HUL Falls Nearly 3%, Extends Losses to Second Day

Shares of HUL fell as much as 2.8 per cent at its day's low of Rs 895, extending its losses to the second day. The shares of the FMCG company declined nearly 0.70 per cent on Thursday.

Shares of HUL had outperformed the market in the past one month, gaining over 12 per cent amid better-than-expected June rainfall. In comparison, the Nifty rose nearly 4 per cent.

HUL shares also benefited from defensive-buying, amid turmoil in global markets.

However, the weather department on Thursday said that there has been a drop in rainfall in July and almost all regions except the North-West have started registering negative precipitation.

According to the India Meteorological Department, from June 1 to July 8, the country registered an overall deficit rainfall of 4 per cent.

In a report brokerage Nomura said that specific parts of the HUL's portfolio, which are more rural facing, may continue to remain under pressure, where any revival in growth may still be some time away.

The rural growth is likely to remain slow as the effects of poor crops destroyed by the unseasonal rainfall are being felt, Nomura added.

Nomura has a reduce rating on HUL, with a target price of Rs 785.

On the overall FMCG sector, Nomura said volume growth performance has remained uneven due to weak urban demand and a slowing rural economy. However, it expects volume growth to show signs of a recovery in Q1 largely on the back of a revival in urban consumption.

Government to implement FATCA to take over on Black Money

FATCA will be subjected to cover all fresh accounts opened by Indian Financial Institutions starting from July 1, 2014.

India is taking cues from US on how to tackle the offshore tax evasion problem, with the signing of the accord known as FATCA. The law was inked by Revenue Secretary Shaktikanta Das and US Ambassdor Richard Verma.

FATCA will be subjected to cover all fresh accounts opened by Indian Financial Institutions starting from July 1, 2014. Also they are required to share all the necessary data with the government in regards to all the account that has been filed from July 1 till December  31, 2014, allowing the government to share this data with US by September 30, 2015.

In case if a financial institution fails to follow the regulation of FATCA, it will be charged with 30 percent penalty tax on all its US  revenues, including dividend , interest, fees and sales.

"The signing of IGA is a reaffirmation of the shared commitment of India and USA towards tax transparency and the fight against offshore tax evasion and avoidance. The agreement underscores growing international cooperation to end tax evasion everywhere," a finance ministry statement said.

According to FATCA, participating foreign banks and financial institutions are needed to provide all the necessary information of offshore accounts and assets of  U.S. citizens and foreign firms under which U.S. taxpayers hold significant ownership.

Digital Opportunities! What did TCS bag in the digital space?

TCS has built and deployed a new Learning Platform to enable Digital training for 100,000 employees in this financial year. Immersive content has been created covering the entire gamut of Digital offerings.

TCS has built and deployed a new Learning Platform to enable Digital training for 100,000 employees in this financial year. Immersive content has been created covering the entire gamut of Digital offerings. The new Digital Learning platform and allied infrastructure will enable ‘anytime-anywhere’ learning in a cloud environment.

Following are the key digital wins of TCS:

• Selected by a North American bank for the deployment of mobile-based event management systems using the TCS Event Maestro product
• Selected by a leading UK retailer to enable gap scan and stock adjustment using mobile technologies
• Selected by a leading European life sciences company to enable clinical test workflow documentation on mobile devices
• Chosen by a leading UK bank to provide consulting and technology services for their Big Data initiative.
• Selected by a leading European telecom company to develop a system to compute key performance indicators using Big Data technologies with the objective of driving customer satisfaction.
• Engaged by a North American manufacturing company to provide consulting services to define the Big Data roadmap and architecture for its telematics solution
• Chosen by a global life sciences major as the preferred partner to drive its Social Media Analytics initiative
• Chosen by a North American insurer to provide on-premise enterprise applications on the Cloud
• Chosen by a North American multinational chemicals company to define the Digital Marketing strategy for its agro sciences businesses in Asia Pacific countries
• Selected by a European airline to reimagine the customer experience for its loyalty program
• Selected by a North American hi-tech major to develop the system to process click stream data for real time campaign delivery

Top corporate news of the day- July 10, 2015

Wipro said it will acquire global strategic design firm Designit for EUR 85mn, a move aimed at strengthening the digital services business of the country’s third largest software services company.

Wipro said it will acquire global strategic design firm Designit for EUR 85mn, a move aimed at strengthening the digital services business of the country’s third largest software services company. 

IL&FS Engineering and Construction Company has commissioned a project of gas transmission pipeline in Gujarat. The project includes laying 103 kms high pressure gas transmission pipeline on an EPC basis for Gujarat State Petronet Limited (GSPL). 

The Reserve Bank has authorised Yes Bank Ltd to undertake Primary Dealership business departmentally with effect from July 13, 2015. Yes Bank had earlier requested Reserve Bank of India to grant it Primary Dealership authorisation. 

Bharti Airtel will roll out 4G services in North East, excluding Assam, within next 2-3 months, the company said. 

The shareholders of Andhra Bank had approved a proposal for QIP or FPO at its Annual General Meeting. 

Russia’s top oil producer Rosneft plans to buy 49% stake in Essar Oil for about $3.2 bn. 

Telecom major Vodafone entered into a strategic partnership with retailer Walmart India to enable its business members make payments using the telco's mobile wallet service M-Pesa. 

Wagon manufacturer Titagarh Wagons said it will raise up to Rs 2. 5bn by selling securities to institutional investors. 

Bhushan Steel has received lenders' approval for long-term restructuring of about Rs 300bn loans under a scheme of Reserve Bank of India (RBI). The Joint Lenders Forum (JLF) has agreed to extend the loans of Bhushan Steel for tenure of 25 years under the RBI's scheme for long-term structuring of loans in line with cash flows. 

Top economy news of the day - July 10, 2015

The Reserve Bank is expected to grant payment bank licence to the postal department by September for operating Post Bank, Communications and IT Minister Ravi Shankar Prasad said.

The Reserve Bank is expected to grant payment bank licence to the postal department by September for operating Post Bank, Communications and IT Minister Ravi Shankar Prasad said.

In a major clean-up exercise, the BSE has proposed delisting more than 1,000 companies from its platform as trading in their shares have remained suspended for more than seven years for various penal reasons. 

Ministry of Road, Transport and Highways is mulling to set up Highway Equipment Development Council to develop new technologies and equipment in construction sector so as to bring down the cost of construction and improving the quality of road infrastructure in the country

Aurobindo Pharma gains on USFDA nod

The stock has jumped 2 percent at the opening bell on the BSE. The company has received USFDA approval for antiarrhythmic drug Flecainide Acetate.

Aurobindo Pharma opened 2 percent higher at Rs 1,480 on media reports that the company has received USFDA approval for antiarrhythmic drug Flecainide Acetate.

The stock is now up 1.3 percent at Rs. 1,469, with the counter has seen trades of around 10,000 shares as against two-week daily average volume of 102,000 shares.

Meanwhile, the Sensex has jumped 119 points at 27,692.

Mechanism for Public Offer of Government Bonds to be Out Soon: BSE

To encourage retail participation in government bonds, top stock exchange BSE today said that a mechanism would be in place in the next 6-9 months for a 'public offer' of such debt instrument.
  "The government can raise funds by initial public offer (IPO) of the government bonds through the e-IPO system. This would reduce the government's servicing cost and is an additional avenue for the government to raise funds and provides an avenue for the retail investors to participate in government bonds," BSE Managing Director & CEO Ashishkumar Chauhan told reporters here.

Chauhan was speaking on the sidelines of celebration of the exchange's 140th anniversary.

Noting that government bonds are basically risk-free instruments, Chauhan said the government and Reserve Bank of India (RBI) is in talks with the stock exchanges about public offer of government bonds.

"In 6-9 months we believe there would be a good mechanism to offer and trade government bonds in an easier way through depositories," he noted and added that the exchange is keen on bringing in more risk-free instruments to make attract larger number of investors into the capital markets.

Talking about BSE's plans to set up a commodity bourse, Chauhan said the stock exchange is awaiting the new policy that would be issued on completion of Sebi-FMC merger.

On setting up operations in Gujarat International Finance Tec-City (GIFT) in Gandhinagar, he said the BSE is waiting for clarity on taxation norms as well as information on which provisions of the companies act would be applicable in GIFT.

The guidelines related to GIFT are expected to be out before September, he added.

The BSE, which is Asia's oldest stock exchange, was one of the first to announce establishing the country's first International Exchange at the international financial services centre (IFSC).

Chauhan also said that as derivatives carry a high risk rate, the government and the regulator should look at excluding retail investors from trading in them.

"It is clear that we need to relook at what type of investor participation we need in the instrument," he added.

Gold Clings Above Four-Month Low on Euro

Manila: Gold held above a four-month low early on Friday, spurred by a firmer euro on signs of progress in debt-hit Greece's efforts to secure fresh funding.

But bullion is still down so far for the week, its third in a row, as the Greek debt saga and China's equities rout failed to spark safe-haven bids.

Fundamentals

* Spot gold was up 0.1 percent at $1,160.68 an ounce by 0029 GMT. It had lost 0.6 percent for the week after touching $1,146.75 on Wednesday, its lowest since March 18.

* U.S. gold for August delivery was nearly flat at $1,159.50 an ounce.

* The Greek government sent a package of reform proposals to its euro zone creditors on Thursday in a race to win new funds to avert bankruptcy and will seek a parliamentary vote on Friday to endorse immediate actions.

* The euro gained against the dollar on the news, making dollar-denominated assets such as gold cheaper for buyers using other currencies.

* Investors will also keep an eye on China's stock market which bounced around 6 percent on Thursday after Beijing banned shareholders with large stakes in listed firms from selling.

* The International Monetary Fund trimmed its forecast for global economic growth this year, citing recent weakness in the United States. But the IMF said growth prospects for next year remain undimmed, despite Greece's debt crisis and recent volatility in Chinese financial markets.

* New applications for U.S. unemployment insurance benefits rose last week to their highest level since February, suggesting some slowdown in the labour market recovery

Asian Shares Edge Up, Euro Gains After New Greek Proposals

Asian shares and the euro gained in early Asian trade on Friday after Greece offered new reform proposals to creditors, raising hopes of a cash-for-reform deal at a weekend summit of European leaders.

MSCI's broadest index of Asia-Pacific shares outside Japan was up 0.3 per cent, but still on track for a weekly loss over 4 per cent in a period marred by a savage correction in Chinese stock markets.

U.S. stock futures also rose, with S&P 500 mini futures jumping as high as 2061.75, up 1.0 per cent from late U.S. levels. They were last up 0.7 per cent.

But Japan's Nikkei stock index dropped 0.3 per cent, headed for a weekly loss of over 3 per cent.

The euro extended gains, adding 0.4 per cent to $1.1072, while the dollar gained 0.3 per cent against the safe-haven yen to 121.71 yen.

The euro surged 0.7 per cent to 134.81 yen, recovering from a six-week low of 133.30 yen plumbed on Wednesday.

New measures Greece offered included a tax hike on shipping companies and scrapping tax breaks for its islands, higher value added tax for restaurants and a firm timetable for privatisations.

The Greek government will ask for parliament's approval on Friday to negotiate on the text of "prior actions" that could form the basis of a cash-for-reforms deal with creditors, a government source said.

Germany, Athens biggest creditor, also made a small concession on Thursday by acknowledging that Greece will need some debt restructuring as part of the new programme to make its public finances viable in the medium-term.

Hopes on a deal for Greece is likely to support Asian shares, though volatility in Chinese shares will likely need to ease off further before many investors step up buying.

"U.S. futures are higher, but we are waiting to see if stocks in Shanghai continue to recover, and if the VIX comes off its highs, before we can say that risk sentiment has improved, even as the Greek news has raised hopes," said Junichi Ishikawa, market analyst at IG Securities in Tokyo.

Beijing's increasingly frantic attempts to stem a stock market rout were finally rewarded on Thursday as Chinese shares bounced around 6 per cent.

But investors are not sure if the worst is over in the short term, and the costs of heavy-handed state intervention in the stock market are likely to weigh on the market for a long time.

In commodities trading, crude oil futures were steady but remained on track for steep weekly losses. U.S. crude was trading up 0.2 per cent at $52.89 per barrel, more than 7 per cent below last Friday's close. Brent crude was slightly higher on the day at $58.63 a barrel, but still more than 2 per cent down for the week.

TCS Q1: Brokerages Give Thumbs-Up Despite Mixed Earnings

Tata Consultancy Services missed revenue growth estimates in the June quarter, but India's biggest outsourcer beat profitability estimates.

Here's what leading brokerages have to say about TCS Q1:

CLSA reiterated "buy" on TCS, says TCS has started with a slower sprint this year. Q1 revenue was a miss, but the company reported strong margins, it added.

Credit Suisse says TCS continues to be a core holding. Near-term stock performance could be constrained and premium to Infosys can contract after recent expansion, it added.

Kotak says TCS is well-placed for a bounce-back. Revenues a tad off the track, but core growth intact, it said. Multiple quarters of revenue miss is a concern, Kotak added.

Morgan Stanley said valuations are full leaving limited upside for TCS.

Deutsche Bank says TCS has made a steady start to FY16 with impressive margin beat. For Deutsche Bank, TCS is top "buy" in IT space with target price of Rs 2,900.