Rs 20,000-cr NPAs ...No takers --PLEASE...!!!

No takers for Rs 20,000-cr NPAs as banks, ARCs spar over valuationsShayan Ghosh | Mumbai | Updated: Sep 06 2014, 14:09 ISTClose to Rs 20,000 crore of non-performing assets (NPAs) that banks want asset reconstruction companies (ARCs) to pick up have found no takers as the two continue to spar over valuations. ARC senior executives that FE spoke to said that 25 banks have put assets on sale in the past month or so.The head of a large ARC said reconstruction companies were not ready to buy assets unless banks offered them loans at attractive reserve prices. “Lenders should realise that since we have to pay 15% upfront now compared with 5% earlier, the reserve price should be lower. However, banks appear to be unwilling to drop the value of the assets," he observed.Last month, Reserve Bank of India (RBI) had asked asset reconstruction companies (ARCs) to increase the mandatory upfront investment in security receipts (SRs) to 15% from the earlier 5% to ensure ARCs have 'more skin in the game'.Eshwar Karra, chief executive officer at Phoenix ARC, said he expected the prices of security receipts (SRs) that are issued when an NPA is 'sold' to come down. For their part, banks say they are not in a position to take a big hit in terms of lowering the value of the asset. “It may be true that the ARCs have to spend more upfront but we cannot reduce the price,” said an executive director at a public sector bank. ARCs, however, maintain the reserve prices should be more practical, considering the increase in their upfront payments.“Some banks have set their reserve price at a level equal to that of the size of the loan,” said Siby Antony, MD & CEO, Edelweiss ARC.Owing to a jump in NPAs, banks have of late been selling very aggressively to ARCs to clean up their books and this has prompted RBI to step in. “A spurt in the activities of asset reconstruction companies (ARCs) driven by banks’ efforts for cleaning up their balance sheets, calls for a closer look at the extant arrangements between ARCs and banks,” RBI said in its financial stability report.Though the ARC industry has been dominated by ARCIL, which was India's first ARC, other players like Edelweiss ARC and JM Financial ARC have become more aggressive of late.According to sources, Edelweiss issued SRs worth Rs 9,000 crore in FY14 whereas ARCIL had Rs 4,500-crore SRs in FY14 and JM Financial ARC had Rs 2,500 crore in their bag. In FY14,ARCs bought assets worth Rs 22,000 crore, sources said.Phoenix asset reconstruction company, sponsored by group companies of Kotak Mahindra group has receipts of Rs 1,750 crore in FY14, sources added.

http://www.financialexpress.com/news/no-takers-for-rs-20000cr-npas-as-banks-arcs-spar-over-valuations/1286062

INDIA ECONOMIC GROWTH UP-TICK- a “dead cat bounce”...?

FROM THE VIEWSROOMDead cat bounce

It is absurd to say that our economy has 

recovered 

September 5, 2014:  

The optimism over first quarter growth figures seems misplaced. The 5.7 per cent growth in April-June is a result of election spending rather than a pick-up in investment. The enhanced growth in construction, power, manufacturing, hotels and restaurants seems to bear this out. The demand generated in these labour-intensive sectors would have resulted in higher off-take of industrial goods. Besides, the election campaign would have generated its own demand for bulbs, gensets, fittings, vehicles and numerous other goods. Power generation is likely to have improved as a pre-election measure. (Strangely, the Q1 core sector growth of 4.1 per cent does not really bear this out.) At the same time, the deceleration in the financial sector, including realty, affirms an election trend — that funds might have been pulled out of real estate to fund poll campaigns.
In other words, we might be seeing what economist Nouriel Roubini in the context of the US economy earlier called “dead cat bounce”. An enduring revival would have been backed by a turnaround in investment.
Gross fixed capital formation has, in fact, dipped as a share of GDP from 28.7 per cent to 28.6 per cent. Government spending as a share of GDP has shown a sharp rise from 12.9 per cent to 13.4 per cent, perhaps a result of election spending on law and order. So, where is the pick-up in investment?
Strangely, economists predict a 6-6.5 per cent growth in 2014-15, against 4.7 per cent in 2013-14, despite our being in the midst of a monsoon-deficient year. Europe and the US continue to struggle. The Finance Minister seems serious about containing the fiscal deficit at 4.1 per cent of GDP with a view to keeping inflation and interest rates in check; this could peg back demand.
The policies of the new government, as well as the mysterious “confidence fairy” (to borrow Paul Krugman’s expression), could drive investment in asset classes such as equities and land. The wealth effect could give rise to little more than a demand for luxury goods.
Whether the liberalisation of land, environment and labour laws leads to greenfield investment over the next few years, in a climate of global recession, remains to be seen.
Deputy Editor
(This article was published on September 5, 2014)
http://www.thehindubusinessline.com/opinion/columns/dead-cat-
bounce/article6383866.ece?homepage=true

A SRINIVAS

Too much trading leads to mistakes...!!!

In volatile markets, too much trading leads to mistakes Santosh Kamath of Franklin Templeton Investments India talks about the debt market opportunity Lisa Pallavi Barbora 

First Published: Mon, Sep 01 2014. 05 51 PM IST

Santosh Kamath, managing director, local asset management, fixed income, Franklin Templeton Investments India, is unperturbed by the near-term volatility in yields and prefers to remain invested to see a view play out over a period of time. We caught up with him to talk about the debt market opportunity and the challenges that fund managers face. He is not too enthused about frequent trading in bonds. Investing in corporate bonds, he says, requires a lot of in-depth research by the fund management team which can help investors understand the credit risk better. 

Over the last year or so, bond yields have been volatile. Did you have to change your strategy accordingly? We don’t believe in too much trading and churning. When a market is too volatile, it may look easy to make returns by navigating the volatility through buying and selling; but you may end up making more mistakes. For example, last July, we were very negative on the currency. We didn’t know that it would go to the levels of Rs.68 per dollar. Nevertheless, we were sitting on low maturity (in our funds), and that stayed for a long time, till the benchmark yield went up to levels of 8.60-8.70%. We don’t think that strategy needs to be changed just because markets are volatile. We need to take a medium- to long-term view. As variables such as inflation, crude prices and fiscal deficit are turning positive now, we are long on bonds and will remain so for some time. We don’t want to move too much in the interim. Which parts of the market have opportunity today? We have to look at the yield basket. Clearly, the yield on corporate bonds is likely to be better than on government bonds. Depending on how much the spread is, it becomes more or less attractive. 

Typically, the “normal” level should be 70-80 basis points between an AA (rated) bond and a government bond. If the spread increases to 130-140 bps, it’s more attractive to own corporate bonds. (One basis point is one-hundredth of a percentage point.) This will happen when markets are volatile, since liquidity for corporate bonds is not high. When markets go through a volatile phase, spreads tend to widen. Secondly, during times of fear around economic growth and corporate earnings, the spreads can widen. Lastly, when there is selling by, say, mutual funds, even if everything is normal, the spreads can go up. At present, both corporate bonds and government securities (G-secs) are looking attractive. Till some time back, corporate bonds were looking much more attractive as spreads were high. But now that G-sec yield has moved up, the spread has narrowed, balancing both segments. What are the challenges of managing a portfolio that is predominantly focused on corporate bonds? The market itself is big. The entire credit space in the banking industry will be about Rs.50-60 lakh crore. 

Unfortunately, liquidity in the corporate bond space is not good. Hence, any negativity tends to impact yields sharply. So, you can run a fund in this space only if you get enough retail investors; with corporate investors you should be cautious playing this theme as they can be volatile. Credit risk can also have an impact. When the economy is doing better and the equity markets are doing well, companies are able to raise funds easily. When things are not good, even if companies have good assets, they would find it difficult to get good buyers. A year ago, the credit risk was high. But now it’s come down. The two big risks are liquidity and credit. Liquidity risk can be handled by encouraging more retail money in the fund, and credit risk by ensuring you lend to good quality companies. 

The good part is that most ratings typically move with a lag—credit rating normally goes up six to nine months after a company starts doing well. If you are an active investor and understand that a company’s fundamentals are going to change, you can actually lock in a higher yield. Over time, when the rating goes up, you can benefit. (But) it requires a lot of research and meeting company managements to identify good credit. When you talk to distributors and investors, how do you decide which product is suitable? There are two ways to tranche all debt schemes, on interest rate risk and credit risk. Interest rate risk means you have short, medium and long maturity. If you can take volatility and stay invested for long, you can look at long maturity products; else, stick to short and medium maturity funds. So the first question the investor has to answer is how long are you willing to wait and are you okay with the volatility. The second question is, whether you want a very high credit, AAA kind of portfolio, or if you are okay with AA exposure, too.

All our funds are mapped like this, and the investor can take her pick. Investors are beginning to understand the difference between benchmark yield and corporate bond yields. Over the past year, performance has been quite varied across categories, which has shown them that different funds can behave differently. When managing a large corpus, how do you personally bring discipline to your everyday life? It really depends on the person. However, a lot also depends on the organization you work for. If the organization believes in long-term fund management, then it is likely to give its portfolio managers extra time to implement their strategy. If the organization understands what you are trying to do, then life becomes easier. Some may want performance every month or every three months, then obviously things become harder to manage.

As a company, we understand investments and their long-term nature. For many asset management companies, what matters is the mad rush to increase assets under management (AUM). If the entire objective is to be the No.1 or No.2 in terms of AUM, the behaviour expected from the sales and the investment teams will be very different. So, the way an organization thinks can have a big impact on employees. First Published: Mon, Sep 01 2014. 05 51 PM IST

Read more at: http://www.livemint.com/Home-Page/Zhvq9olv5r1W81bP8gNdeJ/In-volatile-markets-too-much-trading-leads-to-mistakes.html?utm_source=copy

Purchasing Manager Index (PMI) and it stood at 50.6

Services sector slows for second month in a rowSHISHIR SINHA
Business expectations have deteriorated slightly: HSBC reportNEW DELHI, SEPT 3:  

What could be seen as reality check after above 5 per cent growth in the first three months, a survey by HSBC indicated a slowdown in the growth of services sector in India. But the good news is that index is still 50.Result of survey is known as HSBC India Service Purchasing Manager Index (PMI) and it stood at 50.6 in August as against 52.2 in July. The index is calculated on the basis of response received from 350 purchasing managers of private companies. These companies comprise hotels & restaurants, transport & storage, financial intermediation, renting & business activities, post & telecommunication and other services. Index above 50 reflects expansion while below 50 means contraction.

Since, it was announced on September 1 that manufacturing PMI (based on response from 500 companies) stood at 52.4 in August against 53 in July, it also affected composite output index. This came down to 51.3 in August from 53 in July. While this indicated a slowdown in output growth across the private sector, it remained consistent with a moderate expansion in activity.“Output growth weakened from July at both services and manufacturing companies, although manufacturing production increased at the second quickest pace since February, 2013,” a HSBC statement said. On services specifically, it mentioned that the latest PMI data indicated a slowdown in growth of Indian service sector activity in August, as new business expanded at a weaker pace. Employment remained stable, while future expectations regarding activity growth fell to the weakest level since September 2013.

Since, the index was above 50, it mean expansion for fourth consecutive months. Among various sectors, the Post & Telecom firms showed best growth, while Hotel & Restaurants reported reduction. However, both the sectors did not reduce the manpower, while other service sector did.

“Services activity is once again turning down following a swift post-election uptick suggesting that an improvement in reform momentum is needed to lift sentiments in the sector,” Frederic Neumann, Co-Head of Asian Economic Research at HSBC said while adding that, on positive side, weaker activity has softened inflation indicators within the survey.(This article was published on September 3, 2014)

http://www.thehindubusinessline.com/economy/hsbc-

services-sector-pmi-falls-to-506-in-

august/article6375769.ece?homepage=true

India's bright GDP

India's bright GDP growth just a small step in long road to sustained revival

Reuters | New Delhi | Updated: Sep 03 2014, 09:59 IST

Optimism that sunny growth figures herald an economic revival in India is probably misplaced - in fact there is little hard evidence to support the idea that Asia's third-largest economy is heading for a broader and sustained rebound anytime soon.

India's economy grew 5.7 percent in the June quarter compared with a year earlier, the strongest pace in 2-1/2 years, accelerating from 4.6 percent in the March quarter thanks to a rebound in industrial activity.

But the encouraging headline numbers masked the deeper malaise gripping the economy, which is being hobbled by slack consumption, weak business investment, creaking infrastructure and painfully slow structural reforms, economists say.

"The uptick in GDP growth was mainly driven by front-loading of government expenditure," says Izumi Devalier, an economist with HSBC in Hong Kong. "A curtailment in expenditure will make it challenging to sustain this pace of growth."

Prime Minister Narendra Modi, who won power in May's general election with a promise of "good times", trumpeted the growth data on a visit to Japan, saying it had "generated huge positive sentiment".

And economists at Citi declared after the GDP figures that the recovery was a matter of when, and not if: "While there is plenty of debate on pace and timing, India is on its way back to 7 per cent growth and 6 per cent inflation."

But there is a difference between sentiment and ground reality. Based on the evidence at hand, Modi's goal of scripting a broader, lasting upturn appears some way off.

Much of the growth in the last quarter came from robust government spending, the pace of which could slow down as Finance Minister Arun Jaitley seeks to stick to this year's ambitious fiscal deficit target of 4.1 percent of gross domestic product.

A pickup in private spending could help offset the slowdown in government spending. But stubborn inflation, which at nearly 8 percent is too high for the Reserve Bank of India to cut policy rates, and weak employment are hurting consumers.

The HSBC purchasing managers' index (PMI) for manufacturing in August showed no improvement in employment or inflation, clouding the consumer outlook.

A late monsoon and coal supply crunch that has depleted fuel supplies to just six days of forward cover at India's thermal power stations could undermined rural spending and constrain output at energy-intensive businesses.

CONSUMER CONFIDENCE

Consumers power nearly 60 percent of the economy, so getting them to spend more is essential for India to end its longest spell

of sub-5 percent growth in a quarter of a century.

It needs at least 8 percent annual growth to create enough jobs for the 200 million Indians who will be reaching working age over the next two decades, the largest youth bulge the world has ever seen.

However, without an overhaul of India's strained public finances, stringent land acquisition laws, chaotic tax regime and rigid labour rules, economists say, it will struggle to consistently grow beyond 7 percent.

Modi's record as a leader of Gujarat has fuelled hopes among investors he can carry out these changes. But in his first 100 days in office, the prime minister has shown little appetite for structural reforms and has focused more on cutting bureaucratic discretion and speeding up decision making.

Shilan Shah, an analyst at Capital Economics, says there is no alternative to more serious and deeper reform because piecemeal measures collectively do not amount to much.

A slowdown in infrastructure output growth in July and the manufacturing sector last month suggests further moderation in industrial activity, which could drag down economic growth for the current quarter.

Worryingly, capital investment, which barely grew in the past two years, has still to show tangible signs of an upturn. Although capital investment rose 7 percent in the last quarter over a year earlier, it fell 7.4 percent from the previous quarter.

In a poll by the Economic Times last week, 46 percent of the respondents in a poll of 50 chief executives said they were watching for improved economic conditions before making planned investments that would help revive growth.

Last year, bumper harvests boosted sales of tractors, motorbikes and other consumer goods in rural areas, helping to compensate for weaker urban demand.

In a sign of things to come, tractor sales at India's largest utility vehicle maker Mahindra and Mahindra fell 1 percent year-on-year between April and August compared with 22 percent growth during the same period a year ago.

"We think that Q2's (April-June quarter) pickup in growth might be as good as it gets for the Indian economy for some time," said Shah of Capital Economics.

http://www.financialexpress.com/news/indias-bright-gdp-growth-just-a-small-step-in-long-road-to-sustained-revival/1285139/2

Sensex could reach 45,000'...!!!!

'Projects worth $ 60 bn can be put back on track by govt; Sensex could reach 45,000'

PTI | New Delhi | Updated: Sep 02 2014, 20:59 IST

Government is expected to revive projects worth USD 60 billion, around 45 per cent of all the stalled projects, a move that could lead to a sustainable improvement in GDP and market rally, says a Societe Generale report.

In its optimistic scenario, a much higher rate of stalled project revival and faster than expected reform implementation, India's GDP growth rate could potentially reach 8.5-9 per cent in five years and the Sensex could potentially reach 45,000 by December 2016.

According to the global financial services major, concerns around the stalled projects have already peaked, indicating that the worst may be over.

"Our base case scenario is that the government will be able to revive projects worth USD 60 billion," the report said, adding that "this should lead to a sustainable improvement in GDP growth and corporate earnings and to a structural rally in the Sensex".

On the other hand, in a pessimistic scenario the GDP growth rate could stay close to current levels (around 5-5.5 per cent) over the next five years and the Sensex could potentially fall to 20,000 by December 2016.

The report further noted that if the government is able to revive the long-term investment cycle, the current bull run in Indian markets may well outlive the term of the current government in office (beyond 2019), and we can expect much higher GDP growth rates and Sensex targets.

The report noted that the biggest concern for India is also its biggest opportunity.

"We note that the biggest concern is about stalled projects which we identify as the biggest opportunity for the government to immediately kick start the investment cycle," the report said.

An analysis of all the projects announced since 2000 across India, where implementation has been stalled for various reasons shows that the total value of these projects stood at a staggering USD 134 billion, about 7 per cent of GDP.

http://www.financialexpress.com/news/projects-worth-60-bn-can-be-put-back-on-track-by-govt-sensex-could-reach-45000/1284956--------------------=================------------------------

EFFORTS TO PUT ECONOMY BACK ON TRACK IS A GOOD SIGN TO INDIA BUT THE MARKETS ARE DRIVEN BY THE FII INVESTMENTS AND SOME DRIVE MADE BY THE HNIs. THE RETAIL PARTICIPATION IS VERY LOW AND THE PUNTERS NOT ABLE TO OFFLOAD...SO THE NEWS AND RECOMMENDATIONS....THE MARKETS ARE POISED FOR GOOD TIMES BUT NOT NOW, THE PRICES ARE FULLY PRICED IN ...

WHO WILL GET WHAT IF SO BODY BUYS MARUTI AT THIS PRICE, LT, SUN PHARMA, CIPLA, AURO PHARMA....THE LIST IS LONG...PLS DON'T BUY NOW, THE NIFTY WILL TOUCH 6700-6900 RANGE COMFORTABLY, WITH OUT MUCH SUPPORT...

THE US QE-TAPERING, INTEREST RATE HIKES, GEO-POLITICAL UNCERTAINTIES AND OTHER NEGATIVE NEWS WILL EMERGE...IT IS JUST ON IT'S WAY,

US MARKETS SAW A SERIOUS SELL OFF  A WEEK BACK, SO IS THE OTHER MARKETS, IN INDIA ALSO, SERIOUS SELLING TOOK PLACE IN THE SECOND WEEK OF AUGUST, BUT TO COVER THE HAPPENINGS, THE MOVE IS CRAWLING....

THE HEADLINES WILL SEE THE STORIES OF OTHER HAPPENINGS....WAIT, WAIT WITH MONEY, OR TRADE AS OTHERS ARE DOING...NO INVESTMENTS AT THESE LEVELS...

Indian stock markets to double in 4 years

Indian stock markets to double in 4 yearsfe Bureau | Mumbai | Updated: Sep 02 2014, 06:04 ISTWhile the Nifty soared past the 8,000 mark on Monday and stocks hit lifetime highs on the back of encouraging economic data, experts believe there’s room for more upside, reports fe Bureau in Mumbai. A BofA-ML report said markets are likely to double from current levels in the next four years, tracking the trajectory of corporate earnings in the same period. India’s GDP growth for the three months to June came in at 5.7%, the fastest rise in 10 quarters, up from 4.6% in the January-March period.“Our bullishness is driven by our view that the earnings have turned the corner and we will see earnings doubling over the next four years. We think market returns could mirror earnings growth,” BofA-ML wrote on Monday.The brokerage believes that while market returns have outpaced earnings growth in the past, in the current rally earnings and markets will move in tandem on account of higher valuations. “In the four years from FY02-06, earnings more than doubled for the Indian markets and for the six years to FY08 earnings tripled. During the same period markets tripled between FY02-06 and went up 5x between FY02-08. In this cycle, market returns far exceeded earnings growth since we started with a low PE of 7x and hence saw the PE re-rating as well. We are presently at PE levels of 15x already and hence market returns to mirror earnings growth,” the report added.

http://www.financialexpress.com/news/indian-stock-markets-to-double-in-4-years/1284701

Nifty crosses the 8000 mark...be Cautious...!!!!

5 reasons to be worried about the bull run

Even as Nifty crosses the 8000 mark, a look at what could derail the bull run for investors

Shishir Asthana  |  Mumbai  

September 2, 2014 Last Updated at 10:29 IST

Nifty has crossed the 8000 mark on news of GDP growth touching 5.7 per cent, a number last seen nine quarters back. Market pundits are now talking of Nifty touching 10,000 by next year’s budget. Though there is a consensus on the direction of the market there are reasons to look out for in the short to medium term. The move ahead might not be as smooth as it was in the past.

Here are five reasons why an investor needs to be worried about the current bull run in the market.

1) There is little doubt that the direction of economic growth has changed but the same is yet to reflect in the numbers. Recently announced first quarter numbers are yet to reflect the buoyancy of the market. However, the management sentiment has clearly improved from dismal to hopeful. It is this sentiment rather than the numbers that are getting captured in stock prices. Analysts are not extremely bullish on the September quarter growth numbers. 

2) GDP numbers are not as good as they look. Though the broad GDP number has shown a growth of 5.7 per cent, the main reasons for the uptick is higher election and social spend as well as higher power production. During months leading to elections, state governments ensured lower power outages to score brownie points. Both social spending and government related electricity purchases are back to the long term average. It is highly unlikely that the 5.7 per cent growth will be repeated in the near future.

3) Reining in the fiscal deficit will prevent government spending going forward. This will affect growth and earnings of companies. Further, continued high inflation will prevent the central bank from reducing its interest rates thus adding to the headwinds.

4) The present growth rate has been without any support from the banking system. Non-food credit offtake has in fact shown a contraction. With the series of CBI raids on banking officials, lending from public sector banks have again slowed down. Public sector banks were the main lenders to the small and medium sector enterprises. Unless credit growth picks up, there is little scope for sustainable growth.   

5) The September quarter corporate numbers will be viewed more closely by the market to see for signs of growth. On the economic front too, the broad growth numbers will be compared to the June quarter growth numbers. However, September quarter will not have the benefit of government spending. As for electricity, the quarter will reflect the continued poor state of affairs on the coal front which are being tested on account of not so sufficient monsoon. July core sector growth at 2.7 per cent as compared to a 7.3 per cent growth in June shows the possibility of poor numbers in the current quarter.

To add to these problems will be the flow of liquidity, especially from FIIs, which can change direction if interest rates in the US rises, as is being expected in the near future.

http://www.business-standard.com/article/markets/five-reasons-to-be-worried-about-the-bull-run-114090200121_1.html

MONSOON MANTRA...GOOD..!!!

Kharif sowing down on poor monsoonPTINEW DELHI, AUG 29:  With sowing of kharif crops almost completed, the total area planted to all summer crops including rice and pulses remains lower at 96.62 million hectare from the year—ago due to poor monsoon.While sowing of pulses, oilseeds, coarse cereals, cotton, sugarcane and jute has completed, the planting of rice would end by next month.As per data released by the Agriculture Ministry, the total area under all kharif crops stands at 96.62 million hectare as of today, as compared to 99.9 million hectare in the kharif season last year.“Barring rice, sowing is almost completed in the kharif season. Rice and cotton area is higher than last year. The acreage under other crops is lower as compared to last year but still higher than normal area of last three years,” Agriculture Commissioner J S Sandhu told PTI.Some good spell of rains is required during vegetative and reproduction stage of these crops, he said, adding that rainfall deficit has affected sowing operations this season.Thanks to pick in up monsoon rains, area planted to rice has increased marginally to 35 million hectare from 34.97 million hectare, while cotton acreage has gone up to 12.25 million hectare from 11.16 million hectare in the review period.However, area sown to pulses remained lower at 9.54 million hectare, compared to 10 million hectare a year—ago.Oilseeds acreage is down at 17.22 million hectare from 18.67 million hectare in the same period.Lower acreage under pulses and oilseeds is a cause of concern as the country is heavily dependent on import of lentils and edible oils.As per the data, area planted to coarse cereals is also lower at 17 million hectare, as against 19 million hectare in the year—ago period.Sugarcane acreage is down at 4.71 million hectare from 5 million hectare in the review period.
(This article was published on August 29, 2014)http://www.thehindubusinessline.com/industry-and-economy/agri-biz/kharif-sowing-down-on-poor-monsoon/article6363090.ece.............THE CHALLENGE NOW IS TO MAINTAIN THE RAINFALL RATE IN SEP-OCTOBER...THE MARKETS ARE ENJOYING THE EXPORT SUPPORT OFFERED BY USA AND EUROPE...BUT THE EU SLOWDOWN AND DAX STEEP FALL FROM HIGHs CAN POSE SOME CHALLENGES GOING FORWARD...