Stocks
Market awaits further direction: Weekly Market Report

Medium term outlook shows a downward bias  

 
The Indian market settled marginally down in the holiday-shortened week on subdued global cues and with most of the companies coming out with not-so-impressive corporate results. The slowing economic growth—not only in India, but across the world—has raised fresh concerns, going ahead. Investors will continue to focus on earnings reports and will keep a watch on the Reserve Bank of India’s review of the monetary policy for the second quarter, due on 30th October.
 
The Sensex ended the week at 18,625, down 57 points (0.30%) and the Nifty finished 20 points (0.35%) down at 5664. The Market is in an indecisive zone. However, the bias is downward for the medium-term.
 
The market settled in the positive on Monday on a clutch of better-than-expected quarterly earnings from blue chips. However, selling pressure in heavyweights saw the benchmarks settling lower on Tuesday. Resuming after a day’s break, the market settled in the green on Thursday despite a high degree of volatility due to the F&O contracts expiry. The indices closed in the red on Friday on the back of disappointing earnings reports and global concerns.
 
The BSE Capital Goods index gained 2% while BSE Consumer Durables (down 4%) and BSE Fast Moving Consumer Goods (down 3%) were the main losers in the sectoral space.
 
The top gainers on the Sensex were Mahindra & Mahindra (up 7%), Larsen & Toubro (up 4%), ICICI Bank, TCS and NTPC (up 2% each). The losers were led by Jindal Steel & Power (down 5%), ITC, State Bank of India (down 4% each), Tata Motors and Hindustan Unilever (down 3% each).
 
The major gainers on the Nifty were M&M (up 7%), L&T (up 5%), IDFC (up 4%), BPCL and Axis Bank (up 2% each). Punjab National Bank (down 9%), Jindal Steel, Power Grid Corporation (down 5% each), Bank of Baroda, ITC (down 4% each) were the key losers on the benchmark in the week.
 
It is widely expected that the RBI, in its policy review next week, might keep all key rates unchanged on account of prevailing high inflation that stood at 7.81% in September. However, some analysts expect that the central bank may cut the cash reserve ratio (CRR), the proportion of deposits that banks have to keep with the RBI, by 25 basis points.
 
A reshuffle of the Union Cabinet is expected to take place on Sunday, 28th October. External affairs minister SM Krishna has tendered his resignation on Friday, which has been accepted by the prime minister. Information and broadcasting minister Ambika Soni, social justice and empowerment minister Mukul Wasnik, tourism minister Subodh Kant Sahai, MoS justice and empowerment Mahadev Khandela submitted their resignations on Saturday. The reshuffle of the Union Cabinet, which could be the last before 2014 Lok Sabha elections, is expected to see induction of new faces in the government.
 
In international news, the US economy reported a 2% annual growth in the third quarter of 2012 over 1.3% GDP growth in the previous quarter.  Also, consumer sentiment in the US rose to 82.6 in October, the highest level recorded in the last five years, according to the Thomson Reuters/University of Michigan's final reading on the overall index. However, US markets settled lower in the week on a clutch of weak earnings reports and nervousness ahead of the presidential elections in the world’s biggest economy.
 
In the Eurozone, policymakers on Thursday said that Greece would need an additional 30 billion euros ($39 billion) to make up for its deep recession and delay in overcoming deficit targets. 
 

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Ambika Soni, Mukul Wasnik, Subodh Kant Sahai resign ahead of Cabinet reshuffle

Prominent new faces in the Cabinet could be actor-turned politician Chiranjeevi from Andhra Pradesh and AH Khan Chowdhry, from West Bengal, while younger ministers like Sachin Pilot, Milind Deora and Jyotiraditya Scindia are likely to be upgraded

 
New Delhi: Ahead of Sunday's reshuffle of the union council of ministers, three Cabinet Ministers and a Minister of State resigned on Saturday, saying they want to work for the party, reports PTI.
 
Information and Broadcasting Minister Ambika Soni, Social Justice and Empowerment Minister Mukul Wasnik and Tourism Minister Subodh Kant Sahai and MoS Justice and Empowerment Mahadev Khandela met Prime Minister Manmohan Singh and submitted their resignations. External Affairs Minister SM Krishna quit the government yesterday.
 
The ceremony for swearing-in of new ministers is scheduled at 11.30 hours at the Rashtrapati Bhavan tomorrow when a number of new faces are likely to be inducted.
 
Prominent among them are actor-turned politician Chiranjeevi from Andhra Pradesh and AH Khan Chowdhry, MP from West Bengal, who is also the brother of the late Ghani Khan Chowdhry.
 
The possible names of the successors in the External Affairs Ministry include Commerce Minister Anand Sharma
 
Sahai's name had cropped up in a controversy following media expose that he had recommended for allocation of coal block a company in Jharkhand in which his brother was a Director. 
 
Offering their resignation, Soni, Wasnik and Sahai said they will work for the party. Soni was Congress General Secretary for several years and was Political Secretary to Congress President Sonia Gandhi while Wasnik was handling the dual responsibility of Congress General Secretary as well as Union Minister.
 
Before meeting the prime minister, Sahai said yesterday that Congress President Sonia Gandhi called him to draft for party work.
 
"It is an honour to work for the party. I am offering my resignation to Prime Minister. Party President (Sonia Gandhi) and others want me to work for the party so I will be working to strengthen the party as the party is supreme.We are in the government because of the party. Party is supreme and will always be supreme," he said.
 
Soni said, "I have taken Prime Minister's permission to resign. It is not appropriate if I do it on my own so I have taken his permission and explained it to him".
 
Asked if she was willing to work for the party, she said, "I think it is an honour".
 
Wasnik said, "I have been working for the organisation for the last several years and I would like to work for the organisation".
 
The reshuffle of the Union Cabinet, which could be the last before 2014 Lok Sabha elections, is expected to see induction of new faces in the government.
 
Chiranjeevi is being rewarded for his help in ensuring stability of the Congress government in Andhra Pradesh by lending the support of 18 of his MLAs after the merger of his party PRP.
 
The other changes could include ministers holding dual portfolios shedding one of their responsibilities..
 
Younger ministers like Sachin Pilot, Milind Deora and Jyotiraditya Scindia are likely to be upgraded.
 
There have been berths vacated by DMK representatives A Raja and Dayanidhi Maran in the last two years after their names cropped in the 2G scam.
 
However, DMK President M Karunanidhi had recently made clear that his party will not not like to reclaim their lost berths.
 
Whether Rahul Gandhi would join the government is still a matter of conjecture even as the Prime Minister held consultations with Congress President Sonia Gandhi the day before yesterday, apparently to give final touches to the exercise.
 
There is speculation that some young faces, considered close to Rahul, like Manicka Tagore and Meenakshi Natarajan could be inducted into the council of ministers.
 

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COMMENTS

MOHAN

5 years ago

"inefficient" veterans like Krishna thrown out of the cabinet. What about the most inefficient MMS? Who will chuck him out?

The Insider’s View: The Gilded life view of an IAS officer

The book contains bland memories of an IAS officer, Javed Chowdhury who comes from a privileged background (Doon School, St Stephen’s College) but believes in welfare socialism, the public sector, the subsidy system. He seems to have seen no evil, spoken no evil and heard no evil (except the ‘neo-liberal’ ideas of the 1990s)

 
India is a land of violence, injustice and extreme income disparity. Life for the common people is tough: courts don’t deliver justice; property rights get violated; the police are often party to crime; and money and power can fix the system, more often than not. Who could have tackled all these issues? Public servants, mainly members of the elite IAS—Indian Administrative Service—who run the country. From the police to securities regulations, from irrigation projects to banking regulations, from city corporations to transport systems—they are the omnipotent and omnipresent decision-makers.
Unfortunately, most IAS officers oversee a corrupt and inefficient system, through their entire career, without standing up and fighting for what is right. It is just a job for them, a career. They don’t go out of their gilded life of white cars, large bungalows and club memberships. A small number even do enormous damage. We believe that the principal reason for India’s poverty is not misguided policies. It is rampant loot by politicians with supporting and acquiescing bureaucrats. 
 
And, when they retire, they enjoy generous State pension and perks. School teachers may or may not get their pension, but retired IAS officers never have to face such problems. Some manage to grab land to build large post-retirement flats and bungalows worth crores of rupees, as several Maharashtra bureaucrats have done. 
 
One could argue that they are merely doing a job, like everyone else. If doctors don’t attend to patients and professors don’t teach, why should IAS officers be expected to live up to a much higher standard? Quite correct; except that if one has merely done a job all one’s life, and not made some significant change to public life that one can be proud of, why be presumptuous enough to write a memoir of such a ‘career’? 
 
We do look forward to the memoirs of bureaucrats who have made real change like GV Ramakrishna. But a reading of this book (The Insider’s View; Penguin Books; Pages 310; Rs499) shows that Javid Chowdhury is not one of them. He was a secretary of food, revenue and family welfare. While this book does give some insights on his life as a civil servant, it hardly inspires the reader. Mr Chowdhury comes from a privileged background (Doon School, St Stephen’s College) but believes in welfare socialism, the public sector, the subsidy system—anything but accountability and reward for human ingenuity and enterprise as the main drivers for progress. He seems to have seen no evil, spoken no evil and heard no evil (except the ‘neo-liberal’ ideas of the 1990s). He professes that was he was innocent of caste, gender and religious bias right until 1989, 24 years into his career. What a waste!

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