Markets in the US gained on upbeat data from the chain-store retail sector and a fall in weekly jobless claims
The Indian market is likely to open range-bound today on supportive global cues. The US markets settled higher on Thursday on the back of good data from the chain-store retail sector and a dip in the weekly jobless claims numbers. The Asian pack was also higher in early trade today, boosted by earnings numbers and a rise in material stocks. The SGX Nifty was down 13.50 points at 5,525 against its previous close of 5,538.50.
The market opened on a steady note on Thursday, riding on its own strength in the absence of any triggers from the Asian bourses. Overcoming initial hiccups and a sharp rise in the weekly food inflation numbers, the indices continued their upward journey that began on Wednesday. The market witnessed some consolidation in the noon session, with buying support improving later to take the indices to a higher trajectory in post-noon trade. Both the Sensex and Nifty finally settled off the day's highs, ending higher by 2% thus making it a second straight day of gains. Although both the key indices ended positive at 18,449 (up 359 points) and 5,527 (up 95 points) the market is not likely to run away. The short-term indicators are at extreme levels of bearishness and we expect that a slow rally has started.
Markets in the US gained on upbeat data from the chain-store retail sector and a fall in weekly jobless claims. Retail sales figures showed shoppers brushed aside bad weather to help January same-store sales beat analysts’ expectations. US chain-store sales climbed 4.8% in January. The number of US workers filing new claims for unemployment benefits fell by 42,000 to 415,000 in the week ended 29th January, the Labor Department said.
The Institute for Supply Management’s index of service industries, which covers about 90% of the US economy, rose to 59.4 in January from December’s 57.1. Analysts had predicted the figure at 57.2, with estimates ranging from 54.5 to 62.
The Dow rose 20.29 points (0.17%) to 12,062.26. The S&P 500 gained 3.07 points (0.24%) to 1,307.10 and the Nasdaq added 4.32 points (0.16%) to 2,753.88.
The Asian markets were in the green in early trade on Friday on merger news from Japan that signalled a growth in the regional economy. Nippon Steel and Sumitomo Metal Industries plan to merge to create the world’s second-largest steelmaker taking on competition from Asian rivals and shrinking demand from domestic automakers. The deal, which would see Japan’s Nippon Steel acquiring Sumitomo Metal is valued at $11 billion,
Meanwhile, Mitsubishi UFJ Financial Group Inc, Japan’s top publicly traded bank, gained 1.8% on improved earnings numbers.
The Nikkei 225 surged 1.14% while the Jakarta Composite, which opened higher pared gains and was down 0.16% in early trade.
Back home, the Telecom Disputes Settlement and Appellate Tribunal (TDSAT) on Thursday reserved order on a plea by Anil Ambani group firm Reliance Communications (RCom), which has challenged state-owned BSNL’s demand of access deficit charge (ADC) and disconnection notice for its walky service. RCom has challenged a demand note issued by BSNL on 30 December 2010, asking it to deposit Rs68 crore for two circles—UP West and Orissa—as ADC.
The South Korean steel producer is unhappy about the job quota the Orissa government is insisting on for all new projects in the state
Bhubaneswar: Though six months have passed since its memorandum of understanding with the Orissa government for a 12 million-tonne-per-annum greenfield steel mill lapsed, Posco-India is yet to reply to queries by the state government for the renewal of the MoU, official sources said on Thursday.
"Certain queries have been made to Posco-India. But it has yet to respond. Once the response is received, there should be no problem in renewing the MoU," chief secretary, B K Patnaik told journalists here. The MoU issue came up following the clearance from the environment ministry for the Posco project on 31st January.
The five-year MoU with the South Korean steel major lapsed on 21 June 2010, official sources said, as efforts to set up the steel plant near Paradip did not make headway.
"We will renew the MoU with Posco at an appropriate time," Raghunath Mohanty, minister for steel and mines, said.
Sources said that Posco-India was reluctant to accept any new clause in the MoU to be renewed as suggested by the state government. The state government has decided to reserve jobs for local people in all mega projects and wanted this to be incorporated in the MoU, sources said.
According to the new job reservation policy, all industries setting up units in the state would be required to provide at least 90% jobs in the unskilled category to local people, including families affected by the project and up to 60% jobs in the semi-skilled category. Similarly, 30% of jobs in the supervisor and managerial cadre also have to be given to local people. The new policy allows senior executive posts to be filled from the open market.
While other mega projects, including Tata Steel and Jindal, have already accepted the state's job reservation policy that has not been notified till today, Posco-India has been reluctant to accept this saying that job reservation on a geographical basis does not conform to the constitutional provisions of India.
Banks like State Bank of India had refused to facilitate payments for Iranian oil after the RBI on 23rd December clamped down on the main conduit used by the Indian companies to pay for the Persian Gulf nation imports
New Delhi: Ending a six-week long stalemate, India today decided to use the euro to pay for Iranian crude oil but will route the payment through a German bank instead of its central bank, reports PTI.
Banks like State Bank of India (SBI) had refused to facilitate payments for Iranian oil after the Reserve Bank of India (RBI) on 23rd December clamped down on the main conduit used by the Indian companies to pay for the Persian Gulf nation imports, which make up for over 12% of the nation's oil needs.
But, Iran had continued to supply oil on credit despite the outstanding amount crossing a staggering $3 billion.
"It was decided today that euro payments will be made through Hamburg-based Europisch-Iranische Handelsbank AG (EIH Bank)," a finance ministry official said after a high-level meeting called to end the deadlock.
The meeting was attended by national security advisor Shiv Shankar Menon, economic affairs secretary R Gopalan, foreign secretary Nirupama Rao and oil secretary S Sundareshan.
"SBI has been instructed to start clearing the backlog payments beginning this evening," the official said. Oil companies like Essar Oil will transfer money to SBI, which in turn will use its Frankfurt branch to route payments to EIH.
The nation's largest lender will first clear the over $2 billion payment backlog for the four-month period beginning September 2010.
An additional $1.3 billion worth of oil was bought after 23rd December, when the RBI disallowed payments for Iranian crude using a long-standing clearing house system run by the central banks of nine countries-including India and Iran-dubbed as the Asian Clearing Union.
National Iranian Oil Co (NIOC) has an account in EIH and the Central bank of Germany, Deutsche Bundesbank (DBB) had cleared it for receiving euro payments for Iranian crude.
DBB has agreed to receive euro payments for the Iranian oil, provided the importing entity or its bank issues a certificate that the money will not be used for trade in any commodity that is under UN or European sanction, the official said.
He added import of crude oil from Iran has not been banned by either UN or European Union.
EIH was suggested for routing payments even earlier but SBI had resisted it fearing its business in US might get affected. It wanted a comfort from the government and both NSA and the foreign secretary fully backed euro payments through EIH, he said.
India imported 21.3 million tonnes of crude oil from Iran in 2009-10 and imports in 2010-11 are expected to amount to around 18 million tonnes, as Reliance Industries has totally stopped using crude oil from the Persian Gulf nation.