Will the market rally for the 8th week? Toss a coin
We had written on 8 February 2012 (http://www.moneylife.in/article/will-the-market-rally-for-a-sixth-week-in-a-row/23543.html) that the markets are likely to end the sixth week higher. Our guess was proved right, based on the probabilities at that given point in time. However, the markets have continued to surge higher, up for the 7th week, as well. We are into the 8th week now. What are the odds that the momentum and bull market will end up higher by end of this week?
We analysed all weekly closes data points in the last 21 years. We fond out that there have been 16 occurrences where Sensex moved up seven weeks in the row in the past 21 years. However, the 8th week turned out to be positive only half the number of times. In other words, the markets ended the 8th week 8 times out of 16. A perfectly random outcome. The last time it happened was in 2010, between the period 11 February 2010 and 1 April 2010. Interestingly, out of the 16 times the market was up for seven weeks in the last 21 years, the 8th week was positive only twice in the nineties.
Over the last seven weeks, the Sensex has given handsome returns of 15.4%. Since today is a holiday, we will only know how the markets will start this week by tomorrow end of day, to give us an indicator as to the likelihood of markets being positive this week, as well. With most global markets up, it could be a positive start to the week.
With the odds 50-50 this time around, the probabilities of the current upward momentum extending well into its 8th week has greatly diminished, but by no means improbable, given that market has an uncanny ability to surprise us. So what do you do? Toss a coin, instead, to check if the market will continue its bull run. You might be lucky, or not, depending on which side of the trade you're on.
The loss-making public carrier widened its losses by running with less seats while accommodating the minister's family, which was termed as ‘impropriety and favouritism in aborting the flight on the behest of an influential person or persons in violation of the rules’ by the CIC
Air India, the reluctant 'Maharaja' of the Indian aviation sector has finally admitted that it provided a bigger aircraft to ferry, the then civil aviation (and current heavy industries) minister Praful Patel's family and associates from Bangalore to Male and back. In order to keep the change of airplane and passengers name under the carpet, the Maharaja even tried to challenge the Chief Information Commissioner's (CIC) own order.
The case dates back to April 2010, when the reports about change in airplane by Air India, to accommodate the minister's kin appeared. According to report published in Mail Today on 29 April 2010, Air India deployed a larger aircraft than the scheduled one just to ensure that Mr Patel's daughter Avni, her husband Prashant Deshpande and her in-laws could fly business class to Male, the capital of Maldives. This was done under pressure from the civil aviation ministry, the newspaper said.
For the regular Bangalore-Male flight IC-965, Air India plies an Airbus A-319, which has eight business class seats and 114 economy class seats. Since seven of the eight seats on that flight were already booked, all seven members of the Deshpande family could not have been all accommodated in the business class. Therefore, a larger aircraft-an Airbus A-320 with 20 business and 125 economy class seats-was deployed for the 25th April Bangalore-Male flight that resulted in 53 seats (six business class and 47 economy class) going vacant. The same aircraft returned to Bangalore with 57 seats vacant, the report said.
Reading the newspaper report, Right to Information (RTI) activist Subhash Chandra Agrawal, on 26 March 2011, filed an application seeking detailed information of the aircraft change to accommodate the minister's family. Air India, however declined to reveal the names of the passengers on the flight citing commercial interests and invasion of privacy of an individual. It also refused to divulge details on the aircraft change saying that such decisions are taken based on its commercial requirements depending on the booked load or demand and also due to operational or engineering requirements.
Mr Agrawal challenged Air India's decision of not divulging information. On 23 February 2011, Sushma Singh, Central Information Commissioner (CIC) ordered the airline to provide the requested information to Mr Agrawal. "...public interest in disclosure of the sought for information overweighs the harm to the protected interest, as impropriety and favouritism in aborting the flight on the behest of an influential person or persons in violation of the rules, has been alleged by the appellant and in the news reports provided by him," the CIC noted in her order.
However, Air India declined to provide complete information and instead asked for a review of the decision by the same CIC, which is not possible under the RTI Act. While a review cannot be sought under RTI Act after a CIC hearing, a court stay order can be obtained. But neither did Air India give the information within the stipulated days, nor did it get a stay order from any court. In the review petition, CPIO at Air India has avoided mentioning the CIC dictat of revealing names of person(s) responsible for the decision of rolling our bigger jets on 25 April 2010 and 28 April 2010 to accommodate the in-laws of Mr Patel's daughter for their trip to the Maldives. (Read more ...Air India shields former minister's families' free ride)
Mr Agrawal challenged Air India's position of not revealing details and review of the CIC decision. His appeal was upheld by the CIC, which again directed the airline to provide details sought by Mr Agrawal. Finally, in a reply on 11 February 2012, Air India admitted that the order to change the aircraft on Bangalore-Male-Bangalore route was issued by Harjeet Sawhney, the then manager (scheduling), commercial headquarters, Mumbai through an email. (Surprisingly, earlier the airline admitted that the decision to switch the aircraft was taken by the central co-ordination cell and the decision intimated telephonically to the concerned personnel.) The email also mentions telecon between Aben Lal and FJ Vaz, the executive director for commercial of Air India.
Air India also provided list of passengers on its flight IC-965 of 25 April 2010 for Bangalore-Male and IC-966 of 28 April 2010 for Male-Bangalore sector. Both the lists include names of Mr Patel's daughter and her family.
Oil minister S Jaipal Reddy asked oil secretary GC Chaturvedi, who is also the chairman of Petronet LNG, to probe allegations that the company quietly switched to buying lean gas, which can only be used as fuel, instead of rich gas that can also produce petrochemicals and cooking gas (LPG)
New Delhi: Oil minister S Jaipal Reddy has ordered a probe into changes made in a multi-billion dollar contract for import of liquefied natural gas (LNG) from Qatar, following allegations of foul play, reports PTI.
Mr Reddy asked oil secretary GC Chaturvedi, who is also the chairman of Petronet LNG, to probe allegations that the company quietly switched to buying lean gas, which can only be used as fuel, instead of rich gas that can also produce petrochemicals and cooking gas (LPG), ministry sources said.
Petronet insiders, however, said the allegations were not true as the company was getting about 6.5 million tonnes out of the contracted volume of 7.5 million tonnes a year as rich gas from RasGas of Qatar.
While the entire 7.5 million tonnes was supposed to be rich gas as per the original contract signed in 1999, Petronet had altered the contract to advance supplies of second tranche of 2.5 million tonnes by a good five years, helping the nation save about a billion dollar every year.
Sources said after some MPs raised the issue, Mr Reddy asked the secretary in his ministry to look into the matter.
Petronet LNG, which is majority owned by state-owned oil companies, had in 1999 signed a contract with Qatar's RasGas to buy 7.5 million tonnes a year of natural gas that has been cooled to liquid form (LNG) so that it can be shipped.
The contract, sources said, was for import of 5 million tonnes of LNG at Petronet's Dahej terminal in Gujarat and 2.5 million tonnes at its Kochi facility in Kerala. All of the 7.5 million tonnes of LNG to be supplied by RasGas was supposed to be rich gas, which contains compounds like ethane, propane and butane that are building blocks for petrochemicals and LPG.
RasGas began supplies of 5 million tonnes a year of rich-LNG at Dahej in 2004. But supply of the remaining 2.5 million tonnes could not start as construction on Kochi terminal was delayed.
Sources said in 2005, Petronet management realised that India needed gas to meet its fast expanding economy and so entered into negotiations with RasGas to advance the tranche-2 volumes of 2.5 million tonnes.
They proposed to buy the entire 7.5 million tonnes a year of contract supplies at Dahej. But RasGas was not going to give into Petronet's demand so easily and stated that since all its production was committed, it can only supply lean gas or gas without ethane, propane, etc.
Petronet agreed and signed a revised deal in 2006. But it did not settle for this and entered into new negotiations asking RasGas to give all of 7.5 million tonnes of rich-gas.
RasGas relented and in 2008-09 agreed to supply rich gas for the second tranche quantity on best endeavour basis. It has been supplying about 1.5 million tonnes of tranche-2 quantity as rich gas since 2009.