Nifty, Sensex, Bank Nifty may rally a bit - Weekly closing report

If this week’s lows hold and Nifty closes above 8,030, it may recover some of this month’s losses


The S&P BSE Sensex closed the week that ended on 12th June at 26,425 (down 343 points or 1.28%), while the NSE’s CNX Nifty closed at 7,983 (down 132 points or 1.62%). Previous week we had mentioned that 50-stock Nifty continues to remain weak and a close above 8,200 is needed for the down move to end temporarily.
The 50-stock index opened Monday marginally higher at 8,124 and immediately hit the day’s high, but later was pulled lower. The benchmark moved down gradually and closed in the red for the sixth consecutive session. That day, oil cartel Organization of the Petroleum Exporting Countries (OPEC) had decided to keep its collective output level unchanged at 30 million barrels a day. This was the second time in six months that it decided to take no action amid a global glut of crude and weak oil prices. 
The Reserve Bank of India (RBI) on Monday issued a notification allowing banks to seize control of a company if a debt restructuring fails and sell their stake in the defaulting firm to recover dues. 
On Tuesday, the Nifty moved in a narrow range for the entire session. Railway Minister Suresh Prabhu said that the Indian government will invest Rs8.5 lakh crore over the next five years to develop India’s railway services. This is expected to kickstart related manufacturing. 
This downtrend in the Nifty was broken on Wednesday as the 50-stock index gained 102.05 points (or 1.27%) to close at 8,124.45. Sugar stocks had something to cheer about that day. The Union Cabinet approved Rs6,000 crore interest-free loan to sugar mills for making payments to cane farmers. Cane arrears amounting to Rs22,000 crore of farmers are still pending. Sugar prices both in domestic and global market have fallen to the lowest levels in the last six years. India's sugar production is estimated to touch all time high of 28.3 million tonnes (MT) in 2014-15. 
The RBI laid down draft rules for companies to sell rupee bonds offshore, setting a limit on the price of the bonds at 500 basis points above government bonds of similar maturities. The price cap is not particularly restrictive, but the appeal of the bonds to offshore investors is likely to be limited for now, analysts said. The value of the rupee is uncertain as an increase in US interest rates begins to look more likely.
On Thursday, the 50-stock benchmark opened in the green and immediately hit the day’s high. This was followed by Nifty making a gradual down move. The benchmark lost 159 points and closed Thursday near the day’s low. 
India is on the path to emerge as the fastest growing economy on the World Bank’s growth chart of major economies for the first time. In its latest report, the World Bank expects India to grow at 7.5% in 2015, outpacing China, which is poised to grow at 7.1%. The collapse in commodity prices has been a boon for the country. Concerns over the current account deficit, fiscal deficit and inflation have all dissipated with the fall in oil prices. This, coupled with reforms has raised confidence in the economy adds the report.
On Friday, the US government has reportedly opened an investigation against two of the biggest Indian outsourcing companies for possible violations of H1-B visa rules. The Department of Labour has opened the investigation against Tata Consultancy Services (TCS) and Infosys Ltd for possible violations of rules for visas for foreign technology workers under contracts they held with an electric utility Southern California Edison. The move by the Labour Department comes days after reports that hundreds of employees at entertainment giant Walt Disney were laid off and replaced with Indians holding H1-B visas.
India's financial market regulatory framework on Friday got the top-most ratings from the global bodies of banking and capital market regulators, with RBI and SEBI being rated better than their peers in China and the US. In the latest global 'assessment study' of the regulatory framework for financial market infrastructures across the world, only six countries, including India, have got the highest score of 4 for all eight parameters on a scale of one to four. The other five countries are Australia, Brazil, Hong Kong, Japan and Singapore. The 'Rating Level 4' means that RBI and Sebi have all regulatory measures "fully in force".
The CNX Nifty closed Friday at 7,982.90. 
For the week, Nifty has closed down 1.62%. Over the week, the S&P BSE Sensex has closed down 1.28% at 26,425. 
Out of the 27 main sectors tracked by Moneylife, top five and the bottom five sectors for this week were:


Bombay High Court to hear Nestle plea against Maggi ban June 30

The court on Friday issued notice to the Food Safety & Standards Authority of India and other respondents and posted the matter for next hearing June 30


The Bombay High Court on Friday declined any relief to Swiss multinational Nestle, which has sought a judicial review of the Indian food safety regulator's order banning its top-selling nine variants of Maggi instant noodles on health issues. It will hear the plea June 30.
The court on Friday issued notice to the Food Safety & Standards Authority of India and other respondents and posted the matter for next hearing June 30.
Among other things, Nestle has urged the court to quash the June 5 FSSAI order asking the company to withdraw and recall its Maggi variants from the Indian market - which the company complied with.


Nine AAI officials arrested for CISF trooper's murder

The body of 44-year-old CISF jawan A.S. Yadav, was flown to Mumbai from Kochi on Friday morning, from where it would be flown to his hometown Varanasi


Nine Airport Authority of India (AAI) officials were on Friday arrested on charges of culpable homicide not amounting to murder in connection with the death of a CISF trooper in a brawl at Kozhikode airport.
B. Santhosh, a member of Kerala Police probe team probing the Wednesday night brawl between Central Industrial Security Force and Airports Authority of India officials, told IANS that all nine accused - attached with fire and rescue department - would be produced before a magistrate on Saturday.
The body of 44-year-old CISF jawan A.S. Yadav, was flown to Mumbai from Kochi on Friday morning, from where it would be flown to his hometown Varanasi.
"The arrests were made after checking CCTV footage at the airport several times. The probe is continuing and as and when more evidence is secured, further arrests will be made," said Santhosh, a circle inspector attached to Kondotty police station in Malappuram district, where the case was registered.
A silver nitrate test conducted on CISF inspector Sitaram Choudhary's pistol, from which the shot that killed Yadav was fired, led police to conclude that a scuffle occured between CISF and AAI officials, which attracted the charge of culpable homicide and not murder. 
Additional Director General of Police N. Shankar Reddy, in a report submitted on Friday to state police chief T.P. Senkumar, observed that since only officials of different agencies at the airport were involved in the scuffle and there was no trespass by outsiders, the incident could not be considered breach of security.
Sources said Reddy's report, based on CCTV footage at the airport, would be forwarded to the centre.
The visuals reportedly show angry CISF personnel damaging property inside and outside the airport after coming to know of Yadav's death. A case has since been registered against CISF personnel for vandalism.
Kerala Police had put at least 15 officials attached with fire and rescue department under watch since Thursday morning.
Three officials, including CISF inspector Choudhary, are recovering at the hospital.
Apart from Kerala police, other agencies operating at the airport are also preparing reports on the shooting.
The union home ministry, which has taken a very serious note of the incident, is expected to call a meeting of officials of different departments/agencies to ensure that such incidents are not repeated at other airports in the country.
Skirmishes have been reported between officials of CISF and other government departments/agencies at other airports in India in the past.




1 year ago

Karippur airport is smugglers paradise. Only NIA or CBI inquiry can unearth what exactly happened there.

Many believe that there is more to this than meets the eye. Though Karippur is known as Calicut airport it is located in Malappuram District, an IUML (Indian Union Muslim League) stronghold.

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