decided to impose the minimum allotment size of Rs 5 crore to investors even in the number of shares, and the maximum amount permitted to anchor investors, in blocks. It does not specify what would be the tiles.

A government statement to Parliament last dashed the hopes of relief from tax on securities transactions (STT). Junior Finance Minister SS Palanimanickam Wednesday, November 23, 2011, said the government has no proposal to reduce the tax on securities transactions (STT). It has been speculated that the government reduce the budget of the STT 2012-2013, in order to increase volumes in the stock falls. Palanimanickam said in a written reply to Rajya Sabha that the income of the tax on securities transactions fell by nearly 18% to Rs 2960 crores during the first six months of the current fiscal period last year.

Corporate profits have been weak. Combined net income of a total of 3866 companies fell to 36.1% in the RS 67,424 crore is a growth of 20.5% of sales in the RS 1142463 crore in Q2 September 2011 over Q2 September 2010 .

Food price index rose by 9.01% and the index of fuel prices increased by 15.49% at 12 years in November 2011, government data Thursday, 24 November 2011 showed. In the previous week, food and fuel inflation rate of 10.63% and 15.49% respectively. The price index for primary articles rose 9.08%, compared with an annual increase of 10.39% a week earlier.

In recent weeks the government has taken some steps to encourage foreign investment. E ‘increased the amount of bonds that foreigners can hold and the amount of their debts, may be held from 5 billion dollars each, to $ 15 billion and $ 20 billion. The Union Council of Ministers has recently approved pension checks that are expected to be a provision was added to allow foreign pension fund management company to maintain up to 26% of Indian joint ventures, non-zero today.

The Reserve Bank of India (RBI) Tuesday, November 22, 2011, relaxed the rules for foreign investors in debt funds for infrastructure, allowing buyers to purchase bonds issued by these funds. Foreign investors can now buy bonds in local or foreign currency debt issued by infrastructure funds, provided they are kept for three years, the Reserve Bank of India, said in a statement. Under the general guidelines for the infrastructure fund launched in June this year, a fund can be constituted as a trust or partnership. Foreign investors have been allowed to invest in infrastructure debt funds that have been created as a trust.

The central bank also announced that foreign investors other than non-resident Indians to invest a total of $ 10 billion of such assets. Limit of $ 10 billion includes $ 25 billion cap on foreign investment in the infrastructure sector, securities, or the financing of infrastructure businesses.

RBI on Wednesday, November 23, 2011, eased regulations on foreign borrowing by Indian companies to raise the ceiling on the total cost of some of these loans in a move that could reduce rated companies more easily tap offshore funds. Local businesses can now remove the external debt of the total variance of 3.5 percentage points over London Interbank Offered Rate, or Libor, for foreign loans with a maturity of between three and five years, said the Reserve Bank of India, in an opinion. The previous ceiling was 3 percentage points above Libor. The ceiling of the cost of borrowing with a maturity of over five years, but remains the same at 5 percentage points over Libor, the statement said.

The cost of new ceiling will be applied immediately, and will be valid until March 31, 2012. RBI also noted that all funds raised through, for example, foreign loans must be brought to India immediately, unless intended for wide use.

The RBI is Wednesday, November 23, 2011, loosened the rules for currency swaps hedging the company, removing the upper limit of the net supply of foreign exchange market, the bank may increase as a result of this exchange. The move will help banks to sell more foreign exchange contracts to foreign companies debt, to help them cope with the volatility of currency markets.

Monetary policy has a limited role in the fight against food price pressures in India, but this measure can not be justified even if the food inflation persists, the central bank governor said Tuesday, November 22, 2011. A lasting solution to the pressure of food prices in a bid response for agricultural production and productivity, improved management of supply chain and determine the appropriate framework of incentives for producers and consumers, D Subbarao said, according to a copy of his speech in a lecture published by the Reserve Bank of India.

Subbarao said that the provision of measures to meet the growing demand for high protein foods, have been insufficient. Food prices were hovering at their highest level for several months due to the persistent demand of the growing middle class is increasingly consuming higher protein food such as milk, fish and meat, the price offsetting falls in other commodities.

RBI announced an increase of 25 basis points in its policy rate is key. repo rate to 8.5% by mid-year monetary policy October 25, 2011. The central bank lowered its GDP for the current fiscal year to March 2012 to 7.6% against 8% previously. But he kept his projected inflation rate in March-end of 7%. RBI said that the sequence of expected inflation indicates that inflation will start to fall in December 2011 (January 2012 version), then continue on the path to a stable 7% in March 2012. It is expected to moderate further in the first half of 2012-13. It reflects a combination of movements in commodity prices and the overall impact of tighter monetary policy. Also, in moderating inflation expectations is likely to have a positive impact.

Most Asia stocks fell on Friday as European leaders to calm investor fears that the crisis in the euro zone could trigger a credit crisis. The key benchmark indices in China, Hong Kong, Indonesia, Malaysia, Singapore and South Korea were reduced by 0.39% to 1.05%. The key benchmark indices in Taiwan and Japan increased by 0.11% and 0.10% respectively.

HSBC preliminary manufacturing in China reached a low of 32 months in November 2011, with readings signal the sector is now in decline. Purchasing Managers Index printed at 48 on a scale of 100 points, which turned from a slightly expansive reading of 51 in October, data showed on Wednesday, November 23, 2011. The index provides a non-governmental perspective on how China’s economy is performing.

HSBC economist Qu Hongbin said the data implied that industrial production slows down the rate of annual growth of 11% to 12% in the coming months at the center of the cooling of domestic and foreign demand. However, he said there was little information to propose a significant reduction was taking place in China.

U.S. markets closed on Thursday held 24 November 2011, the Thanksgiving holiday. U.S. markets are open for a half day today, November 25, 2011.

Fitch Ratings said late Monday, November 21, 2011, which would conclude a review of the sovereign credit ratings of the United States in late November, in light of the failure of Congress to reach an agreement Super committee bipartisan federal debt reduction. Fitch referred to his earlier statement in August that the failure of the ideal committee to reach agreement could result in a negative rating action – probably a review of the rating outlook to negative, indicating a greater likelihood 50% decrease over the next two years. He said a reduction of one first class was possible but less likely.

S & P confirmed that it will keep its AA + credit rating to the U.S. after the government stripping her top grade AAA, August 5, 2011. Moody has maintained its AAA rating from the United States with a negative outlook.


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