Turnover today:

The NSE Cash turnover was at Rs 10014.83 crore
The NSE F&O turnover was at Rs 40494.64 crore
The BSE Cash turnover was at Rs 5029.26 crore
The total turnover was at Rs 55538.73 crore

Markets this week

• Market recover from week’s low on across sector buying
• Sensex down 1.2% or nearly 170 points at 14355; recovers 550 points from week's low
• Nifty down 1% or nearly 35 points at 4146.20; recovers 180 points from week's low
• BSE Bank Index down 5% on unexpected CRR hike
• SBI down 6.5%, HDFC Bank down 5.5%, ICICI Bank down 4.5%
• BSE Cap Goods Index down 3%, Suzlon down 16%, BHEL down 4.5%
• Index Losers: Hindalco, VSNL down 12.5% each, Jet Airways down 7.3%
• Index Gainers: Wipro up 6%,Bharti up 5.5%, Satyam up 3.5%, ONGC up 2.5%
• CNX Midcap Index down 1% at 5245; realty stocks feel heat due to CRR hike
• Midcap Gainers: TV Today up 28%, Bajaj Hind up 12%, Praj Ind up 10%
• Midcap Losers: Akruti Nirman down 18.5%, Unitech down 16%
• BSE Small Cap Index down 2.5% at 7290

India on the move: Roach

Stephen S Roach, chief economist at the US-based Morgan Stanley, returning from his fourth trip to India in three years, said the South Asian country has achieved breakthroughs in savings and foreign direct investments that would script one of the world’s most exceptional economic development stories over the next three-five years.

“I am returning from India with great enthusiasm. India has made solid progress on two counts — savings and FDI — and infrastructure development seems set to follow. These are breakthroughs that can unshackle India’s greatest strengths — a high-quality stock of human capital and the magic of its entrepreneurial spirit.

India’s national saving at 32.4 per cent in the 12 months ending March 2006 is up significantly from the 25 per cent average of the 1990 to 2004 period.

At the same time, the aggregate investment ratio has moved up to 33.4 per cent as of March 2006, a major breakout from the 26 per cent average of the preceding 15 years. And foreign direct investment is on target to hit $13 billion in the 12 months ending March 2007, more than double India’s previous best of $5.5 billion hit in the previous year.

read more......

How to tackle inflation

Ajay Shah / New Delhi February 07, 2007


One of the great strengths of India is that the political system just does not accept high inflation.

Is the government getting needlessly hysterical about inflation? Many people think it is okay to tolerate some inflation if, in return, it is possible to sustain higher growth rates. Nothing matters as much for peace, prosperity and poverty alleviation as high GDP growth, so I would always advocate any policy which delivers higher sustained GDP growth. However, the link between inflation and growth is complex. High inflation does not give high growth. The growth miracles of Asia, where above 7% growth was sustained over a 25-year period, were not associated with high inflation. In fact, countries with high inflation have tended to have low growth.

In the business cycle, an acceleration of inflation can support a temporary acceleration of growth. In India, expected inflation has gone up from roughly 3% in 2004 to roughly 7% today--a rise of 4 percentage points. Interest rates have risen by less than 4 percentage points. As a consequence, real interest rates have actually gone down. Borrowing has become cheaper; we have a credit boom; and this is giving heightened GDP growth.

read more.....

Govt to let Re rise to bring inflation down

NEW DELHI: The government is plumping for a stronger rupee as the most effective short-term measure to combat inflation, according to sources in the finance ministry. The ministry has already indicated to RBI governor YV Reddy that the government will be comfortable with a stronger rupee. The central bank has been allowing the rupee to appreciate of late. The Reserve Bank could also resort to a hike in the cash reserve ratio (CRR), as merely tinkering with interest rates at the short end does not reduce the excess liquidity that is feeding inflation, which is currently pushing 6%. The bulk of inflation reflects supply constraints: metal prices are high globally (nearly 30% increase over 12 months in dollar terms) as also food prices (up 13%, again in dollar terms). The government has taken several supply-side measures to reduce prices: slashed import duties on base metals, cement and wheat, curtailed export of sugar, and imported wheat at zero duty. It is trying to import pulses from Myanmar and Canada and planning to step up open market sales of wheat. However, the price rise has not been contained. Longer term supply-side measures will take time to kick in. Also, the current price rise is not just a supply-side impact. There’s another villain in this story: the huge amount of foreign capital flowing into the country, seeking to cash in on the India boom. Just over the last one week, $3 billion has come into the country, said the finance ministry official. When foreign capital flows in, money supply goes up as RBI purchases the inflow, giving rupees in return. RBI seeks to take back this extra money in the system by selling government securities. When the public picks up bonds, the cash flows into RBI, reducing the money supply. But such sterilisation is not complete and external capital inflows lead to a rise in the money supply.

source: TIMES NEWS NETWORK

India sees a GDP growth of 9.2% in 2006-07

NEW DELHI: Driven by robust performance in manufacturing and financial services, the country's Gross Domestic Product (GDP) growth is projected at 9.2 per cent during 2006-07, against 9 per cent in the previous year.The 9.2 per cent GDP growth for 2006-07 is projected on top of 9 per cent for 2005-06, taking the growth to over 9 per cent for the second year running, according to advanced estimates released by the CSO here.However, the advance estimates showed that growth in agriculture dipped again to 2.7 per cent in 2006-07 after rising to 6 per cent in the previous year.The manufacturing sector grew at 11.3 per cent against 9.1 per cent while construction took a breather to 9.4 per cent against 14.2 per cent last year.The financing, insurance, real estate and business services continued to perform well logging in 11.1 per cent growth against 10.9 per cent.There was a marginal improvement in mining and quarry to 4.5 per cent from 3.6 per cent last year. The GDP at factor cost (1999-2000) prices is likely to reach Rs 28,44,022 crores in 2006-07 as against quick estimates of Rs 26,04,532 crores for 2005-06.The estimated growth in GDP for the trade, hotels, transport and communication sector during 2006-07 is placed at 13 per cent.The trend is derived from the April-November 2006 growth which is 10.1 per cent in Railway revenue earning freight traffic, 8 per cent in cargo handling in major ports, 34.1 per cent in production of commercial vehicles, 28.1 per cent in passengers handled in civil aviation, 10.5 per cent in air cargo handled and 52 per cent in telephone connections.The lacklustre performance in agriculture has forced the government to lower the estimates of wheat and rice production to 72.5 million tonnes against the initial estimates of 74 MT.

source: PTI[ WEDNESDAY, FEBRUARY 07, 2007 12:45:30 PM]

Markets Today...

• All time high closing for Sensex, Nifty
• Sensex up 1.14% or 165 points at 14643.13
• Nifty up 0.68% or 28.35 points at 4224.25
• BSE IT Index up 2.2%; Infosys up 3.7%, Wipro up 1.26%
• BSE Auto Index up 1.5%; Bajaj Auto up 9%, Hero Honda up 2.7%
• Index Gainers; Cipla up 3%, VSNL up 2.9%, Grasim up 2.8%
• Index Losers; BPCL down 2.6%, Tata Motors down 1.9%, ONGC down 1.8%
• CNX Midcap Index closes above 5400
• Midcap banking & tech stocks in focus; IndusInd bank up 14%, NIIT Tech up 9.34%, iGate up 8.5%
• BSE Small-Cap Index up 0.46% or 35 points
• Lakshmi Vilas Bank up 20%, Autoline up 10%
• New Listing: Akruti Nirman closes at Rs 563.45 Vs listing price at Rs 692
• New Listing: Cambridge Solutions closes at Rs 100.9 Vs listing price at Rs 48.7
• Total market turnover at Rs 43490.99 cr Vs Rs 45857 cr on Tuesday