Bulls take a breather, key indices slip 3 percent
Bulls take a breather, key indices slip 3 percent
MUMBAI, Aug 8 (IANS): Though the benchmark indices touched a 14-month high this week, continued selling pulled them down three percent from their last weekly close, as the government voiced concerns that the revival of the economy may be hampered due to deficient rains.
Bourses across the world touched highs not seen in 9-10 months, mainly backed by improved corporate earnings and a positive job market report in the US.
However, the 30-share sensitive index (Sensex) of the Bombay Stock Exchange (BSE) fell 510.07 points or 3.26 percent over previous Friday’s close and ended trade at 15,160.24 points.
The broader S&P CNX Nifty of the National Stock Exchange (NSE) followed the Sensex, moving down 3.34 percent from its last weekly close to end at 4,481.4 points.
Both Sensex and Nifty had touched a 14-month high Monday.
Mid-sized companies in terms of market capitalisation did no better with the BSE’s midcap index closing 2.47 percent lower. However, smaller companies lost less with the BSE smallcap index going down 0.19 percent.
Data with markets watchdog Securities and Exchange Board of India (SEBI) showed that foreign funds were net buyers during the week, having bought scrips worth $154 million.
Indian equities started the week with a bang, with both indices rising smartly. While the Sensex ended Monday with gains of 253.92 points or 1.62 percent at 15,924.23 points, the Nifty moved up a similar 1.6 percent to 4,711.4 points.
Consolidation set in Tuesday, with the bulls stalling their buys and booking profits. The Sensex ended trade on a low, moving down 93.25 points or 0.59 percent to 15,830.98 points. The Nifty, too, shut shop in the red at 4,680.5 points, down 0.66 percent.
Investors started cautious Wednesday, with both Sensex and Nifty languishing in the red for most of the day. It, however, recovered to shoot up into the green, an hour before close, only to give up sizeable gains and end slightly up.
The Sensex shut shop at 15,903.83 points, up 72.85 points or 0.46 percent, while the Nifty closed at 4,694.15 points, 0.29 percent higher.
Thursday saw some heavy selling in frontline stocks in the last trading hour, pulling down the Sensex 389.8 points or 2.45 percent to 15,514.03 points.
Similarly the Nifty shut shop in the red at 4,585.5 points, down 2.31 percent.
The selling continued Friday, as the Sensex closed down 353.79 points or 2.28 percent at 15,160.24 points. The Nifty shut shop in the red at 4,481.4 points, down 2.27 percent.
The top weekly gainers on the Sensex included Reliance Industries (up 2.2 percent), Wipro (up 2 percent) and Hindalco (up 1 percent).
Among top losers were Maruti Suzuki (down 8.6 percent), ITC (down 7.9 percent), Hero Honda (down 7.9 percent), Hindustan Unilever (down 7.5 percent), and DLF (down 7.3 percent).
In other Asian markets, the benchmark index of the Tokyo Stock Exchange touched a 10-month high this week, while European shares rose to a nine-month high Friday.
In the US, stocks rose as the government reported that job losses in July were far less than expected. Key indices like the Dow Jones Industrial Average and the Standard and Poor’s 500 closed near their respective 2009-highs Friday.
12 Goa mines near wildlife sanctuaries face closure
PANAJI, Aug 8 (IANS): Twelve mines, including one owned by Sesa Goa, face closure because of their proximity to wildlife sanctuaries.
Director of Environment Michael D’Souza directed the Goa State Pollution Control Board (GSPCB) through a letter dated Aug 6 to stop mines which “have not obtained any clearances from the statutory authorities”.
The list of mines includes Sesa Goa mines at Codli village, two mines operated by Shantilal Khushaldas Bros at Rivona, which do not have the required clearances and sanctions from the forest department.
Another mine belonging to Damodar Mangalji, which is also under investigation, is located in a lease area which is a protected site which has ancient rock carvings.
The administrative action follows an assurance given to the state assembly Thursday by Environment Minister Aleixo Sequeira that all mines near wildlife sanctuaries would be ordered to stop operations.
“The undersigned has assured the august house that in case alleged illegalities are found to be true, the department of environment will immediately ensure necessary action to stop all such activities,” Sequeira wrote in a note to the environment secretary a few hours after the assurance to the assembly.
“The note from the honorable minister for environment is self explanatory, along with it is a list of 12 mines which are operating without fulfilling the requisite conditions or without having obtained any clearances from other statutory authorities,” D’Souza has said.
The issue of illegal mining has been one of the main features of the monsoon session of the Goa legislative assembly. A high level committee appointed by the chief minister has also thrown light on several instances of illegal mining in the state.
The opposition has repeatedly alleged that several cabinet ministers were involved in illegal mining. Leader of opposition Manohar Parrikar had also alleged that nearly 18 percent of Goa’s mining exports were fed by illegal mining.
Indian firm to build eye centre in Addis Ababa
ADDIS ABABA, Aug 8 (IANS): Indian project development firm Overseas Infrastructure Alliance (OIA), involved in diverse projects in Africa’s second-most populous nation, will build an eye care centre in the premises of the Zewditu Memorial Hospital here as part of its community partnership programme. The project has been lauded by Ethiopia’s President Girma Woldegiorgis.
Speaking at the groundbreaking ceremony for the hospital, Woldegiorgis said close to 2.3 million blind people live in Ethiopia, out of which 1.3 million are totally blind. He said there was a severe shortage of health facilities and eye care specialists that offer medium and large scale services in the country.
Girma expressed gratitude to Indian Ambassador Gurjit Singh on behalf of the people of Ethiopia for encouraging OIA to help set up the facility. The establishment of the eye care centre shows the ever-increasing people-to-people ties between Ethiopia and India, he added.
Addis Ababa Mayor Kuma Demekissa said Menelik II and Ras Desta Damitew Hospitals are the only hospitals in the city that offer medium- and large-scale eye care services and the new centre will help add up to the service given in the city.
Gurjit Singh said that the hospital would be the second hospital from the Indian people after the Gandhi Memorial Hospital that was established some 60 years ago. He said the facility would boost Ethiopia-India friendship.
OIA chairman V.B. Soni said the company will construct a state of the art eye care centre, outpatient service with modern diagnostic facilities, minor and major operation theatres, inpatient services, and administrative offices. The two-storey opthalmology centre on 2,000 sq metres will also be equipped with modern diagnostic, clinical and office equipment and furniture, he said.
OIA is also participating in sugar production expansion projects in Ethiopia after the Indian government extended a $640 million loan for the project. Besides, it is also involved in the rehabilitation of the Ethiopia-Djibouti rail link.
We’ve rescued our economy from catastrophe: Obama
WASHINGTON, Aug 8 (IANS): Amid signs of recession nearing an end with job losses tapering off and unemployment falling for the first time in more than a year, President Barack Oba
ma took credit for rescuing the US economy from “catastrophe.”
“Today we’re pointed in the right direction,” he said shortly after the Labour Department Friday reported a net loss of 247,000 jobs in July, the fewest job losses since August 2008 with the unemployment rate surprisingly inching down to 9.4 percent.
“We’re losing jobs at less than half the rate we were when I took office. We’ve pulled the financial system back from the brink,” he said. “While we’ve rescued our economy from catastrophe, we’ve also begun to build a new foundation for growth.”
The Labour Department report also revised job loss in June lower-to 443,000 job losses from 467,000.
The unemployment rate fell to 9.4 percent from 9.5 percent in June, the first decline in that closely watched reading since April of 2008.Economists cited by CNNMoney.com expected unemployment to rise to 9.6 percent.
The unemployment rate fell even as employers continued to cut jobs because the Labour Department estimated there were 237,000 fewer people it counted as unemployed.
There was also plenty of bad news as the number of people unemployed for more than six months continued to rise, reaching nearly 5 million people, a record high.
The Labour Department also said that one reason for the declining number of job losses was because cuts had been so deep leading up to July that there were fewer workers to lay off during the seasonal shutdown that happens in some factories, such as those in the auto industry.
Since the start of 2008, 6.7 million jobs have been lost in the US Several economists said that while the report confirms other economic readings suggesting that the recession may be ending, it’s too soon to predict a sharp gain in jobs in the near term.
“The dawn of an economic recovery is here,” said Sung Won Sohn, a professor of economics at Cal State University Channel Islands, as cited by CNNMoney.com.
“The economy is in the process of bottoming, but the job market will lag behind. Businesses, which engaged in preemptive layoffs earlier, are not about to start hiring people.”
Robert Brusca of FAO Economics said he believes there is more strength in the job market than many people are willing to acknowledge. He said that the government may even report an overall payroll gain for August next month.
“There is nothing about these numbers that suggest it’s a fluke,” he said.
Obama appoints Indian-American to key commerce post
HOUSTON, Aug 8 (PTI): President Barack Obama has appointed Indian-American attorney Ro Khanna to a key post in the US Commerce Department, where he will work to open foreign markets to American technology.
32-year-old Khanna, a prominent attorney who specialised in intellectual property law at O’Melveny and Myers’ San Francisco office, was sworn in earlier this week as Deputy Assistant Secretary for domestic operations of the US and Foreign Commercial Service, International Trade Administration.
Among his duties will be to lead trade missions to countries like India and China.
“I look forward to working to strengthen American competitiveness, increase exports and create good-paying jobs here at home,” he said in a statement.
Khanna is expected to report to Francisco ‘Frank’ Sanchez, Obama’s nominee for Under Secretary for International Trade at the Department of Commerce. Sanchez is up for Congressional confirmation in the fall.
Khanna will oversee 109 US Export Assistance Centers operating in 47 different states.
His appointment by Obama is being seen by observers as reflection of the growing political clout of the Indian-American community.
Khanna’s Indian roots, observers say, will help advance US interests when it comes to difficult trade discussions with India.
Khanna, who was born in Philadelphia and earned his law degree at Yale University, has political roots reaching back to India.
His grandfather, Amarnath Vidhyalankar, spent four years in jail during the independence movement. After India gained independence in 1947, he became a Member of Parliament.
In 2006, Khanna was appointed by then-House Minority Leader Nancy Pelosi to chair the Indo-American Council for Democrats. And until recently, he chaired the Indo-American Council of Democratic Congressional Campaign Committee.
Khanna attended the University of Chicago, where he earned a Bachelor’s in Economics and did door-to-door campaigning for the future President in 1996 when Obama ran for the Illinois Senate.
Take action against hoarders and black marketers, says PM
NEW DELHI, Aug 8 (PTI) Prime Minister Manmohan Singh today said the Centre and States should not hesitate to take strong measures including against hoarders and black marketers to check the spiraling prices of essential commodities in the wake of delayed and deficient monsoon.
“In short, the contingency plan for crops, drinking water, human and animal health, fodder, etc should be brought into operation without delay and a close watch kept on availability of food grains and prices of essential commodities,” he said addressing a conference of state Chief Secretaries.
Agriculture Minister Sharad Pawar, Cabinet Secretary K M Chandrasekhar and Union Agriculture Secretary T Nanda Kumar were among those who attended the meeting.
Assuring Centre’s full support to states regarding any additional assistance that may be required, Singh said “there is need for us to act promptly, collectively and effectively.
In no case should we allow citizens to go hungry.”
The meeting was called against the backdrop of poor monsoon and the spectre of drought looming large over several parts of the country. The Prime Minister himself said that 141 districts in the country have been declared drought affected but no state has so far sent memorandum seeking assistance.
The Prime Minister referred to the possibility of reduced production of kharif crops having an inflationary impact on prices of food items in the coming months.
Reliance Industries speaks on gas dispute
MUMBAI, Aug 8 (IANS): Breaking its silence on the ongoing dispute with the Anil Ambani group over gas from Krishna-Godavari basin, Mukesh Ambani-led Reliance Industries (RIL) Friday said it will comment on the matter only in the court.
Soon after, the Anil Ambani group reacted saying the statement was vague and general, without providing a single response to the issues it has raised in areas ranging from contractual obligations to capital expenditure on the Krishna-Godavari gas.
The group also said that RIL was deliberately “shortchanging” state-owned power utility NTPC to the tune of up to Rs.30,000 crore “by reneging on a binding gas supply contract at $2.34 per unit”.
“Typical of RIL’s conduct even after weeks of silence, it has evaded substantial issues of national and public interest that have recently come under a watchful nation’s spotlight,” said J.P. Chalasani, chief executive of Reliance Power, an Anil Ambani group company.
“With no possible defence on merits, RIL has resorted to vague generalities and not provided a single specific response to grave charges. This is in line with RIL’s unfortunate practice of never coming on record and instead only falling back on selective leaks and un-attributable comments to media.”
Earlier, Atul Chandra, president of the petroleum business with Reliance Industries, while reading out a written statement before reporters here had said: “Our legal advisors have counseled us to refrain from commenting on the issue.
“We emphatically refute and out rightly reject the baseless and motivated allegations and insinuations made by Anil Ambani and his associates against Reliance Industries and its chairman Mukesh Ambani.”
to the RIL statement, Chalasani said, “RIL is taking refuge under a false cover of ongoing legal proceedings to skirt questions of national importance.”
Chalasani also said RIL had not responded to specific issues, some of them being:
Incurring disproportionate capital expenditure on Krishna Godavari D6 block, which could potentially cause losses of up to Rs.30,000 crore to the government of India
Hiding facts on disproportionate capital expenditure through tainted reports of alleged independent experts who actually had serious and undisclosed conflict of interest with RIL
Hoarding of gas by artificially curbing production to justify exorbitant pricing when global gas prices collapsed by over 75 percent
Raising the bogey of revenue losses to the government to shamefully appropriate for itself the legal and unethical super profits of over Rs.50,000 crore
Responding to RIL chairman Mukesh Ambani’s purported remarks, Chalasani quoted Reliance Power chairman Anil Ambani as saying: “I am pained that under my respected elder brother’s leadership RIL is still doing everything in its power to renege on its binding commitment to supply gas to us.
“This is contrary to the fundamental values of trust and integrity that my visionary father Dhirubhai Ambani stood for and on the basis of which he founded Reliance.
“Whatever is the reason, and I have no idea what it is, corporate greed, personal vendetta, misguided advice from the three Cs that is chelas, cha-chas and cronies, it is unfortunate and deeply distressing to me at a very personal and emotional level.”
Maintaining that there was personal gains for Anil Ambani, Chalasani added: “The only private and personal gains are unfortunately to RIL and its promoters.”
He also said the publicly-owned gas transportation company had been surreptitiously and deceitfully appropriated and transferred to private hands at the cost of RIL’s about 20 lakh shareholders.
Satyam, Maytas will be prosecuted if found they diverted funds
NEW DELHI, Aug 8 (PTI): The government is investigating whether Satyam and Maytas siphoned off funds from their respective companies and whosoever is found guilty would be prosecuted according to the law.
Revealing this, Corporate Affairs Minister Salman Khurshid said on Saturday, “any aspect, any dimension relating to their (Maytas and Satyam) relationship is under investigation reports would be made available whether money has been siphoned off and then the law will take its own course.”
Reports have been doing the rounds that Maytas Properties and Maytas Infra, the firms promoted by the founder of Satyam, B Ramalinga Raju, had diverted money. Speaking to reporters on the sidelines of a Assocham event, the minister said prosecution in the multi-crore Satyam fraud case would be carried on an urgent basis.
“The core issues are accountability of people in Satyam and we now want to give undivided attention to prosecution…you can treat it as highest urgency,” he added. The CBI has already filed a charge sheet in the Satyam scam which came into light early this year when Raju confessed to manipulating books of accounts of the company for several years. However, the Serious Fraud Investigation Office, which investigated the case, is yet to file a charge sheet.