Share prices to move sideways: Friday Closing Report

Look for 5,520 on the Nifty

Yesterday we mentioned that the market move today would decide the direction, especially if the Nifty falls below 5,520. Today, after the initial volatility, the index fell below its Thursday close and was range-bound in subsequent trade. We expect the market to move sideways in the days to come until it reaches the 5,520 level.   

Global concerns about the US economy and worries that the European debt crisis could spread to other countries, together with domestic inflation pressures, kept the market in the red today.

The market opened in the positive following the Asian markets that were mostly higher in morning trade. The Nifty resumed trade three points higher at 5,603 and the Sensex added 76 points to open trade at 18,694. Realty and IT stocks were in demand in early trade. Gaining strength the market soon touched its intra-day high. At the day's high, the Nifty rose to 5,632 and the Sensex shot up to 19,620. But profit booking at higher levels led the indices into the red in subsequent trade.

The market fell to the day's low in the mid-morning session with the Nifty falling to 5,563 and the Sensex to 18,513. Trade continued to be range-bound thereafter with the indices making half-hearted attempts to venture into the green. But those attempts were marred by the key European markets opening in the red. Finally the Nifty closed 19 points lower at 5,582 and the Sensex settled 56 points down at 18,562.

Markets in Asia settled mixed after Standard & Poor's late Thursday placed its US sovereign ratings on CreditWatch with negative implications. The development follows Moody's move on Wednesday to put US debt on a possible downgrade. Fears of the Eurozone debt crisis spreading to Italy also figured in the minutes of a Bank of Japan policy meeting held in June.

The Shanghai Composite gained 0.33%, the Jakarta Composite climbed 0.64%, the Nikkei 225 advanced 0.39%, the Seoul Composite rose 0.71% and the Taiwan Weighted surged 1.10%. On the other hand, the Hang Seng fell 0.30%, the KLSE Composite declined 0.28% and the Straits Times slipped 0.14%.

Back home, institutional investors were net buyers in the equities segment on Thursday. While foreign institutional investors pumped in funds worth Rs211.46 crore, domestic institutional investors invested Rs517.82 crore.


12th Plan to focus on MSMEs

The 12th Plan will also take on board the recommendations of the Prime Minister’s Task Force on Technology and Innovation

The 12th Plan will focus on ways to improve flow of fund to the micro, small and medium enterprises (MSMEs) sector which accounts for 8% of the gross domestic product (GDP).

The 12th Plan (2012-17), sources said, would try to enhance access of MSMEs to "equity capital and alternative sources of capital like angel funds/risks capital."

The sector contributes 8% of the country's GDP, 45% of the manufactured output and 40% of our exports. The issues concerning the MSME are being discussed by the sub-groups which were formed by the Working Group to recommend steps for accelerating the growth of the sector.

Besides other things, sources said, the schemes for encouraging skill development through the public private partnership (PPP) mode could also be incorporated in the next Plan. The 12th Plan will also take on board the recommendations of the Prime Minister's Task Force on Technology and Innovation.

The Task Force report has made various suggestions which include increasing fund availability, technology upgradation and skill development.

The Working Group, which is chaired by MSME secretary Uday Kumar Verma, is likely to submit its report to the Steering Committee of the Planning Commission by the end of September.

Of the 26 million MSMEs, which employ 60 million people, only 6% are registered while the rest come under the unorganised sector.


SIDBI, Bureau for Energy Efficiency to promote green technologies for MSMEs

SIDBI and BEE are working as co-implementing agencies for preparing a World Bank-funded project titled ‘Financing energy efficiency at MSMEs’

The Small Industries Development Bank of India (SIDBI) has signed an agreement with the Bureau for Energy Efficiency (BEE) to create energy efficient technologies for the MSME (micro, small and medium enterprises) sector.

The agreement will also help in creating awareness and capacity-building of local business development service providers to implement similar technologies, an official release issued said.

"The agreement will facilitate energy efficiency improvement through capacity-building among MSMEs and extend financial support for preparing investment-grade proposals for energy efficiency improvements," SIDBI chairman and managing director Sushil Muhnot said.

SIDBI and BEE are working as co-implementing agencies for preparing a World Bank-funded project titled 'Financing energy efficiency at MSMEs'. The project is also supported by the Global Environment Facility.

The main objective of the project is to improve efficiency and reduce green house gas emissions through commercial investments in energy efficiency goods and services among the target MSME clusters, the release added.

The potential energy efficiency market is estimated at over USD 3.1 billion and most of this potential lies with the 3 million SMEs which contribute to about 60% of the country's GDP.

The agreement with BEE involves developing an integrated approach with financial support to eligible proposals for adopting energy efficient technologies and measures, Muhnot said.

"In addition to reduction in direct energy intake, implementation of potential programmes can produce additional positive environmental impacts from reduced combustion of fossil fuels," he added.

The Lucknow-based state-run lender has been focusing on promoting funding clean technologies/production process under bilateral lines of credit from KfW of Germany and the Japan International Cooperation Agency.

These schemes have a two-pronged approach-concessional lending to encourage investment in green/energy efficient technologies and to generate and disseminate cluster-specific information, the release added.

Under the Japanese assistance, SIDBI has already provided assistance to over 2,000 units with aggregate assistance of over Rs800 crore for cleaner production and energy saving investments, Muhnoot said.

He added that to address environmental and social issues, the bank is planning to use an environmental and social risk management framework, called 'Small and medium enterprise finance and development project' and is being funded by the World Bank.

The project has already supported India SME Technology Services, a firm promoted by Sidbi and leading public sector banks, to prepare a carbon credit guidebook for MSMEs, update its existing basket of 800 technologies and flag them as carbon-free, clean, energy efficient technologies.

Project has initiated steps, in association with the science and technology ministry, to evolve a policy document on Technology Vision for MSMEs- 2020.


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