Wednesday, October 15, 2014

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Posted by BAMMIDI NAGESWARARAO at 10/15/2014 10:45:00 am 0 comments

Illegal trade: ex-Tata Finance MD barred from market

OUR BUREAU


 http://www.thehindubusinessline.com/markets/illegal-trade-extata-finance-md-barred-from-market/article6501050.ece?homepage=true
Posted by BAMMIDI NAGESWARARAO at 10/15/2014 10:32:00 am 0 comments

Saturday, October 11, 2014

WORLD Growth worries NOW A STORY TO SCRIPT@ ALL TIME Highs...!!!


Growth worries slam stocks, oil, emerging markets

Investors have scrambled to reduce big bets in stocks and other risky assets after reaping big gains from a rally in major world equity markets that has only seen brief interruptions in the past three years
Reuters  |  New York  
 Last Updated at 00:05 IST
An index of global equities fell to a seven-month low and oilslumped to a four-year low on Friday as worries about weak worldwide economic growth continued to take a toll on investor confidence.

Most major markets declined about one per cent on Friday, though the US benchmark S&P 500 index was slightly higher in early afternoon trading, while the tech-heavy Nasdaq saw the biggest losses on Wall Street.

Investors have scrambled to reduce big bets in stocks and other risky assets after reaping big gains from a rally in major world equity markets that has only seen brief interruptions in the past three years.

Assets tied to expectations for improved growth have been hit by a recent raft of weak indicators from Europe and China at a time when other big economies, including Japan and Brazil, face their own hardships and as the US Federal Reserve is expected to reduce monetary accommodation in the coming months.

"In a vacuum of policy response, investors are selling first and asking questions later," said Jim McDonald, chief investment strategist at Chicago-based Northern Trust Asset Management, which has about $924 billion in assets under management.

"It smells like there is a high degree of involvement from systematic traders, rather than fundamental traders. The magnitude of the move has been disproportionate to the change in the fundamentals," he said.

The Dow Jones industrial average rose 47.59 points, or 0.29 percent, to 16,706.84, the S&P 500 gained 1.19 points, or 0.06 per cent, to 1,929.4, while the Nasdaq Composite dropped 31.28 points, or 0.71 per cent, to 4,347.06.

In a sign of increased volatility, the CBOE Volatility Index , or VIX, the market's favoured gauge ofWall Street anxiety, touched a high of 22.06 on Friday, its highest intra-day level since December 2012, as more investors paid up for protection against further declines.

Concerns about global growth have hit oil prices hard, though they pared losses in midday trading. Brent crude oil fell to $89.79 a barrel, after touching its lowest level since December 2010 at $88.11. US November crude was flat at $85.72.

The risk aversion has boosted buying in safe-haven government debt. Lipper data shows US-based taxable bond funds attracted $12.7 billion in inflows for the week ended Wednesday, a one-week record, while US equity funds saw $6.7 billion in outflows, with most coming from exchange-traded funds.

The yield on the US 10-year Treasury note fell to 2.307 per cent on Friday, the lowest level since June. The 30-year Treasury bond was up 4/32 in price to yield 2.3124 per cent, the lowest level since June 2013.

The MSCI all-country world index was down 0.9 per cent after hitting its lowest level since March, while the pan-European FTSEurofirst 300 index ended down more than 1 per cent.

The dollar index, which tracks the greenback against six major currencies, was up 0.31 per cent at 85.788. Against the euro, the dollar was up 0.45 per cent at $1.2633. The dollar traded flat against the yen at 107.84 yen.

Though it was still trading near four-year highs, the dollar index was on track to end a record-long rally with its first weekly fall in three months.

The Federal Reserve, later this month, is set to wind down the asset purchase programme that has been credited with boosting markets over the past two years. Many observers doubt the recent stimulus measures unveiled by the European Central Bank will make up for the Fed program.

A string of dismal data from Germany and other large euro zone economies in recent weeks has fed anxiety over a possible recession in the region, while the jury is still out on the ECB's proposed policy response.

Some investors have been speculating that the ECB will be forced to launch a sovereign bond-buying program, styled on the Fed's quantitative easing.

China's shares ended down on Friday as investors remained cautious ahead of September economic data due next week.

Economists expect the economy to have grown at its weakest pace in more than five years, according to a Reuters poll.

Euro zone bond yields bounced off record lows after top Federal Reserve officials hinted at an interest rate rise in the middle of next year, reversing some bets for a longer period of near-zero rates.
Posted by BAMMIDI NAGESWARARAO at 10/11/2014 09:36:00 am 0 comments

Friday, October 10, 2014

NIFTY OUTLOOK GLOOM FOR NOW! BUT VERY BRIGHT FOR FUTURE...!!!

Sunday, 20 July 2014

AN ADVANCE PREDICTION...NIFTY OUTLOOK

PHENOMENAL RISE&HIGHs but A Denial for NOW….
The Indian markets have performed stupendously, like a race against all ODDs and against all emerging markets. We are the best performing Indices YTD or for the quarter. The Rise is so phenomenal that no-body expected but few could CASH the opportunity. Now many new entrants are making inquiries and many more are looking as a decent opportunity to make HUGE money to meet their DREAMS.
The fact is that, since January-14, Nifty rose by 20%, Mid-Caps by 30% and Small caps by 55%, some Individual stocks rose by 400-700% from their LOWs. The hype generated now is due to change in the Government, a market friendly team at the top. But the fact is that No-body could SELL the National property via LIBERALIZATION for no reason, nor for a simple cause. The National growth based on immediate requirements and will be judged by prioritising/striking a right balance between “NECESSITY & COMMERCIALIZATION”. The Future is GOOD as huge investments will take place and the results will come in due course of time.
As far as the Stock Markets rise is concerned, a dead cheap stocks are at a historic low was one of the major reasons for FIIs relentless investments. The Global markets are also encouraging and FREE Supply/HIGH Liquidity is driving the markets for NOW. Very few are working on the REAL worth for the paper but relying on the PROJECTIONS. The Nifty is POISED for touching 9000+ as experts are working on the next 3-year EARNINGS and P/E that could safely take us above the above said number. I am not pessimistic but play a realistic role for valuing the Available Opportunity. The main reason for Nifty may seek SOUTHWARD JOURNEY because of looming DROUGHT, Poor Investments made by the CORPORATES in the Preceding/Previous 2-3 years, so NO earnings Surprise by the top companies.
So, the scenario is GLOOM in the Short-term, however the POLICY push can give some bounce but for the next ONE year will be very challenging. The Nifty stocks are moving up but the UN-Winding is a concern. The rise from here may not be that much sharp or serious, from here 2-Ups and 4-5 Downs. Because the FUTURE is promising, on any DEEP cut/ steep fall BULLs take charge to make a comeback to take away the Retail Investors most of the STOP-LOSSES.
THE BLOOM and GLOOM story…..THE MOMENTUM IS HIGH….
THE NIFTY MAY TOUCH 8785-8850 RANGE; BUT VERY LIKELY, IN THE SHORT-TERM LOW MAY  TOUCH 7000, NO SURPRISE EVEN IF IT TOUCHES 6600-6400 RANGE
THE BANK-NIFTY MAY TOUCH 20100-22000 RANGE; IN THE SHORT-TERM LOW MAY  TOUCH 12500-800, NO SURPRISE EVEN IF IT TOUCHES 10100-10300 RANGE
THE RELIANCE MAY TOUCH 1450-1550 RANGE;IN THE SHORT-TERM LOW MAY  TOUCH 801-811, NO SURPRISE EVEN IF IT TOUCHES 759-736 RANGE
THE ONGC MAY TOUCH 620-650 RANGE; IN THE SHORT-TERM LOW MAY  TOUCH 311-321, NO SURPRISE EVEN IF IT TOUCHES 270 RANGE
THE SBI MAY TOUCH 3850-3950 RANGE, IN THE SHORT-TERM LOW MAY  TOUCH 1920-1950, NO SURPRISE EVEN IF IT TOUCHES 1450-1430 RANGE
THE ICICI MAY TOUCH 2130-2080 RANGE; IN THE SHORT-TERM LOW MAY  TOUCH 1180-1220, NO SURPRISE EVEN IF IT TOUCHES 970-950 RANGE
THE RELCAPITAL MAY TOUCH 950-1050 RANGE;IN THE SHORT-TERM LOW MAY  TOUCH 440-415, NO SURPRISE EVEN IF IT TOUCHES 330 RANGE
THE RELINFRA MAY TOUCH 1080-1150 RANGE; IN THE SHORT-TERM LOW MAY  TOUCH 520-540, NO SURPRISE EVEN IF IT TOUCHES 440 RANGE
WE CAN EXTEND AND READ MORE NUMBERS… BUT THE DENIAL IS RIDING HIGH EVEN IN MY MIND…
PLS DON’T BUY NOW UNTIL NIFTY TOUCHES 7250-80 RANGE, BUT THE ACTUAL BUYING IN QUALITY STOCKS SHALL EMERGE FROM 7000 ONLY. THOSE WHO ARE COMPULSIVE, SHALL TAKE A STOPLOSS ROUTE RATHER THAN HOLDING FOR LONGER…THW WAIT MAY BE 3 YEARS…!!!!!!!!!!!!!!!!!!!!!!!!!!!!!
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Posted by BAMMIDI NAGESWARARAO at 10/10/2014 02:12:00 am 0 comments

Wednesday, September 24, 2014

A boon for Zinc....!!!

Mine closures – a boon for zinc

NAVEEN MATHUR


September 23, 2014:  
Zinc is used principally for galvanising iron and more than 50 per cent of metallic zinc goes into galvanising steel.
Zinc is the primary metal used in making American pennies and rising prices of this bluish-white metal this year have forced the US Mint to reduce manufacturing costs to offset higher prices.
Zinc prices have soared to three-year highs in 2014 on intensifying deficit in the global market as one of the biggest mines, Century open pit in Australia, is due for closure next year and the delayed start of its Dugald River project. MMG’s Century mine is expected to run dry in 2015, removing about 5 per cent of global supply.
Several large, aging mines are also scheduled to close next year as miners need higher prices to justify the cost of finding and developing new sources of metal. Miners may not produce enough zinc to meet the needs of steel companies and coin-makers until 2018. Owing to this, zinc production is expected to fall short of demand this year for the first time since 2007.
According to the Lisbon-based International Lead and Zinc Study Group, zinc demand is up 7.7 per cent globally in the first six months of this year to 6.8 million tonnes. As a result, users are drawing on stockpiles of the metal to make up for production shortfalls.
Supplies of the metal in LME-licensed warehouses fell to a three-and-a half- year-low in July, and are down 15 per cent this year. The warehouses contain enough zinc to meet 19 days of demand, down from 24 days at the start of the year.
Chinese factor

Moreover, China’s MMG Ltd, owner of the world’s third-biggest zinc mine, said the global deficit in the metal had increased faster than expected, spurred partly by demand growth in China to rust-proof steel for cars. Chinese demand had picked up as companies sought galvanising technology, following a push by the International Zinc Association to tout the benefits of coating steel with zinc to prevent rust.
As a result of this, Chinese imports of refined zinc have jumped by 39.3 per cent through July, given the solid underlying demand growth, up about 7 per cent in 2014, boosted by strong auto production (+9.4 per cent year to date), rising content of galvanised steel in cars to prevent rust.
After a surplus of six years, supplies of the metal would be in deficit this year, coinciding with world major economies struggling for a breakout from recession, propelled by forecasts of annual demand growth of five-six per cent.
The Zinc study group has estimated that demand for zinc exceeded output by 248,000 tonnes in 2014 through July’14, compared with a 15,000-tonne production surplus in the same period a year earlier.
Prices to rise

Strong demand growth at a time when a number of big mines are approaching the end of their lives will lead to increase in physical deficit and a rundown in stocks at registered LME and Shanghai warehouses, thereby boosting prices further.
For the coming months, prices will continue to surge as some of the world’s largest zinc mines run dry just amidst spurt in demand.
In addition, MMG Ltd, which owns Century, had planned to open a new mine in Australia next year, but it’s being delayed back to late 2016 due to technical issues. This will fuel supply concerns.
However, higher shipments from China, the world's top consumer and producer of refined zinc, in the fourth quarter as tight credit crimps domestic demand at a time of increased imports to LME warehouses in Asia could cap LME zinc prices, which gained around eight per cent this year.
LME Zinc (CMP: $2,222) prices can head higher towards $2,500/tonne, while zinc on the MCX (₹135.5) can head higher towards ₹152/kg.
The writer is Associate Director-Commodities & Currencies, Angel Commodity Broking. Views are personal.
(This article was published on September 23, 2014)

Posted by BAMMIDI NAGESWARARAO at 9/24/2014 08:05:00 am 0 comments

Tuesday, September 23, 2014

BANKS SEE GOOD FUTURE...!!!

Here's why banks will rally againBroking firm Jefferies says Indian financial system is now flooded with the kind of liquidity witnessed in 2005-07 and 2009-10Shishir Asthana  |  Mumbai  
 Last Updated at 18:22 IST


Recently announced non-food credit and GDP data suggested that India is on the path of a credit-less growth. While some businesses are starving for low-cost funds, banks are flushed with liquidity, prompting them to cut down interest rates on deposits.

None of this seems to bother analysts who continue to remain bullish on the sector. Morgan Stanley in a report titled ‘Correction: The upcoming second leg of bank rallies’ says Indian banks have rallied nearly 42% on a year-to-date basis mainly on account of growing confidence in the Indian economy which would in-turn improve asset quality. But the next leg of stock performance will be fundamental driven asloan growth picks up.

Morgan Stanley says that historically bank stocks have rallied in two cycles. Indian banks are currently in the transition phase between the two cycles. The first leg is driven by expectations around better asset quality. The second and more sustained leg is driven by a loan growth pick-up, which sets an earnings upgrade cycle in motion. Banks now have the liquidity to fuel the next round of growth.
Broking firm Jefferies says Indian financial system is now flooded with the kind of liquidity witnessed in 2005-07 and 2009-10. Ample liquidity and lower overnight rates are also showing up in falling risk spreads - BBB-minus bonds are now at their lowest levels. Both commercial paper and certificate of deposit markets are showing signs of life and no liquidity stress.
Several banks have cut home loan rates. If allowed, this trend will be seen across products and in banks' Base Rate sooner than later. Banks, it seems, are waiting for a signal from the central bank to announce a rate cut. As reported in Business Standard in a recent interaction between members of the banking community and RBI, lenders have asked the central bank to cut repo rate to spur loan growth.

RBI Governor has however ruled out any reduction in interest rate in the month-end monetary policy announcement. Analysts are expecting a rate cut from the central bank to take place sometime in 2015. A Bank of America Merrill Lynch report says that a supportive Balance of Payment situation and a stable rupee – though on account of low gold and oil prices should see the central bank reducing interest rates by around 75 basis points in 2015.

Banks however, are now facing a problem of plenty. Liquidity is at such high levels that the amount the banking system needs to borrow from the Central Bank through Liquidity Adjustment Facility (LAF) and other windows (term repos, Marginal Standing Facility or MSF) has declined, reaching near zero, says Jefferies. Without a significant RBI intervention, it is quite possible that the net liquidity balances slip back in to the negative territory or a surplus.

Morgan Stanley says that a capex cycle is needed for loan growth to go back to more than 20 per cent levels, from the current levels of less than 10 per cent. This looks tough in the near term and might happen over the next 1-2 years. However, Morgan Stanley feels retail to be strong and SME (small and medium enterprises) working capital demand to pick up – helping system loan growth to trend to 15% by FY15. This will drive the second leg of this rally.

Posted by BAMMIDI NAGESWARARAO at 9/23/2014 12:12:00 am 0 comments

Monday, September 22, 2014

PSU-BANKS NEED --$ 37 bn

State-run banks in India need $37 bn in fresh capital to meet Basel III: Moody's

Press Trust of India | Mumbai | Updated: Sep 22 2014, 17:03 IST
Public sector banks in India will need to raise up to $37 billion over the next 4-5 years to meet Basel III compliance norms, credit rating agency Moody's said today.
The estimate is based on assumptions that there would be a moderate recovery in the Indian economy and a gradual decline in the non-performing loans from the current levels.
"Our rated public-sector banks in the country will need to raise Rs 1.5-2.2 trillion, (USD 26-37 billion) between FY15 and the full implementation of Basel III in FY19," Moody's said in a report titled, 'Indian banks could need USD 26-37 billion in external capital for Basel III compliance'.
A significant part of the required capital-- Rs 800-900 billion (USD 13-15 billion) -- could be in the form of additional tier I (AT1) capital.
The rating agency rates 11 public sector banks in the country, representing 62 per cent of net loans in the banking system.
Basel III raises the minimum required levels for both total tier I capital to 7 per cent and common equity tier I (CETI) capital to 5.5 per cent. They will also need to meet a capital conservation buffer in order to pay dividends.
"Public sector banks barely meet current minimum capital requirements, and we anticipate that they will find it difficult to raise capital quickly in the current environment," Moody's vice-president Gene Fang said.
According to Moody's, low capital levels remain a key credit weakness for the public-sector banks.
Fang said weak asset quality has depressed profitability and internal capital generation, leaving public-sector banks reliant on periodic capital injections from the government.
"With Prime Minister Narendra Modi's administration looking to reduce the budget deficit, the amount available for such injections is not likely to grow," he added.
Moody's said banks may tap the equity markets to raise capital, but with still-low bank valuations, banks could struggle to raise the required amount.
http://www.financialexpress.com/news/staterun-banks-in-india-need-37-bn-in-fresh-capital-to-meet-basel-iii-moodys/1291618
Posted by BAMMIDI NAGESWARARAO at 9/22/2014 11:18:00 pm 0 comments
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