Stocks shed early gains but close higher

Market to remain volatile till expiry of December contracts on Thursday

Stock market indices ended marginally higher on Tuesday after hitting 19-month highs during the day, but shed most of their gains towards the close of trading. The BSE Sensex ended 41 points higher at 17,402 while the NSE Nifty closed at 5,188, up 10 points.

Indian markets will remain volatile as traders roll over positions in the derivatives segment from December 2009 series to January 2010 series ahead of the expiry of the near-month December 2009 contracts on Thursday (31st December). Also, trading volumes are likely to remain low for the rest of the week as most foreign fund managers are on a year-end vacation. The market will remain closed on Friday (1st January) for the New Year holiday.

During the day, Bharti Airtel rose 2%, while Reliance Communications and Idea Cellular ended flat, on reports that the Indian telecom industry had an awesome run in 2009, adding some 170 million phone connections to take the subscriber base to nearly 550 million. India’s tele-density went up to an impressive 46.32% at the end of November 2009, against 32.34% a year ago. Meanwhile, the auction of spectrum for third-generation (3G) mobile services has reportedly been postponed by over a month and is likely to start by the end of February 2010.

Reliance Infrastructure jumped 3% on reports that its subsidiary, Reliance Power Transmission, has bagged two transmission projects worth Rs4,100 crore.

Reliance Power shot up 5% after the first 300MW unit of the company’s 1,200MW Rosa power plant in Uttar Pradesh started supplying electricity to UP Power Corporation, ahead of schedule.

Oil & Natural Gas Corporation dropped 1% following reports that the company will lend Rs4,000 crore to its overseas unit, ONGC Videsh, for investing in a gas field off Myanmar’s coast and a pipeline to carry the fuel to China.

ETC Networks jumped 5% after the company’s board approved a merger of the company with Zee Entertainment Enterprises.

Reserve Bank of India (RBI) deputy governor Shyamala Gopinath said the focus of India’s monetary policy is shifting to managing recovery and containing inflation from one concentrated on fostering growth after the global downturn. She said rising food prices were fuelling concerns of broader price pressures and the policy challenge was to address the supply-side constraints. She added that effective assessment of the inflation process and using monetary policy actions at the right time would be critical.

Meanwhile, petroleum secretary RS Pandey said the government has no immediate plans to raise fuel prices after a recent media report suggested that auto-fuel prices could be increased anytime early next year.

Indian companies have reportedly lined up equity raising plans of Rs1,50,000 crore in calendar 2010, which is close to two-and-a-half times what they raised through share sales in 2009. Earlier on Monday, prime minister Manmohan Singh said that the economy will grow at 7% or a little more in the current fiscal (2009-10).

Emerging-market equity fund inflows tripled last week as the outlook improved for developing-nation exporters, EPFR Global said on Monday. These funds attracted $1.7 billion in the week ended 23rd December, up from $571.4 million in the previous week, EPFR said. EPFR also said that this inflow added to a record $80.30 billion of investments in emerging-market stock funds so far this year, compared with outflows of $48 billion in the same period in 2008.

Asia ex-Japan equity funds also posted modest inflows of $179 million for the past week, with investors in this region rotating some exposure from smaller markets like Taiwan and Singapore to bigger ones such as China. China equity funds took in another $153 million, maintaining their record-setting pace, and dedicated BRIC equity funds also remain on track for a record-setting year after absorbing another $451 million.

India and Japan signed two important agreements on Monday for implementing the ambitious Rs3.6 lakh crore Delhi-Mumbai Industrial Corridor (DMIC) project which seeks to create integrated investment regions and industrial areas across six states. The agreements include collaborating in the development of eco cities that are environmentally and ecologically sustainable along the corridor and setting up of a project development fund to undertake activities like master planning & feasibility studies, preparing project reports and obtaining approvals and bid process management for projects.

During the day, Asia’s key benchmark indices in Singapore, Japan and China were up by between 0.04%-0.72% on the back of Japan’s industrial production surge and on reports that China has raised its economic growth forecast. However, indices in South Korea and Taiwan were down 0.05% and 0.78%, respectively.

On Sunday (27th December), Chinese premier Wen Jiabao indicated that the government is unlikely to withdraw its stimulus package until the ongoing recovery is sustained.

Japanese industrial production rose for the ninth straight month in November on increased output of cars for foreign customers, but the nation's retail sales continued to fall, signalling that Japan’s economic recovery remains fragile. As per the data released by the ministry of economy, trade and industry, the output at Japanese factories and mines gained by a seasonally adjusted 2.6% last month from October.

Meanwhile, Hong Kong’s exports rose for the first time in more than a year, helped by the global economic recovery. Exports rose 1.3% in November 2009 from a year earlier to HK$234.1 billion, the first increase since October 2008.

Imports in November also increased 6.5% from a year earlier to HK$254.8 billion.

In the US markets on Monday, the Dow Jones Industrial Average was up 27 points while the S&P 500 and the Nasdaq Composite rose by 5 points each.

According to the figures from MasterCard Advisors’ SpendingPulse, which track all forms of payment, retail sales rose 3.6% from 1 November 2009 to 24 December 2009, compared with a 2.3% drop a year ago.

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    Tamiflu not effective for serious flu

    Roche has claimed that its Tamiflu dramatically reduced hospital admissions as well as bronchitis and pneumonia. But a recent investigation by the British Medical Journal and UK’s TV Channel 4 has concluded that such claims are meritless

    Public Citizen, a US-based non-profit consumer advocacy organisation, has called for an independent review of the raw data from clinical trials funded by Tamiflu’s maker, Roche Holding AG.

    "Tamiflu is being erroneously peddled as a panacea to flu," said Dr Sidney Wolfe, director of Public Citizen's Health Research Group. "In fact, no research exists to support this (claim) in healthy adults. At best, it can modestly reduce some minor flu systems in such people for a day."

    Public Citizen claimed that the drug does not prevent serious complications from the flu and advised that it should not be used for routine control of the flu in healthy adults.

    Switzerland-based Roche, the world's largest maker of cancer drugs, had claimed that its Tamiflu dramatically reduced hospitalisations as well as bronchitis and pneumonia. However, a recent investigation by the British Medical Journal and British TV Channel 4 concluded that such claims are unfounded.

    In the wake of widespread media coverage of the H1N1, or swine flu virus, Tamiflu sales have skyrocketed. In October, 2.5 million prescriptions were filled in the US compared with just 35,000 prescriptions in October 2008. For the past 12 months, 6.8 million prescriptions were written, compared with 4.3 million in the previous 12 months, said in a report.

    In India too, Tamiflu was moderately effective for the treatment of H1N1 influenza or swine flu. “The tablets were not as effective as the company claimed it to be, but were moderately effective. The drug had side effects like diarrhoea, skin reactions and vomiting,” said Dr Mahesh Shetty, a physician based in Navi Mumbai.

    According to Indian government data, from September onwards, when it permitted the retail sale of the H1N1 drug, Roche’s Tamiflu has sold 4,47,340 tablets while all generic drugs that include Hetero’s Fluvir, Natco’s Natflu and Cipla’s Anti-flu have sold around 44,725 tablets combined in the 50-odd shops in the national capital region.

    Tamiflu is effective only if it is taken within 48 hours of getting infected. Once the lungs are damaged, the chances of survival are less. According to health officials, India’s swine flu toll has reached 880 so far.

    “Not all cases of H1N1 were serious. There was so much noise about nothing in the media. In India, many people die everyday from a disease like diarrhoea rather than swine flu,” added Dr Shetty.

    Tamiflu is mainly advised for the prevention of H1N1 virus and not as a treatment. People who showed symptoms of even fever were prescribed Tamiflu (oseltamivir), which means that patients who were not suffering from H1N1 ended up taking the drug, which caused side-effects.

    According to the World Health Organisation (WHO), over 11,500 people have died due to the H1N1 virus worldwide.

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    1 decade ago

    Relenza is an antiviral medicine. It is used to prevent and treat flu infections caused by influenza A or B virus. It will not work for colds, other types of flu, or other viral infections.

    China says billions missing from public funds

    After a nationwide audit, a national auditor has said that Chinese officials stole or misused a staggering $34.40 billion this year

    State company czars and other top officials in China have been found to have indulged in luxuries like buying fancy cars and other consumer durables at state expense, reports PTI.

    The country's national auditor is saying that officials stole or misused a staggering $34.40 billion this year after a nationwide audit was conducted, official news agency Xinhua reported.

    But now the authorities are coming down hard on corruption. Over 1,068 people including government officials have been handed over to disciplinary or judicial authorities for their roles in the missing funds, the agency said.

    "Embezzlement, waste of money and false fiscal reporting still existed in central departments, despite some improvements," Xinhua quoted Liu Jiayi, the country's chief auditor, as saying at a conference.

    With such a huge amount going missing from public funds, an alarmed prime minister Wen Jiabao told auditors to crack down hard on embezzlers.

    Misconduct included unauthorised purchase of cars and other consumer durables by government officials and agencies, Liu said at the conference.

    He said investigators recovered 16.3 billion yuan ($2.4 billion) following the audit which covered 99,000 companies, government agencies and public institutions across the nation.

    The auditor said, "We should enhance awareness among officials of the stiff anti-embezzlement laws and set up a clear accountability system."

    China announced its firm resolve last year to crack down hard on corruption as it launched a 4 trillion yuan stimulus package to halt a sharp drop in exports.

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