The Indian market is likely to witness a soft-to-flat opening on concerns over the geo-political tensions in Korea and the slowing pace of the global economic recovery. Tensions in Asia spooked the US markets overnight causing key indices to drop between 1% and 1.5%. Markets in Asia were mixed in morning trade on Wednesday on account of the developments in the Korean peninsula and on the lingering debt crisis in Europe. The SGX Nifty was up eight points at 5,942, as compared to its previous close of 5,934.
The domestic market was highly volatile yesterday on the back of the developments along the Korean border and over concerns over the political future of the UPA-led government, which has been rocked by corruption allegations. The Sensex opened at 19,841.42; 116.17 points lower compared to its previous close of 19,957.59. It hit an intraday low of 19,342.69-which is the maximum low in the past three months from 16 September 2010 and closed at 19,691.84, 265.75 points down (1.33%) from the previous day's close. The Nifty ended 75.25 points down (1.25%) to 5,934.75.
The US markets closed sharply lower on Tuesday following tensions after North Korea artillery shells at a South Korean island. In economic news, the Federal Reserve on Tuesday revised downwards economic growth forecasts for next year. Besides, a fall in sales of existing homes in October made investors wary of the pace of economic growth in the world’s largest economy.
The Dow tumbled 142.21 points (1.27%) to 11,036. The S&P 500 shed 17.11 points (1.43%) to 1,180. The Nasdaq declined 37.07 points (1.46%) 2,495.
Markets in Asia were mixed due to tensions in Korean peninsula and on continuing debt problems faced by members of the European Union further aggravated by rating agency S&P cutting Ireland’s credit rating. The pace of economic recovery in the US, punctuated by the Fed’s lowering of economic growth forecasts for the next year also played on investors’ minds.
The Shanghai Composite surged 0.85%, the Hang Seng jumped 1.08%, the KLSE Composite gained 0.11%, the Straits Times advanced 0.70% and the Taiwan Weighted rose 0.03%. On the other hand, the Nikkei 225 tanked 0.75% and the Seoul Composite lost 0.23% in early trade this morning. . The SGX Nifty was up eight points at 5,942, as compared to its previous close of 5,934.
A committee appointed by the Securities and Exchange Board of India has opposed listing of stock exchanges on bourses arguing that any downward movement of their share prices could hit the credibility of the market institutions.
The recommendation of the Bimal Jalan Committee, if accepted, would derail the plans of the country's two premier bourses—the Bombay Stock Exchange (BSE) and the National Stock Exchange (NSE)—to go public.
In another development, the MCX Stock Exchange on Tuesday said the recommendations made by a SEBI-appointed committee on bourses would promote monopoly and anti-competitive business practices in the market.
Without naming the largest stock exchange NSE, rival MCX-SX said the recommendations made by the Bimal Jalan committee “would continue to protect the monopolistic market structure and the perverse anti-competitive practices adopted by some.”
Maharashtra developers body says adopting carpet area norm for sale of flats requires change in Development Control Regulations
Maharashtra Chamber of Housing Industry (MCHI), a representative body of builders and developers in Maharashtra, has sought the state government's intervention to remove irregularities in the Development Control Regulations (DCR), for adopting the carpet area norm in the sale of flats.
Sunil Mantri, president of MCHI, has said in a letter to the Maharashtra government that it is difficult to implement the government's regulations because of various constraints and he sought chief minister Prithviraj Chavan's intervention in the matter.
Explaining the difficulties, Mr Mantri said, the Brihanmumbai Municipal Corporation sanctions the building permission plan based on built-up area, which covered the staircase, passage, lift well, lobby, plinth and common areas that are also taken into account for the purpose of the floor space index (FSI).
The association had requested that the urban development department shift to sanctioning the building permission plan based on the carpet area. But the department has not arrived at any decision on this as yet.
"We are willing to adopt sale of flats on carpet area basis which will enable us to implement the government's stated intention. It is very essential with a view to bringing a uniform practice for the sale of flats on a carpet area basis by all developers," Mr Mantri said. "For this purpose only a minor modification in the Development Control Regulations is needed."
Mr Mantri also said that while the government was insisting on developers following the carpet area norm, the stamp duty is being charged on basis of built-up area. He said that stamp duty charges should also be on a carpet area basis.
"One authority permits projects on built-up area and another asks developers to sell flats on a carpet area basis, this is unjustified. Hence, we urge you to intervene in the matter and accord your approval for sanction of the building permission plan and stamp duty on a carpet area basis. This approval will enable MCHI to direct all the developers under its umbrella to sell flats on a carpet area basis," Mr Mantri said.
New Delhi: The Indian government is planning to introduce a bill in an aim to regulate micro finance institutions (MFIs), which are under the scanner for charging high interest rates and aggressive loan recovery methods.
"The Department of Financial Services proposes to introduce the Micro Finance (Development and Regulation) Bill, 2010 after taking into account the views of RBI and the Malegam Committee recommendations," said Namo Narain Meena, minister of state for finance, in a written reply to a question raised in the Rajya Sabha.
While Reserve Bank of India (RBI) does not regulate the interest rates charged by Micro Finance Institutions, it has issued instructions on a Fair Practice Code to be adhered to by all Non-Banking Financial Companies (NBFCs) in terms of which the NBFCs should not charge exorbitant rates of interest and resort to undue harassment like persistently bothering the borrowers at odd hours and use of muscle power for recovery of loans, the minister said.
Separately, the MFIs have come together to form credit bureaus for exchange of information relating to borrowers and their repayment habits. "For the healthy development of the sector, it is needed to promote responsible lending by the MFIs for which credit bureaus will be formed," the Microfinance Institutions Network (MFIN) said in a statement, reports PTI.
MFIN, a body which represents 44 MFIs registered with the RBI, said that the credit bureaus would be in a position to capture data of all MFI customers and would also help in avoiding multiple lending and over leveraging.
MFIN have also laid a code of conduct which calls for limiting borrowers' group loan sizes to less than Rs50,000 as well as a whistle blower policy, it said in the statement.
MFIs have recently been under fire from various concerned government departments for charging high interest rates.