1)Addressing India’s concerns over certain provisions in the United States Congressional legislation on the nuclear deal, President George W.Bush assured New Delhi that the new law made no changes in fuel supply commitments or the terms of the 123 agreement. Signing the bill into law at a ceremony in the White House, Mr. Bush said, “the bill I Sign today(on Wednesday) approves the 123 Agreement I submitted to Congress and establishes the legal framework for that agreement to come into effect.”
2)In almost identical statements by various chambers, industry has suggested that the Government should inject Rs 1,00,000 crore as fresh funds by way of reduction in the CRR(cash reserve ratio) and the repo rate to infuse adequate liquidity in the economy and there- by ensure India’s insulation from the global financial meltdown.
CORPORATE / INDUSTRY
3)Elecon Engineering Company Ltd, a major manufacturer of material handling equipments, industrial gears and transmission products, has secured three orders worth Rs 51.74 crore from Techpro Systems, Chennai and SAIL-Durgapur Steel Plant, Durgapur.
4)With an order book of e7.5 billion(Rs 48,750 cr) that would keep it busy up to and through most of 2010, the multinational Wartsila Corporation expects to come through the international financial turmoil relatively unscathed though it is keeping a close watch on developments, according to the company’s President and CEO, Mr Ole Johnson.
5)Engineering goods manufacturer Siemens Ltd has set up a new, wholly owned subsidiary company to tap the potential in the Indian rail transportation sector. The move comes in the wake of Siemens acquiring land at Aurangabad to establish a facility to manufacture rolling stock, including coaches for trains and metros.
MONEY & BANKING
6)The Reserve Bank of India is likely to take further measures to ease the current liquidity problem, say analysts and bankers. The recent cut in CRR, which will come into effect from October 11, may not have much impact as RBI continues to sell dollars to support the rupee and the foreign institutional investors continue to sell in the equity market, they said. Bankers are looking for another cut in CRR or a decrease in the statutory liquidity ratio, which is now at 25 per cent. As RBI’s primary aim is inflation control, a repo rate cut may not happen in the near term.
7)Banks have begun pushing up deposit rates anticipating a further tightening of liquidity, despite the Reserve Bank’s 50 basis points cut in the Cash Reserve Ratio(CRR). The latest bank to hike deposit rates is the public sector Canara Bank. It hiked deposit rates close to 10.5 per cent for maturities above 500 days. Deposit rate hike come even as the CRR cut was expected to release at least Rs 20,000 crore into the banking system from October 11. Bankers said that the rate hikes were in view of the tightening of liquidity, with the beginning of the peak season.
8)Worried investors in Indian equity markets hoping for a turn of sentiment in the global markets following coordinated rescue efforts by governments across the globe had little to cheer them on Thursday. They were looking for some stability back home when the ex- changes open for trading on Friday.
9)Trusts may soon be allowed to park their funds in listed shares or private sector debt instruments that have investment grade rating from credit rating agencies. The Union Cabinet has given its nod for the introduction of a Bill in the coming session of Parliament to enable funds owned by trusts to be invested in securities(or class of securities) to be specified by the Central Government.
10)The Bombay Stock Exchange will start trading in normal timings from tomorrow, as the sun outage ended yesterday.The re-scheduled trading timings was effective till October 8. Today being a holiday on account of Dussehra, normal trading session wil resume from Friday.
MERGERS & ACQUISITIONS
11)DESPITE the global meltdown, India Inc has successfully finalised overseas mergers and acquisitions(M&As) worth $26 billion till the end of September 2008. In an assessment report released on Thursday, Indus View Advisors, which advises multinational corporations on business opportunities in India noted, “Cash-rich Indian companies are doing much better than their global counterparts in M&As. As against acquisitions worth $8 billion in India by oveseas investors, India Inc made acquisitions worth $14 billion. The consultancy said Infrastructure sector dominated the deal street with transactions worth $12 billion, followed by power, oil and gas that saw M&As worth $5 billion.
12)Commodities market regulator Forward Markets Commission (FMC) is keen on options trading in commodities, a top official said. “Presently, forward markets regulations do not permit options trading. (However) those kinds of contracts are not only beneficial to corporates, but also to producers and farmers,” the FMC Chairman, Mr B.C. Khatua, told reporters on the sidelines of a conference on Thursday.
13)Gold slipped on Thursday as investors cashed in gains that took the metal to a nine-day high in the previous session, with a recovery in equity markets attracting investment back to stocks. Spot gold was quoted at $887.60/890.10 at 1329 GMT, down from $906.50 in late New York trade on Wednesday. Earlier it touched a session low of $877.65.
14)Breaking previous records gold on Thursday surged to an all-time high of Rs 13,850 per 10 grams in the bullion market in New Delhi as investors scrambled to hedge risks from the equities market. Besides a rush of investors moving away from the stock markets buying for festival navratras and marriage season too pushed up demand for the precious metal which rose by Rs 450 per 10 grams to close at this record level. The previous high of Rs 13,650 per 10 gram was recorded on July 15.
BUSINESS PROCESS OUTSOURCING
15)Tata Consultancy Services(TCS) and Citigroup(Citi) have reached an agreement for TCS to acquire all of Citi’s interest in Citigroup Global Services Ltd. (CGSL), the India-based captive business processing outsourcing (BPO) arm of Citi, for all cash deal of about $505 million.
16)Tata Consultancy Services(TCS) will not only retain each of the more than 12,400 employees currently working with Citigroup Global Services Ltd(CGSL), but also scale up hiring for its BPO operations, a top company official said.
17)THE global financial crisis triggered by fall by financial institutions in the United States is expected to cash its shadow over Indian software firms in the coming months. Whether the crisis will short circuit the desi IT circle severely, is doubtful even though some short-term effects are likely to impact a few firms. Acknowledging that the current global crisis may crimp demands, National Association of Software and Services Companies(NASSCOM) President Som Mittal noted: “There will be short to medium-term impact, which we define as three to four quarters. I won’t be surprised if the numbers are tempered down.” In July the association had forecast revenue growth between 21 per cent and 24 per cent to about $50 billion in the year to March 2009. But Nasscom warns that industry could miss its revenue target of $60 Billion target in 2009-10.
18)THE Bank Japan (BOJ) pumped a record 4 trillion yen into the Tokyo money market on Thursday for the 17th consecutive day of emergency operations to facilitate interbank borrowing. The BOJ conducted its biggest ever single-day liquidity provision in the money market as credit conditions remained tight amid concerns over the course of the market despite coordinated interest rate cuts by six central banks in North America and Europe on Wednesday.
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