1)After three years of intermittent discussions, India and Pakistan on Monday decided on the modalities of trade across the Line of Control through Jammu and Kashmir. The two sides are now understood to have agreed on opening the Srinagar-Muzaffarabad and Poonch-Rawalkot road routes to trade. Like the bus services that connect the two parts of the state divided by the LoC, the decision on trade is another initiative in a series of confidence building measures(CBMs) that should help increase people-to-people contact, particularly within divided Kashmir.
2)COMPANIES developing infrastructure projects can now borrow more abroad. The government on Monday relaxed external commercial borrowings(ECBs) norms and allowed infrastructure companies to borrow up to $500 million a year for rupee spending in India, a five-fold hike over the current limit of $100 million.
CORPORATE / INDUSTRY
3)Tata Steel has picked up a 7.29 per cent stake in Australia-based Riversdale Mining through Tata Steel Global Minerals Holdings, an indirect subsidiary of the steel major. Tata Steel already has a relationship with Riversdale Mining. Sources close to the development said, Riversdale was a growing company and the investment made sense for Tata Steel.
4)Hyderabad-based Gati has embarked upon a $100 million(Rs 450 crore) revamp exercise to transform itself from a cargo company into a supply chain and logistics major. The company is also focusing on expanding its international business.
MONEY & BANKING
5)The rupee failed to hold on to intra-day gains against the dollar on Monday but closed tad firmer tracking the stock market movement. Volumes in the foreign currency market were also thin, said dealers. But the injection of liquidity by central banks globally helped the market sentiment, said forex dealers. The rupee opened at 45.55 and touched a high of 45.22/23. It, however, closed lower at 45.44/45, against Friday’s close of 45.83.
6)NINE of the country’s largest commercial banks including State Bank of India, ICICI Bank and HDFC Bank have exposure to the tune of $420 million(Rs 2,000 crore) in the US financial giants which collapsed recently. The government feels banks other than SBI would suffer a loss of around Rs 600 crore due to the ongoing crisis.
7)BANKRUPT foreign investment banks like Lehman Brothers and others, who have exposures in India’s realty sector, may get some reprieve from the government. Mandatory three-year lock in norms for all foreign direct investment may be relaxed on a case-to-case basis for these I-banks if they apply to FIPB.
8)The country’s largest lender, State Bank of India(SBI), has drawn up an aggressive blueprint, which marks possible acquisitions, to expand its operations overseas. A senior executive of the bank’s international banking division told FE that SBI is vetting a series of acquisition proposals in a bid to penerate an unexplored market that has a high density of non-resident Indian population.
9)After staying lacklustre in the first half of the day, key equity indices lost ground in the mid-afternoon trades on selling pressure in the capital goods, power and IT stocks on Monday. Investors were apprehensive over concerns of the US government’s exact plans of the rescue package of $700 billion to the ailing financial system. The Sensex lost 47.36 points or 0.34% ending the day at 13,994.96 points, while the S&P CNX Nifty closed down 22.20 points or 0.52% at 4,223.05 points.
10)AMID the pall of gloom, there seems to be some relief. Percentage of delivery-based trades on the bourses has shown some improvement, and now accounts for over 30% of all trades. Yet, market observers feel it is hardly any cause for celebration. They attribute the trend to a sharp rise in selling by foreign institutional investors, and an overall decline in trading volumes.
11)The much awaited currency futures at the Bombay Stock Exchange (BSE) will kick start from the first week of October said Jagdish Capoor, chairman of BSE at sidelines of one of the conferences in Mumbai. BSE received an in-principle approval from the markets regulator on August 28 which was followed by mock sessions for the members including brokers, Indian institutions investors and individuals. BSE will be second exchange to offer the exchange traded currency futures after National Stock Exchange(NSE), while MCX is still to announce the formal date for the launch of currency futures.
12)Principal Mutual Fund launched the Principal Emerging Bluechip Fund on Monday. The new fund offer, which opened for subscription on Monday, will close on October 10. The open-ended equity scheme seeks to achieve long-term capital appreciation by investing in equity and equity-related instruments of midcap and small-cap companies.
13)Taurus MF has announced the launch of a one-month fixed maturity plan (Series I) from September 23. The plan envisages investing in high-quality debt instruments such as bank certificate of deposits, a press release issued stated.
14)Gold climbed in Europe on Monday, reversing earlier losses in Asia, as the dollar weakened and fears spread that a $700 billion US plan to stabilise the financial sector may not succeed. Spot gold was trading at $872.50/874.50 an ounce at 0940 GMT, up from $871.15 an ounce at the nominal New York close on Friday. Gold prices soared nearly 15 per cent last week as fears over the outlook for the financial sector exploded.
15)Mentha oil futures today rose on the Multi Commodity Exchange on increased buying by traders, supported by pick-up in demand in the physical markets. Mentha oil, for the near-month September contract gained 1.10 per cent at Rs 628.20 per kg at the MCX counter. The contract recorded business volume of 227 lots. Similarly, October and November contract were up by one per cent each at Rs 643.50 and Rs 654.90 a kg, recording business volume of 253 and 43 lots respectively.
16)Pepper futures market, which opened lower moved up later on Monday and hit the ceiling at close on good domestic buying support. The bear operators were pressurising some of the brokers to liquidate and that led to the fall in the morning. However, as buyers became active the prices started moving up, trading sources told Business Line. October contract shot up by Rs 366 a quintal to Rs 13,140.
17)Turmeric prices today was up in futures trading on buying on speculators, largely triggered by a likely rise in demand in the spot market due to festive season. The most-active October contract surged one per cent at Rs 3,830 a quintal on the National Commodity and Derivatives Exchange, clocking business of 1,670 tonnes.
18)Real estate companies such as Unitech, Peninsula Land, HDIL and Future Capital,the financial services arm of Future Group, are in talks with investors including some leading private equity funds for raising investments for their projects, after the collapse of Lehman Brothers, whose third party fund had promised investments in these property companies’ projects, according to industry sources.
19)Reputed real estate developers in Mumbai and many parts of the country have started selling their commercial real estate which includes office, retail and hotels, rather than leasing them out. The developers are ready to sell properties at a rate which is seen attractive by the buyers today. The appetite is to purchase, build and sell off projects, with the prospect of gaining immediate returns, according to experts.
20)Unperturbed by the ongoing upheaval in the financial world, two global telecom majors – the UAE-based Etisalat and Italy-based Telecom Italia – are set to acquire 49 per cent stake in new generation telecom operators – Swan Telecom and Unitech Telecom, respectively.
21)Telecom services provider Tulip Telecom on Monday announced that it has bagged the state-wide area network project worth Rs 95 crore in Madhya Pradesh. Tulip will establish the network on the build- own-operate & transfer(BOOT) model. It will deploy, manage and operate the entire network for a period of five years.
22)Private telecom service provider Bharti Airtel has launched an upgrade for SMS services, which permits subscribers to search for content using SMS platform. The move allows users to search using their mobile phones, but without internet browsers.
23)WHEN Goldman Sachs and Morgan Stanley gave up their independent investment banking status, it gave reason for Indian IT vendors to smile. As commercial banks, they now need to follow more regulations and this could mean more business for software service providers.
24)Hyderabad-based Infotech Enterprises Ltd is close to acquiring a European company operating in the auto engineering space, for an estimated value of $30-40 million. Infotech Enterprises – which last year raised $75 million from General Atlantic – has already inked in- to a letter of intent with the target firm and hopes to conclude the acquisition deal by December-end.
25)THE Wall Street that shaped the financial world for two decades ended last night, when Goldman Sachs and Morgan Stanley concluded there is no future in remaining investment banks now that investors have determined the model is broken. The Federal Reserve’s approval of their bid to become banks ends the ascendancy of the securities firms, 75 years after Congress separated them from deposit-taking lenders, and caps weeks of chaos that sent Lehman Brothers into bankruptcy and led to the rushed sale of Merrill Lynch to Bank of America.
26)Mitsubishi UFJ Financial Group(8306.T), Japan’s largest bank, said on Monday it planned to take a stake of up to one-fifth in the US investment bank Morgan Stanley as part of a strategic alliance. Mitsubishi UFJ Financial Group said in a statement on Monday it would buy 10-20% of the common stock of Morgan Stanley.
27)The Group of Seven finance ministers and central bank governors are maintaining “heightened close co-operation” and pledged on Monday to take necessary actions to safeguard the international financial system. In a statement released by the US Treasury, the G7 finance ministers and central bank governors said they held a conference call to discuss global financial markets and welcomed “extraordinary” US actions to take illiquid assets off of bank balance sheets.
28)Crude oil futures rose to a two-week high on Monday, fueled by Washington’s financial rescue plan, crimped supply and fresh evidence of growing world demand. Light, sweet crude for October delivery, which expires on Monday, was recently up 2.2 per cent, at $106.87 a barrel on the New York Mercantile Exchange, after hitting $107.80, the highest price since September 8.
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