The pilots, who struck work from midnight last Tuesday, have been demanding pay parity with their colleagues of erstwhile Air India, better working conditions and CBI inquiry into alleged withdrawal of flights from profitable routes, aircraft purchase and other issues
Mumbai: Air India (AI) services remain crippled for the eighth day today due to the ongoing pilots’ strike with the ailing airline operating just 10% of its overall flights including 10 each from Mumbai and Delhi, reports PTI.
The operations of the national carrier remained disrupted as the striking pilots refused to budge from their positions.
About 40 flights were in operation today as the airline cancelled almost 90% of its 320 daily services. Air India is suffering a loss of Rs26 crore per day on account of the stir. So far, seven pilots have been sacked and six suspended.
The Delhi High Court yesterday slapped contempt notices on nine office bearers of de-recognised Indian Commercial Pilots Association (ICPA) for disobeying its order to call off the strike, while deciding to take up the matter on 25th May.
The pilots, who struck work from midnight last Tuesday, have been demanding pay parity with their colleagues of erstwhile Air India, better working conditions and Central Bureau of Investigation (CBI) inquiry into alleged withdrawal of flights from profitable routes, aircraft purchase and other issues.
Of the total 1,200 pilots, over 800 belonging to the erstwhile Indian Airlines have gone on strike. The remaining 400, mostly operating international flights, owe allegiance to the Indian Pilots Guild.
Wall Street closed mixed on Tuesday on fears of lower earnings estimates and tracking the decline in the US markets, the ones in Asia opened lower on Wednesday
The local market is likely to see a lower opening today on lacklustre global cues. The market, which settled sharply lower yesterday on the hawkish monetary policy by the Reserve Bank of India (RBI), is expected to be weighed down as investors react to the details of the policy. On the global front, Wall Street closed mixed on Tuesday on fears of lower earnings estimates. Tracking the decline in the US markets, the ones in Asia opened lower on Wednesday. The SGX Nifty was down 23.50 points at 5,539 against its previous close of 5,652.50.
Yesterday, the Sensex and Nifty fell by 2.44% and 2.39%, taking a hard knock from the larger-than-expected rate hike announced by the Reserve Bank of India (RBI) in its annual monetary policy. This is the biggest drop in the market since 25 February 2011. The Sensex plunged 463 points to 18,535 and the Nifty dropped 136 points to 5,565. It is also for the first time since 23 March 2011 that the indices have closed below the 50-day moving average. The support for the Nifty now lies somewhere around 5,300.
Trading was range-bound and hovered about the neutral line in the mid-morning session when it also touched the day's high at about 10.45am. At the high point, the Sensex was up 27 points at 19,025 and the Nifty gained 10 points to 5,711. But as soon as details of the RBI policy trickled in, the indices slipped into negative terrain.
An across-the-board sell-off resulted in all sectoral gauges dipping into the red. In the afternoon, as two of three European benchmarks opened lower and US stock futures indicated a negative trend, the domestic indices continued to reel under pressure. Besides, increasing key rates, the central bank also underlined the need to adopt strong measures that could curb growth in the short term.
US markets closed mixed overnight on concerns of lower earnings estimates and continuing fall in crude prices. Pfizer plunged 2.8% on lower earnings, Chevron tanked 2.01% and Exxon Mobil declined 1.6%. On the other hand, Alcoa advanced 2.6% on rumours that Rio Tinto will make a bid for the metals company. MasterCard gained 2.6% on higher first quarter profit and Avon Products soared 4.5% on improved earnings due to lower costs.
In economic news, factory orders surged 3% to a seasonally adjusted $463 billion in March, as per data from the Commerce Department. The gain was the fifth in a row and beat analysts’ estimates for a 1.9%.
The Dow added 0.15 points to 12,807.51. The S&P 500 shed 4.60 points (0.34%) to 1,356.62 and the Nasdaq declined 22.46 points (0.78%) to 2,841.62.
Markets in Asia were in the red in early trade on Wednesday on lower oil prices and fresh concerns about the European debt issues. The South Korean index was lower on profit taking after recent gains.
Oil prices declined over 2% on Tuesday as gains in the dollar helped spark a technical sell-off. Brent crude for June delivery fell $2.67 to settle at $122.45 a barrel and US crude for June dropped $2.47 to settle at $111.05 a barrel.
Meanwhile, the Shanghai Composite declined 0.96%, the Hang Seng tanked 1.02%, the Jakarta Composite fell by 0.19%, the KLSE Composite slipped 0.48%, the Straits Times retraced 0.77%, the Seoul Composite tumbled 1.10% and the Taiwan Weighted was down 0.59%. The Nikkei 225 remained closed for trade.
Back home, the RBI on Tuesday said the uncertainty over issuing guidelines for new bank licences is likely to continue for some more time as it is in consultation with the government over the draft norms.
The central bank was hoping that the legislation would go through in the Budget session but it got curtailed. There is some uncertainty about the timeframe as some loose ends are still to be tied-up, RBI governor D Subbarao said.
Proposal aims to give a fillip to interest rate futures and term repo markets
Mumbai: The Reserve Bank of India (RBI) today said that it has proposed to extend the period of short sale in central government securities (G-Secs) from the current five days to a maximum of three months.
The move will provide a fillip to the interest rate futures market and the term repo market, the RBI said in its monetary policy statement for FY 12.
Intra-day short-selling in G-Secs was permitted in February 2006 based on the recommendations of the technical group on the central government securities market, PTI reports.
In January 2007, based on the feedback received, the period of short-sale was extended to five days. The apex bank now proposes to extend the period of short-sale to a maximum period of three months.
The RBI also said that foreign institutional investors (FIIs) would be allowed to cancel and re-book up to 10% of the market value of the portfolio as at the beginning of the financial year. Currently, FIIs are permitted to cancel and re-book 2% of the market value of the portfolio as at the beginning of the financial year.
The move is in response to the large positions held by FIIs, and in view of the increased depth of the Indian forex market to absorb the impact on the exchange rate, the RBI said. Detailed guidelines on this would be issued separately.