1)India and Russia on Monday agreed to further cooperation in the nuclear sector during Russian President Dmitry Medvedev’s maiden visit to the country in December. The Foreign Ministers of both countries also signed a protocol outlining consultations between diplomats over the next year.
2)Prime Minister Manmohan Singh emphatically told the nation there was no place for fear because of global financial uncertainty, and assured bank depositors their savings were “entirely safe”. He spelt out the government’s stance on the liquidity crisis, offering a frank assessment that growth would slow down “temporarily”, but that inflation would also come down.
3)The Finance Minister, Mr P Chidambaram, on Monday said that the Indian economy is expected to grow close to 8 per cent in fiscal 2008-09 despite the global financial turmoil. “Despite, the global slowdown, we hope that the Indian economy would grow close to 8 per cent.
CORPORATE / INDUSTRY
4)INDIA’S largest drugmaker Ranbaxy is now a subsidiary of Japanese drug major Daiichi Sankyo. The Tokyo-based company on Monday bought 21.9% stake from the promoters and another 11% through allotment of preferential shares at Rs 737 per share. This is in addition to the 20% stake that Daiichi bought from the company’s shareholders through its open offer. These three transactions take the Japanese company’s stake in Ranbaxy to 52.5% making it the undisputed owner of the Indian company.
MONEY & BANKING
5)SOME good news, finally, It’s just a matter of time before home loan interest rates start coming down. Since the cash crunch has turned bankers risk-averse, they may wait a while to figure out whe- ther the worst is over. But at the end of the day, they will have little choice but to cut loan rates. An unexpected interest rate cut by the Reserve Bank of India on Monday was a strong signal to banks that they should go out and lend instead of sitting on cash or parking the money in government bonds. Having raised money at high rates to battle an unprecedented liquidity crunch, banks will prefer to cut their deposit rates first before lowering interest on loans to consumers and corporates. But they know that the one percentage point(100 basis points) cut in the repo to 8% – the rate at which banks borrow from RBI – marks the beginning of a dovish monetary policy, with inflation becoming less of a concern. The RBI had last cut interest rate in 2004.
6)THE rupee breached the 49-mark against the dollar on Monday, even as the unexpected repo rate cut by the Reserve Bank of India(RBI) boosted sentiment in the stock and bond markets. Heavy dollar demand by importers as well as nationalised banks for a defence-related purchase caused the rupee to fall to a low of 49.20 during the day. It finally ended the day at 48.97/98 against the dollar, weakening from the Friday’s close of 48.88/89.
7)CANARA Bank has reported a 32% year-on-year rise in net profit for the second quarter(Q2) ended September 30,2008. Net profit stood at Rs 529 crore against Rs 402 crore driven by a 29% year-on-year rise in net interest income in Q2 of the current fiscal.
8)THE Tata Group is learnt to have started negotiations to buy AIG’s 26% stake in the life and non-life joint ventures, Tata AIG Life and Tata AIG General, respectively. The discussions between the parties has gained momentum with AIG in the process of selling its Asian operations, barring India.
9)ICICI Prudential Life Insurance, the country’s leading private life insurer, has posted a growth of 56% for the half-year ended September 30,2008, garnering total received premium(new business and renewal) of Rs 6,726 crore as against Rs 4,311 crore during the corresponding period in FY2008. Renewal premium, one of the key indicators of long-term sustainability of the business,showed strong growth of 90% and stood at Rs 3,423 crore for first half of FY2009.
10)Gains in banks after the Reserve Bank of India announced a 100-basis point cut in the reporate and bargain buying in technology shares led Indian shares to close higher Monday, snapping a three-day fall. However, the BSE’s 30-stock index pared part of its early gains on profit-taking, as investors trimmed their positions amid the current uncertainty prevailing in the US. The index ended up 247.74 points, or 2.5 per cent, at 10,223.09. It traded between 10,023.28 and 10,538.05 during the session. It had risen 5.6 per cent in intra- day trade. On the NSE, the 50-stock S&P CNX Nifty gained 48.45 points, or 1.6 per cent, to 3,122.80.
11)In what can be seen as another closer step towards bringing in strict measures against short selling, or a possible ban, the Securities & Exchange Board of India(Sebi) has sent out a communication to the foreign institutional investors(FIIs), disapproving overseas lending or borrowing exerting selling pressure in the cash market in India.
12)Mutual funds(MFs) heaved a sign of relief today after the Reserve Bank of India(RBI) announced a repo rate cut of 100 basis points. Repo rate is the rate at which RBI lends to banks. “The sentiment will definitely improve,” said Arvind Chari, fund manager-fixed income at Quantum Mutual Fund.
13)CLOSE on the heels of providing an emergency credit line to cash starved mutual funds(MFs), financial regulators have announced another move to provide fund houses more relief. The securities and Exchange Board of India(Sebi) has announced that fund houses will now have more leeway in valuing bonds on their books. This will not only bring in more efficiency while calculating net asset values of funds, but also help fund managers get a better price while exiting their investments in times of redemptions.
14)The Forward Markets Commission(FMC) hopes the ban on trading of eight commodities on exchanges will go in November. “We will take a call after studying the situation in mid-November and recommend suspension of the ban on four commodities(rice, wheat, urad and tuar),” Mr B C Khatua, Chairman of FMC, said.
15)Gold was firmer on Monday as a recovery in oil prices boosted interest in the metal after last week’s sharp price fall, but retreated from earlier highs as the dollar pared losses against the euro. Spot gold was quoted at $788.40/790.40 an ounce at 1326 GMT, up from $781.70 an ounce late in New York on Friday. Earlier it touched a session high of $808.20.
16)Gold prices bounced back by Rs 150 per ten gm on the bullion market on Monday on fresh buying interest. Standard gold (99.5 purity) rose by Rs 150 per ten gm to Rs 12,735. Pure gold(99.9 purity) also rose to Rs 12,800 from Rs 12,640. Silver ready(.999 fineness)moved up by Rs 90 per kg to Rs 18,065 from Rs 17,975.
17)Pepper futures market witnessed high volatility on Monday as both sellers and buyers were active and good quantity was said to be traded. Prices of all the contracts moved up on buying support. October contract went up by Rs 9 a quintal to Rs 12,551. November and December deliveries increased by Rs 166 and Rs 160 a quintal to Rs 12,748 and Rs 12,890 respectively.
18)With the global economic meltdown taking its toll on the Indian real estate sector, the residential sector market has started witnessing a significant dent in demand, while demand for commercial properties nationwide, has started dipping by 70% to 80%. Retail developers too are holding on to their expansion plans and are seeing a dent of over 50% in demand, according to international property con- sultants and developers.
19)Ansal Housing & Construction has launched a residential project worth Rs 140 crore, called Ansal town, at Alwar in Rajasthan. This project is spread over 42 acres and is initially offering plots for Rs 7-25 lakh. Later, built-up villas and apartments will be introduced in the township, the company has informed the BSE.
20)Swarnanjali Projects Private Ltd launched its first realty project Swarnanjali Greens’ at Kottur, near the Hyderabad International Airport, Shamshabad. The project, launched by Mr C V S K Sarma, Principal Secretary, Municipal Administration, Hyderabad, would have 200 homes each on 200 square yards plots. According to Mr Syed Ahmed Rauf, Director, Swarnanjali Projects, “The project is coming up near to fully developed commercial and residential surroundings at reasonable price and easy scheme of 40 month instalments.”
21)THE father of the Pentium chip, a breakthrough chip for Intel, Vinod Dham, believes that Indian outsourcers will be the beneficiaries of the current crisis in the US. Mr Dham, who is now a venture capitalist like many other successful tech entrepreneurs of his time, says the stories of gloom and doom are not entirely unfamiliar to him. “After the dotcom bust, everybody said Indian IT growth was over. But look where they are now. The same thing is likely to repeat itself,” he said.
22)Having burnt fingers due to high exposure in the US and UK markets, Indian IT sector sees huge opportunity emerging in Japan. Currently, Japan contributes a mere 2% to the total revenues of the Indian IT sector at $1.1 billion. The total offshoring IT market size of the country is around $10.8 billion. That leaves a lot of room for growth for the Indian IT players considering that India is the second largest outsourcer for Japan after China, which has a 50% share of the market.
23)European banks lined up on Monday to tap state rescue packages designed to ease the financial crisis and there were signs that institutions were beginning to lend to each other again. European shares rose by more than two percent on optimism the financial sector crisis might ease and US shares were also expected to open higher. The rate banks charge each other for dollar and euro loans fell, suggesting that confidence in dealing with other lenders was returning to the market.
24)Crude oil rose for a second day on signs that the Organisation of Petroleum Exporting Countries may cut output to halt a 50 per cent drop in prices since July. OPEC may pare production by 1 million to 2 million barrels a day in stages at an October 24 meeting to stabilise prices, said Mr Chakib Khelil, the group’s President. Crude oil for November delivery rose 69 cents, or 1 per cent, to $72.54 a barrel at 11:03 a.m. on the New York Mercantile Exchange.
25)FEDERAL reserve chairman Ben Bernanke told the US Congress Monday a fresh round of government stimulus is a good idea because there’s a risk the country’s economic weakness could last for some time. Bernanke’s remarks before the House budget committee marked his first endorsement of another round of energising stimulus, some- thing that Democrats on Capitol Hill have been pushing.
26)SHARES in ING Group rebounded more than 20% at the start of trading Monday, after the Dutch government threw the bank and insurer a e10 billion($13.4 billion) life line to shore up its capital position. The move, which will temporarily make the state, ING’s largest share- holder, was announced late Sunday and intended to prevent the comp- any from becoming the latest victim of the global financial crisis.
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