Archive for the ‘Wealth’ Category

Govt. Pegged Economic Growth At 7.75 Percent

Govt. Pegged Economic Growth At 7.75 Percent

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The government today pegged economic growth for the current fiscal at 7.75 per cent, higher than all previous estimates, but said high food inflation remained a cause for concern.

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Moreover, Pranab Mukherjee also said that the government could unload surplus wheat and rice stocks for open market sale.

“There are enough wheat and rice stocks. Therefore, it is proposed to make open market sale for unloading of surplus stock,” he said.

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The food inflation after surging to 19.83 per cent in the third week of December softened to 18.22% as of the week ended December 26.

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The wholesale price based inflation was 19.835 in the previous week while potato remained costly increasing as much as 110% over the last year.

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This was followed by pulses whose prices jumped by 42.21% while vegetables turned expensive by 30.97% and onion prices rose by 40.07% on yearly basis.

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“A major area of concern is high food inflation; therefore collaborative efforts of the central and state governments are required to tackle this problem” Mukherjee said at the meeting.

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Economic growth stood at 7 per cent during the first half of the current fiscal, Mukherjee said.

He pegged GDP growth for the whole fiscal at around 7.75 per cent – a number that exceeds the initial estimates of the government as well as the RBI.

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Prime Minister Manmohan Singh last month stated that returning to a speedy expansion pace after a slow 2008 due to the global economic crisis; economy is expected to rise by 7% or a little more in the current fiscal.

🙂

Indian Industry Expanded At A Fastest Rate in 25 Months :)

Indian Industry Expanded At A Fastest Rate in 25 Months

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India’s industrial output rose at a faster-than-expected 11.7 per cent in November  from a year earlier, due to stimulus-backed demand for manufactured goods, particularly consumer goods.

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Part of the industrial growth, measured by IIP is no doubt due to a low base of last year but it is mostly attributable to stimulus-driven demand.

Stimulus measures have boosted domestic demand for sure.

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However, industrial growth was just 2.5% in November 2008.

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India’s factory production in November was the fastest in 25 months, raising a debate on whether stimulus provided to spur the economy should continue.

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Meanwhile, manufactured goods, which have around 80% weight in the Index of Industrial Production, which measures industrial growth, grew by 12.7% in November 2009 compared to 2.7% in the same month a year ago.

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Within this category, consumer durable goods production expanded by 37.3% in the month against just 0.3% a year ago  while industrial output in Q1 of 2009-10 stood at 3.8% and in Q2 at 9.2%.

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Moreover, with better-than-expected performance in November,  industrial production in the first 2 months of Q3 now expanded at more than 10%, as it grew by 10.3% in October.

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As such, if the trend is maintained in December, industry would expand at faster pace in the third quarter.

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On the other hand, the continuous rise of industrial production gives enough hope that the recovery is on a firm footing.

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Though it is going to fuel the debate whether stimulus provided by the government to boost the economy should be withdrawn now or not.

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Market experts believe that with respect to stimulus, there could be some withdrawal on the indirect taxes side. This could be required to make up for the fiscal deficit.

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As part of stimulus, government had cut excise duty by six per cent and service tax by two per cent, besides stepping up Plan expenditure taking the total value of stimulus to Rs 1,86,000 crore.

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Morning News Capsules

Hello Friends, here, we bring you the latest updates from the Indian market and Industry.

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SMC Morning News Capsules

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NEWS CAPSULES

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• Backed by government stimulus measures and a low base effect,  growth in industrial output touched a two-year high in November 2009.

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The index of industrial production (IIP) grew 11.7 per cent, primarily due to growth in manufacturing (12.68 per cent in November as against 2.7 per cent last year),
fuelling a debate on withdrawal of fiscal and monetary stimulus measures.

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•  Maruti Suzuki, India’s largest manufacturer of passenger cars, launched Eeco, a multipurpose vehicle (MPV) in Ahmedabad.

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With Maruti Omni being largely used by the cargo segment, and the Versa failing to create a buzz in the market, the company needed to focus on the passenger side.

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Introduced in three variants at a price range of Rs 2.58-2.89 lakh, Eeco aims at fulfilling this gap.

Currently the company sells 550 Omni each month.

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•  Telecom major, Bharti Airtel, has announced that it has agreed to acquire 70% stake in Bangladesh-based, Warid Telecom.

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Bharti plans to make $300 million fresh investment in the company, thus taking the overall investment to $1 billion.

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The new funding will be for capacity expansion, coverage and innovative products.

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• FMCG major Dabur said it has tied up with a Belgium firm for technical collaboration to reduce carbon emissions in its plants and has invested Rs 5 crore for the purpose.

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The company said it is rolling out a host of initiatives at its various manufacturing facilities spread across India and Nepal to reduce carbon emissions and become more energy efficient.

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• Central electricity distribution firm PowerGrid would sign an agreement with Bangladesh later next month for setting up a transmission link with the neighboring country.

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Punj Lloyd has bagged orders worth Rs 947 crore from Ind-Barath Energy.

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The company informed that it has won an order for partial balance of plant and civil work on a two 350 MW thermal power project by Ind-Barath Energy, Orissa.

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• New Delhi Television (NDTV) has informed BSE that NDTV Worldwide, a NDTV Group company has entered into an agreement with Beximco Group, Bangladesh.

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The company would be providing consultancy to set tip and assist in the business management and operations of a 24-hour news and current affairs channel proposed to be launched in Bangladesh by Beximco Group.

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Infosys Technologies, India’s second-largest software services exporter, has reported a 3.6 per cent year-on-year (Y-o-Y) decline in net profit to Rs 1,582 crore for the third quarter ended December 31, 2009.

Total income, too, saw a decline of close to 1 per cent to Rs 5,741 crore.

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• Two – wheeler giant Bajaj Auto reported a smashing 189.24 per cent increase in its net profit at Rs 475.14 crore for the third quarter ended December 31, 2009.

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The company had a net profit of Rs 164.27 crore in the corresponding quarter a year ago.

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•  IT firm Mastek reported a 24.8 per cent decline in its net profit at Rs 23.54 crore for the quarter ended December 31, 2009.

It had a net profit of Rs 31.33 crore in the same period previous fiscal.

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Note : For More Latest Industry, Stock Market and Economy News and Updates, please Click Here

Fund Raising by PE and VCs to Increase by 30-40 percent in 2010

Fund Raising by PE and VCs to Increase by 30-40 percent in 2010

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Private equity (PE) players and venture capitalists (VCs) are back in the market to raise funds.

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Market experts believe that 2010 will see these players raising $13-15 billion, almost as equal to what PE players and VCs raised in 2008.

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PE players and VCs had raised $10-11 billion in 2009, though most of this was in the second half of 2009.

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Experts expect to see a 30-40 per cent rise in fund-raising this calendar year courtesy PE players and VCs.

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“Close to 45 funds are either preparing to enter the market or have already hit the road to raise funds.

While I feel that matching the level of 2007 is difficult, the year will be better than 2009,”

said Jagannadham Thunuguntla, equity head, SMC Capitals.

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Industry experts expect that this year will be governed by returns.

Many Industry experts are of view that LPs are going to focus on returns and returns will be more than 20 per cent, better than in 2009.

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“I think LPs are still trying to rework their portfolios.

It will be difficult for general partners to convince LPs to invest,” said Thunuguntla.

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Infrastructure, consumer services, education, healthcare, financial and clean technology will be the favoured sectors, say experts.

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One sector that is already in focus is infrastructure.

The players are in the process of raising close to Rs 8,541 crore ($1.78billion) worth of infrastructure funds.

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Investors will become company-specific rather than sector-specific.

Good sectors can have bad companies and so it makes sense to focus on companies,” said Thunuguntla.

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Fund-raising by VCs already seems to be gaining momentum.

Moreover Industry experts are of view that fund-raising will be more selective this year.

It will be better in 2010 than what was seen in 2008-09.

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However experts say that the number of funds that get allocation from LPs will come down significantly this year.

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Additional Directional Movement (ADX) Part 1

Hello Friends here we come up with another write up on “Commodity Corner Series”.

Topic is Additional Directional Movement (ADX) Part 1.

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Additional Directional Movement (ADX)

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We would touch upon aspects like what is ADX, what does it mean for Investors and what are the basics of ADX.

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As futures markets are volatile in nature & remain in over bought/-sold condition for a period of time, there is a need to confirm a move with an additional confirmation signal.

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It is important to predict the trend of the commodities futures & the analyzing the strength with applying technical tools.

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Reading directional signals from price alone can be difficult, & it is here where this indicator “Additional Directional Movement” provides an early signal to guide investor in right way.

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This indicator was created in 1978 by J. Welles Wilder, who also created the popular Relative Strength Index.

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THE BASICS

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ADX differentiates between strong and weak trends, allowing trader to enter only the strongest trends.

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The positive & increasing values on the Y-axis of the indicator measures how strongly price moves upward; the negative or decreasing figures measure how strongly price moves downward.

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· When the +ADX is dominant and rising, price direction is up.

· When the -ADX is dominant and decreasing, price direction is down.

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In other words, the -ADX rises when price falls, and falls when price rises.

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Next Blog we would read about what are the features of ADX and the current scenario of the ADX in the market.

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Stay Tuned for more on this.

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Note : For More Latest Industry, Stock Market and Economy News and Updates, please Click Here

US Economy to Surge Up in 2010 : Economists

World Largest Economy to Expand in 2010

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Market forecasters and analysts have put forth the view that US economy will most probably turn in its best performance this year since 2004 owing to the factor that companies have increased the investment and hiring.

With the increase in the spending of perks, also, it seems a near probability.

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Many US economists have  said that the world’s largest economy may expand 3-4% in 2010.

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As per the top economists, the rebound in stocks and rising incomes will prompt Americans to do what they do best — consume.

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Faced with dwindling inventories and growing demand, companies will soon become confident the expansion will be sustained.

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Market experts and economists believe that Household spending would pick up the steam as US economy would move into the second half of 2010.

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The overall picture for 2010 will be an economy growing rapidly enough to bring down the unemployment rate to an average of 9.6%.

The rate will reach about 9% by the end of 2010, major economists quoted.

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US employers expect to hire more new workers in 2010 than they did in 2009, a sign the US recession may be easing its grip, a research showed.

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One-fifth of employers plan to add full-time, permanent employees this year, up from 14% in 2009, according to an online job site that surveyed considerable number of hiring managers and HR professionals.

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Just 9% said they plan to cut headcount in 2010, down from 16% in 2009, according to the nationwide survey.

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The number of employers who say they’re going to add full-time workers is up from last year, and that is very good news. There’s definitely an uptick.

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India’s Merchandise Exports Rise After 13 Months of Sliding

India’s Merchandise Exports Rise After 13 Months of Sliding

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The economy really got a cheerful start to the New Year.

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After 13 consecutive months of sliding, India’s merchandise exports — which contribute a fifth to GDP — rose 18.2% in November to $13.2 billion.

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Imports remained in the negative zone declining by 2.6% to $22.88 billion.

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This has led to a lower trade gap of $9.69 billion during the month under review against $12.32 billion in the same period a year ago.

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🙂

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For April-November, exports were lower by 22.3% at $104.2 billion from a year-ago period, much lower than the 26% gap seen up to October.

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But as an indicator to a pickup in the econmic activity, contraction in imports during November was much lower than 15% seen in October.

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🙂

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But industry and analysts alike cautioned against taking the year-on-year growth in exports as a sign of firm revival.

That is because part of the growth is due to the lower base of exports last year during this period.

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Notwithstanding the lower base, it is also a fact that there has been a revival in global demand too.

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Market analysts feel that 2010 could belong to exporters provided government continue with the stimulus, particularly interest subsidy.

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Exporters however feels that it would be difficult to sustain double-digit growth as the November rise is partly due to pre-Christmas orders from abroad.

So despite the positive growth, the country’s overseas shipments in the current fiscal will be much lower than the $185 billion notched last year.

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🙂