The Nifty’s short-term range is between 4,943 and 5,100
The Indian market opened in the negative in line with its Asian counterparts. The Asian markets were down on persistent selling pressure due to worries about the US recession and the worsening euro zone debt crisis. The Sensex and Nifty opened at 16,664 and 4,993 respectively.
Singapore's finance minister said on Tuesday that a global recession looked more likely than not and a Chinese official acknowledged that China's growth may slow to a 10-year low, highlighting Asia's rising concern over its exposure to US and European risks.
During the pre-noon session, the market slipped to its intraday low. However, soon afterwards, the positive opening of the European bourses helped the indices to recover. The Sensex moved up sharply from 16,488 to 16,895, while the Nifty moved from 4,943 to 5,073.
In yesterday's closing report we had mentioned that due to the negative global issues the Nifty may fall to the level of 4,965. It took support below that level and rallied sharply. The Sensex closed at the day's high at 16,863, up 149 points, and the Nifty at 5,064, up 47 points. If the Nifty holds on to 5,020, we can expect the index to reach the level of 5,100 and climb further up to 5,200. The NSE saw a huge volume of 71.16 crore shares traded today.
Among the Asian indices, Jakarta Composite gained 0.62%, Hang Seng gained 0.48%, Straits Times gained 0.04% while Taiwan Weighted lost 2.44% and Nikkei 225 lost the most 2.21%
The European Central Bank is expected to keep its key interest rate unchanged at 1.5% at its monthly policy meeting on Thursday. On the same day, the Bank of England's monetary policy committee is also expected to maintain its key benchmark rate at 0.5%, the thirty-first consecutive month at such a rate.
Along with this, some positive news on the domestic front also helped the Indian market.
The government says that it will try to restrict its expenditure to the budgeted levels in the current fiscal year to March 2012. In February, the government had budgeted Rs12.60 trillion ($273.10 billion) expenditure for the current fiscal. Any increase in certain components is proposed to be made from savings in other components of expenditure.
On the other hand, the minimum mandatory amount of deposits that banks need to set aside to invest in government bonds needs to come down gradually, Reserve Bank of India (RBI) governor Duvvuri Subbarao said today, sparking concerns of excess supply of gilts in the secondary market.
The RBI governor also said that the central bank is looking to re-launch inflation-indexed bonds. These are floating rate bonds linked to the inflation rate and such bonds help investors to shield their investments from mark-to-market volatility.
The major gainers on the Sensex were Reliance Industries (up 4.05%), Mahindra & Mahindra (up 3.31%), Jaiprakash Associates (up 2.79%), whereas DLF was the major loser (down 4.43%). Other losers were Sun Pharmaceutical (down 2.40%), Bharti Airtel (down 1.81%). As many as 19 stocks in the Sensex ended in the green. The Nifty had 31 stocks in the positive and 19 stocks in the negative.
Meanwhile, BP Plc, which is buying a 30% stake in 21 oil and gas blocks of Reliance Industries, today said that it is confident of raising output from the key gas fields in about two years.
Among the BSE sectoral indices, BSE Oil & Gas was the major gainer (up 2.78%), followed by BSE IT (up 1.16%), BSE Capital Goods (up 1.09%). The major loser was BSE Realty which dropped by 2.04%.
On Monday, the Union Cabinet approved the Land Acquisition Bill, which seeks to lay down norms for increased compensation to land owners. The Bill, which will be introduced in parliament on Wednesday, would replace a 117-year old law. The proposed legislation integrates land acquisition, rehabilitation and resettlement, defines public purpose clearly, has a clause for retrospective effect and draws timelines for compensation.
The banking regulator today announced 10 points that banks must work on to improve services for customers
The Reserve Bank of India (RBI) today announced that banks must issue certificates for tax deduction at source (TDS) duly completed, for account holders, and dispatch to their mailing addresses.
This was one of the decisions taken at its annual conference on banking ombudsman that was held on Monday. The RBI also listed nine other action points to improve bank customer services, which includes pre-payment charges on floating rate mortgages, providing customers a view of account using technology and creating awareness of the banking ombudsman scheme.
TDS has been a big harassment for customers and not too long ago Moneylife Foundation had sent a memorandum on the TDS matter to the finance ministry and the RBI on the issue. The memorandum to the RBI highlights the TDS problem for bank depositors and suggests that income from fixed deposits should be exempt from tax. It also proposes that banks found to be deficient in services, wrongful deduction of tax, not providing accurate tax certificates, or uploading inadequate or wrong information, should be awarded exemplary punishment either by the banking ombudsman or the RBI. (Read, ‘Moneylife Foundation sends memorandum on TDS to the FM, RBI’.)
Among the other issues that have been listed is the need to provide a long-term fixed rate housing loan, compensation for loss due to unauthorised transactions through ATM/Internet and proper monetary compensation for mental harassment suffered by the customer.
The RBI stated that "banks must not recover pre-payment charges in floating rate loans. Banks may offer long-term fixed rate housing loans to their customers and address their asset liability mismatch (ALM) issues by recourse to the interest rate swaps market. Floating rate loans pass on the interest rate risk from banks which are much better placed to manage it, to borrowers and, thus, banks only substitute interest rate risk with potential credit risk. The bank will, however, be free to recover / charge appropriate pre-payment penalties in the case of fixed-rate loans."
The Indian Banks' Association (IBA) has been asked to standardise the most important terms and conditions of at least 10 important banking transactions and circulate among banks for adaptation. It also said that banks should initiate the process of providing one view of the bank account, including deposits, loans, etc, using technology such as core-banking solutions and complete this within a year.
The RBI said that "under the Banking Ombudsman Scheme, banking ombudsmen will annually share with the local media, information regarding complaints received and resolved, including important cases and awards given," towards creating awareness.
On disputes in ATM/Internet-based transactions, the RBI said, "In the event of any monetary dispute involving the customer and the bank, the onus should be on the bank to prove the customer's negligence or mistake. The customer must be compensated for losses arising out of customers' non-authorised transactions."
The action points lists the need for creating awareness of customer services in banks through a series of events to be conducted by the RBI, in which bank customers, bank officials and banking ombudsmen will participate.
The RBI also highlighted the issue of monetary compensation for mental harassment suffered by bank customers and it is examining the issue along with the IBA. "Issues that may receive attention in the analysis would be whether only actual loss should be considered for compensation, whether mental harassment issues can be codified for compensation, and whether compensation should be capped, or whether the policies of the banks' boards on compensation should include mental harassment as a ground for compensation," the RBI stated.
It has also asked banks to initiate steps to incorporate in their code of 'Fair Practices to Customers', insurance of some reasonable amount on their customers' credit and debit card transactions, providing periodical loan statements to small borrowers, and conveying to borrowers information on the annualised all-in cost (annual effective rate) on their loan accounts.
The RBI has also asked banks to give their views on the recommendations of the Damodaran Committee for immediate implementation.
Judge asks Delhi police to respond to bail applications; posts hearing to 19th September
New Delhi: In a dramatic turn of events in the 2008 cash-for-votes scam, Rajya Sabha member Amar Singh was today arrested when he made appeared before a local court and sent to jail.
The former Samajwadi Party leader had earlier in the day asked the court through this advocate, to be exempted from appearance on medical grounds.
Mr Singh, 55, was not allowed bail and instead the court ordered that he be taken into custody and to Tihar jail. Special Judge Sangita Dhingra Sehgal remanded Mr Singh in judicial custody for 14 days.
The court also rejected the bail application of former Bharatiya Janata Party members of parliament Faggan Singh Kulaste and Mahabir Singh Bhagora, who also appeared before the court in response to the summons for their alleged role in the episode.
Sudheendra Kulkarni, former aide of BJP leader LK Advani, who has also been chargesheeted in the case, did not appear in court today and his lawyer requested the court for time as Mr Kulkarni is abroad.
In the court this afternoon, Mr Singh made a strong plea to be allowed bail as he had only recently undergone a kidney transplant in Singapore and required round the clock medical care.
"I lost my kidneys and I am now living on borrowed kidneys. There are hazards of being in public life and there is infection in my urinary track which is dangerous for my borrowed kidney," Mr Singh said.
However, the judge went through Mr Singh's medical reports that he had handed over to her and said that the documents did not show his medical history after September 2010. Responding to the judge's statement, Mr Singh said, "There was little time today. So I could not get all the reports."
Rejecting the bail plea of all the three accused, the judge said, "The grounds for interim bail in all three applications are similar as (those) for regular bail and will be considered at an appropriate stage. File reply. The accused Amar Singh, Faggan Singh Kulaste and Mahabir Singh Bhagora are taken into custody and will be produced on September 19."
"Every application for bail will be decided after replies are filed, because grounds for interim bail are same as in the regular bail," the judge said, while asking the Delhi Police to file its reply to the bail petitions.
Arguing for bail on behalf of Mr Singh, advocates Amrendra Sharan and Hariharan said, "There is nothing in this case and there is high probability that ultimately the accused will not be convicted and they may even be discharged. There is no apprehension that Singh will tamper evidence or abscond."
Mr Sharan, a former additional solicitor-general, said he has also been cooperating with the Delhi Police during the investigations. The defence counsel said that he has decided to appear before the court despite his ill health and this "good conduct also calls for grant of bail."
The prosecution, however, told the court that the bail plea should be decided on merits only and that if the plea is considered, points like the standing of the accused in society, gravity of offence and the ability to influence witnesses must also be considered.