Cabinet approves Gold Monetisation & Gold Bond Schemes

Annual cap on gold bond scheme will be 500 grams per individual, Arun Jaitley said. The Finance Minister is of the view that the Gold Monetisation Scheme will channelise idle gold assets.

Cabinet on Wednesday approved the Gold Monetisation & Gold Bond Schemes, which would replace both the present Gold Deposit and Gold Metal Loan Schemes

Annual cap on gold bond scheme will be 500 grams per individual, Arun Jaitley said. The Finance Minister is of the view that the Gold Monetisation Scheme will channelise idle gold assets.

Talking about the interest rates, the FM added that interest on gold bonds will be decided by government from time to time. 

It is widely estimated that the country houses around 24,000 tons of gold stocks, however, the actual number can be much higher than the estimates.

ABN Amro, DBS, State Bank of Mauritius apply for WOS

Under the new RBI rules, foreign banks with 20 or more branches have to mandatorily convert into local subsidiaries.

Three foreign bankers - ABN Amro, DBS and State Bank of Mauritius - have applied for operating as wholly-owned subsidiaries (WOS) in the country, according to Reserve Bank of India (RBI) deputy governor R Gandhi.

"ABN Amro, DBS and State Bank of Mauritius have applied to convert their franchises in the country into local subsidiaries," Gandhi told reporters in Mumbai.

At present, there are nearly 100 foreign banks operating in the country and all of them operate through branches or as representative offices.

Under the new RBI rules, foreign banks with 20 or more branches have to mandatorily convert into local subsidiaries.
Also, the foreign banks entering India after August 2010 would have to mandatorily follow the local subsidiary route.

Currently, only Standard Chartered, HSBC and Citigroup have over 50 branches each and fall under the mandatory WOS route.  

IVRCL close to raising Rs. 10bn via asset sales: Report

The funds raised from the sales will be used to reduce IVRCL’s debt, according to a financial daily.

IVRCL is reportedly close to raising ~Rs. 1,000 crore by selling some of its assets.

IVRCL is reportedly looking to sell three of its road projects in Tamil Nadu to Tata Realty & Infrastructure Ltd. (TRIL) and a desalination plant to Dubai-based water and utilities supplier, Utico FZC, by December.

The funds raised from the sales will be used to reduce IVRCL’s debt, according to a financial daily.

In July 2014, a consortium of 20 banks led by State Bank of India (SBI) approved a debt restructuring package worth INR 7,350 crore for IVRCL through the corporate debt restructuring cell.

Under the package, IVRCL also received fund and non-fund based credit worth over INR 2,000 crore.

Top economy news of the day- September 9, 2015

Fairness creams are again under scrutiny with the Maharashtra FDA issuing notices to Chandigarh-based pharmaceutical company Torque Pharma over the latter's attempts to position its steroid-based fairness creams as over-the-counter products. Steroid-based drugs or creams have to be prescribed by a doctor, which means these cannot be advertised at all.

Fairness creams are again under scrutiny with the Maharashtra Food & Drug Administration (FDA) issuing notices to Chandigarh-based pharmaceutical company Torque Pharma over the latter's attempts to position its steroid-based fairness creams as over-the-counter products. Steroid-based drugs or creams have to be prescribed by a doctor, which means these cannot be advertised at all.

Natural rubber market got into doldrums as the Kerala government's market intervention program miserably failed. Though the state government requested Rs10bn under the price stabilisation scheme, Union government has so far not sanctioned funds for bailing out the million plus rubber growers. RSS-4 grade rubber quoted Rs111/Kg, lowest during last 12 months.

Cotton output in India is likely to drop by up to 15% this year due to insufficient rain and pest attack in two cotton-growing regions of the country. In Gujarat, a major cotton-producing state, the crop has been hit by weak rainfall after a good sowing period, when the monsoon was strong. Rainfall in the region has been patchy and 28% below normal.

Top Corporate news of the day - September 9, 2015

Indiabulls Housing Finance is planning to raise up to USD 600mn by way of offering equity to institutional investors by way of Qualified Institutional placement.

Indiabulls Housing Finance is planning to raise up to USD600mn by way of offering equity to institutional investors by way of Qualified Institutional placement (QIP). (BS)

After a somewhat shaky start to it campaign down south last year, Sunil Lulla led film studio and content distribution company Eros International has finally found its footing in the South Indian film industry. The company has slotted 12 south Indian films for release in its slate this fiscal, outstripping even the number of Bollywood releases for the year.

Indian Overseas Bank (IOB) has launched Rupay MUDRA Debit Card under the Pradhan Mantri MUDRA Yojna, targeting the micro, small and medium enterprises (MSMEs). 

IVRCL Limited will seek shareholders nod for an enabling resolution to raise up to Rs5bn through a qualified institutional placement offer.

Hindustan Unilever Ltd (HUL) has signed an agreement for the sale and transfer of its bread and bakery business under the `Modern’ brand to Nimman Foods Pvt Ltd, an investee company of the Everstone Group (Everstone).

Tata Power started work to set up its Rs4.5bn defence manufacturing facility in Karnataka.

Engineering firm Kalpataru Power Transmission (KPTL) will seek shareholders’ nod to issue securities for up to Rs3bn on a private placement basis.

GlaxoSmithKline Pharmaceuticals began work for setting up a Rs10bn pharmaceutical manufacturing unit in Karnataka.

Bank of Maharashtra said the bank will issue over 100mn shares to the government in exchange of capital infusion of Rs3.94bn.

LIC Housing Finance ( LHFL) will raise up to Rs430bn via non-convertible debentures on private placement basis.

AGMs of the day

Check out the companies AGM which are expected today are Amforge Industries, Lambodhara Textile, Anjani Portland Cement, Larsen & Toubro, Aruna Hotels, Mphasis, Ashoka Buildcon.

Check out the companies AGM which are expected today are  Amforge Industries, Lambodhara Textile,  Anjani Portland Cement, Larsen & Toubro, Aruna Hotels, Mphasis, Ashoka Buildcon, Neelamalai Agro Industries, Asian Star Company, Odyssey Technologies, Bharat Petroleum Corp,  The Phoenix Mills, Biopac India Corp, Reliance Industrial Infrastructure, Emami Infrastructure,  Shivam Autotech, Garden Silk Mills,   Solar Industries India, Hb Leasing & Finance Co,TT Ltd, Hb Stockholdings,Tribhovandas Bhimji Zaveri, Jayabharat Credit, Zandu Realty 

Rupee opens higher by 17 paise at 66.38/dollar

The currency movement will be tracked and the rupee could see some firmness on account of FII inflows. The currency touched a high and low of 66.53 and 66.75 respectively.

Indian Rupee today opened at 66.38 against the dollar,higher by 17 paise in early trade on Wednesday after rally in global equity markets. On the global front, Moody's Investors Service has warned Asian currencies could depreciate further in anticipation of monetary tightening by the US Federal Reserve, which further could aggravate capital outflows from the region's emerging markets. It has cut growth forecast for a number of Asia Pacific economies citing subdued global growth, exacerbated by weaker demand from China.

The currency movement will be tracked and the rupee could see some firmness on account of FII inflows. The currency touched a high and low of 66.53 and 66.75 respectively. The Reserve Bank of India’s (RBI) reference rate for the dollar stood at 66.60 and for Euro stood at 74.60 on September 08, 2015. While, the RBI’s reference rate for the Yen stood at 55.60, the reference rate for the Great Britain Pound (GBP) stood at 102.3002.

Wall Street Jumps 2% as China Gains Fuel Global Stock Rally

US stocks rose more than 2 per cent on Tuesday, bouncing after steep losses last week and a China-fuelled rebound in global equities.

Gains were broad-based and followed a three-day U.S. holiday weekend. All but one of the 10 major S&P sectors - energy - ended with gains of more than 2 per cent.

Hopes for more stimulus measures from the Chinese government increased after data on Tuesday showed that China's imports shrank far more than expected in August, falling for the 10th straight month.

Chinese stocks surged in a late rally, sparking a rebound in global equities. Late on Monday, China said it would remove a tax on dividend incomes for investors who hold stocks for more than a year in an effort to encourage longer-term investment.

"We had some nice buying opportunities with the sell-off in August, and I think people are starting to take advantage of that and put money to work," said Larry Peruzzi, senior equity trader at Cabrera Capital Markets Inc in Boston.

"In China it seems like there is a willingness to continue with stimulus, so hopefully those markets will stabilise."

The Dow Jones industrial average rose 390.3 points, or 2.42 per cent, to 16,492.68, the S&P 500 gained 48.19 points, or 2.51 per cent, to 1,969.41 and the Nasdaq Composite added 128.01 points, or 2.73 per cent, to 4,811.93.

All three major U.S. stock indexes posted losses of at least 3 per cent for last week.

Global financial markets have been rattled in recent weeks by fears that China's slowdown could drag on already sluggish global growth, prompting some investors to bet that the U.S. central bank will delay a hike until the end of the year.

A mixed report on the U.S. jobs market for August on Friday added to investor uncertainty over whether the Federal Reserve will increase interest rates at its Sept. 16-17 meeting.

Apple <AAPL.O> shares gave the biggest boost to the S&P and the Nasdaq, rising 2.8 per cent to $112.31, a day before the iPhone maker is expected to unveil new offerings.

Media General fell 6 per cent to $10.48 after it said it would buy diversified media company Meredith Corp for about $2.34 billion to create the third-largest local TV station owner in the United States. Meredith was up 9.9 per cent at $50.47.

After the bell, Yahoo shares were down 3.1 per cent at $29.95 after it said it was considering its options following an Internal Revenue Service denial of its request on a tax ruling related to Yahoo's plans to exit a stake in Alibaba Group Holding Ltd.

In addition, shares of United Continental Holdings were down 2.8 per cent at $55.90 after the bell following the company's announcement that Chief Executive Jeff Smisek had stepped down.

Advancing issues outnumbered declining ones on the NYSE by 2,439 to 644, for a 3.79-to-1 ratio on the upside; on the Nasdaq, 2,202 issues rose and 646 fell for a 3.41-to-1 ratio favouring advancers.

The benchmark S&P 500 index posted one new 52-week high and no new lows; the Nasdaq Composite recorded 46 new highs and 30 new lows.

About 6.8 billion shares changed hands on U.S. exchanges, compared with the 7.5 billion daily average for the month to date, according to data from BATS Global Markets.

Asian Stock Markets Surge, Japan's Nikkei Rallies Nearly 6%

Tokyo/Singapore: Asian shares caught a tailwind on Wednesday after upbeat German economic data powered gains in US and European markets, while the safe-haven yen skidded as investors' mood turned positive.

MSCI's broadest index of Asia-Pacific shares outside Japan was up 2.5 per cent by 0250 GMT, with gains across all the major indices that were open.

Japan's Nikkei soared 5.7 per cent, on track for its biggest one-day rise since March 2011. In the previous session, it lost 2.4 per cent and wiped out its year-to-date gain.

Major Wall Street indices all logged gains of more than 2 per cent overnight.

European stocks also had a banner day on news Germany's imports and exports hit record highs in value terms in July.

Chinese shares rose late on Tuesday after digesting a bigger-than-expected drop in imports. The trade data raised fears that China's slowdown could be sharper than many had expected, which in turn raised hopes that Beijing would muster more easing steps to prevent a hard landing.

The Shanghai Composite index climbed 1.7 per cent on Wednesday. Hong Kong's Hang Seng index added 2.7 per cent.

"With many markets having been sold off heavily over recent weeks, today's rally, like the U.S. last night, represents a speculative bounce," said Angus Gluskie, managing director of White Funds Management in Sydney.

"The market will remain susceptible to a return of negativity until we see signs of some improvement in the original causes of weakness, which were predominantly Chinese growth concerns," he said.

The dollar put in a mixed performance, slipping slightly against a basket of six rival currencies to 95.945, and against the euro to $1.1191.

But the greenback firmed about 0.5 per cent against the yen to 120.25 as the improved market mood sapped some of the appeal of the perceived safe-haven Japanese currency.

The euro also gained on the yen, rising 0.3 per cent to 134.56.

Crude oil futures remained steady but at low levels on lingering concerns about a global supply glut.

U.S. crude rose 0.2 per cent to $46.15 ahead of weekly crude inventories data due from industry group American Petroleum Institute later in the session.

Brent crude rose 0.4 per cent to $49.74, after jumping 4 per cent the previous session following upbeat German economic data.

Nifty Seen Rebounding to 7,800; Tata Steel, Axis Bank May Gain

The Nifty staged a strong rebound on Monday, rising 1.71 per cent or 129.45 points higher at 7,688. According to derivative data, the blue chip index will extend gains today.

Open interest in Nifty September futures increased by 3.7 lakh, while the premium expanded to 31.15 points from 15.7 points earlier, suggesting addition of fresh long position.

The pull back in Nifty may last till 7,800 levels as 6.1 lakh shares have been added to the 7,800 strike Nifty call. Meanwhile, the 7,500 strike Nifty put continues to have maximum open interest concentration of 46.6 lakh shares. So, 7,500 is expected to act as a strong support for the Nifty.

The India VIX, or the fear gauge fell 6.76 per cent to close at 24.56 suggesting lower anticipated volatility in the near future.

Among individual stocks, Tata Steel and Axis Bank have witnessed addition of long position; open interest in these stocks increased along with increase in price. Meanwhile, Hindustan Unilever has witnessed significant addition of short positions; open interest in the stock increased by 7 per cent along with 2.3 per cent fall in its price.

Sensex Poised to Open Higher Amid Global Rally

BSE Sensex and Nifty are likely to sharply higher, boosted by a rally in global markets. The SGX CNX Nifty was up 1.4 per cent to 7,844, indicating a higher opening for Indian markets.

Here is a 10-Point Cheat-Sheet:

1) Asian markets, including China, were trading sharply higher with Japan's Nikkei surging nearly 6 per cent. China's benchmark indices were up nearly 2 per cent.

2) US stocks rose more than 2 per cent overnight amid a China-fuelled rebound in global equities. Hopes for more stimulus measures from the Chinese government increased after data on Tuesday showed that China's imports shrank far more than expected in August, falling for the 10th straight month.

3) China also said it would remove a tax on dividend incomes for investors who hold stocks for more than a year in an effort to encourage longer-term investment. This triggered rebound in China markets yesterday.

4) Data showing Germany saw imports and exports hit record highs in value terms in July also helped the global rally in equities.

5) Analysts also said that global markets were in an oversold territory which helped to spur a relief rally.

6) Analysts however are skeptical of the sustainability of gains in Indian markets in the face of relentless selling from foreign investors.

7) Indian markets are also witnessing an exodus from foreign investors who sold a record Rs 16,877 crore worth of domestic stocks in August. On top of that, they sold Indian stocks worth nearly Rs 5,500 crore in the past six sessions.

8) Domestic institutional investors have been buyers of stocks despite the selloff from foreign investors, helping to provide some support to Indian markets. On Tuesday, they bought shares worth nearly Rs 450 crore. Despite Sensex and Nifty losing over 6 per cent in August, investments into Indian mutual funds surged in August from July, signalling the continued retail support for equities despite a deteriorating outlook. Investments into equity mutual funds rose 63 per cent to Rs 9,625 crore last month from July, marking a 16th consecutive month of inflows.

9) Indian markets are likely to remain volatile till the crucial US Fed meet, which is scheduled for September 16-17, say analysts. An interest rate hike in the US could accelerate the selling from foreign investors who would like to park their money in US bonds. Besides, a rate hike in the US would strengthen the dollar, putting further pressure on rupee.

10) Traders are also watching the value of the rupee which affects the dollar returns of foreign investors. The rupee traded higher at 66.33/dollar against yesterday's close of 66.54.