Posts Tagged ‘fuel price’

Equity News Update

Economy

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•India’s food price index rose 15.53% while the fuel price index climbed 11.14% in the year to October 9. In the prior week, annual food and fuel inflation stood at 16.37% and 11.14%, respectively.

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Pharmaceuticals

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•Wockhardt has received tentative approval from the United States Food & Drug Administration (USFDA) for marketing the Fexofenadine HCI 60 mgplus Pseudoephedrine HCL 120 mg extended release tablets, which is used for treatment of seasonal allergic rhinitis without causing drowsiness.

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Oil & Gas

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•Reliance Industries is planning to take shutdown of the Crude Distillation Unit (CDU) No.1 and coker at Jamnagar refinery for maintenance and inspection for a period of three to four weeks starting from last week of October, 2010.

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•Oil and Natural Gas Corp (ONGC) has kicked off a `8,800-crore redevelopment of the southern part of its Mumbai High fields, using a cost-effective technology to  maintain output from the prime western offshore fields.

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Capital Goods

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•Larsen & Toubro (L&T) has received order worth 1,449 crore from DB Power for the Bhaskar Group company’s Chhattisgarh project. The Balance of Plant is the sum of all equipment for safe operation as well as the technical coordination of all concerned parts of a power plant.

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•BHEL has bagged contracts worth 35 crore to set up grid-interactive solar power plants of 1100 kW capacity at eight locations in the union territory of Lakshadweep. The Lakshadweep administration has also asked the company to renovate existing solar power plants of 800k Wat these islands.

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Realty/ Construction/ Infrastructure

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•Ashoka Buildcon Ltd has announced the completion and start of toll collection on its Bhandara toll road project on National Highway No. 6. The project, with a project cost of 535 crores, is the largest toll road project commissioned till date by Ashoka Buildron. With this commissioning, the company has 18 BOT projects under operation and 5 under construction.

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•IL&FS Transportation Networks Ltd has informed that the consortium comprising of 50:50 Joint Venture between the Company and Ramky Infrastructure Ltd. had been awarded a project by the National Highways Authority of India for Four Laning in the State of Assam & Meghalaya on Design, Build, Finance, Operate and Transfer (DBFOT) pattern. The Projectis on Annuity basis with a concession period of 20 years including construction period of 3 years. The cost of the Project as per loan agreements is 824 Crores and the semi-annual Annuity for the Project is72.51 Crores.

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INTERNATIONAL NEWS

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•US Industrial production was disappointing in September, declining 0.2percent, following a 0.2 percent gain in August. The September decrease came in notably below analysts’ median projection for a 0.2 percent advance. Capacity utilization edged lower to 74.7 percent from 74.8percent in August.

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•US Housing starts surprised on the upside while permits went in the other direction. Importantly, the single-family component is the one showing unexpected modest strength. Housing starts in September rose 0.3 percent after jumping 10.5 percent the prior month. The September annualized pace of 0.610 million units came in significantly above the market forecast for 0.580 million units and is up 4.1 percent on a year-ago basis.

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•Eurozone consumer confidence indicator remained unchanged in October from the previous month. The EC’s consumer confidence indicator for euro area was at minus 11 in October, same as in the previous month. The latest reading came in line with economists’ expectation. The consumer confidence index for the EU nations slightly improved to minus 11.6 inOctober from minus 11.7 in September.

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•UK retail sales volume including automotive fuel decreased 0.2% in September from August, it was smaller than last month’s revised 0.7% fall.Economists were expecting a 0.3% increase in September.

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•China’s gross domestic product grew 9.6% between July and September compared to the same period a year earlier. That is slightly above analyst expectations for a 9.5%, but marks a slowdown from the 10.3% expansion in the June quarter.

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Petrol Prices to be Revised Uniformly

The government owned oil marketing companies – Indian Oil, Hindustan Petroleum, and Bharat Petroleum – will be reviewing petrol prices on a monthly basis, and any decisions regarding changes in prices will be on consensus basis within the public sector. This means that petrol prices will be uniform at the retail pumps of public sector companies. Private companies may however choose to differ.

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However, the government has made it clear that it will not be completely deregulating diesel prices for now. It had hiked diesel prices by Rs 2 last month while petrol prices were made market determined. Earlier it was expected that despite diesel prices still involving a subsidy of around Rs 2, they will too move in tandem with crude oil prices.

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A lot of political opposition to the move along with increasing inflation may have been responsible for the retreat by the government. Diesel is used largely by the transport sector as well as the farm sector and a further price hike would therefore push up prices of almost all other products. The government is already struggling to tackle surging food prices and therefore probably wants to wait till the inflation comes down.

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The decision was taken at a meeting called by the petroleum secretary S. Sundareshan to deliberate on price revision frequency and also on how the publicly owned OMCs will coordinate on the matter. “Petrol price will be reviewed monthly after a mutual consultation among the three (government owned) oil marketing companies. There is no need for revision of prices now. We will follow this mechanism for three months from now,” said Indian Oil director S V Narasimhan after the meet.

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There will be no revision however for the current month. Also, the oil companies have not announced any particular date for price revision to prevent any hoarding by the black marketers, who may try to store the petrol in anticipation of a fuel price hike and result in problems for masses.

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With regard to the determination of price of diesel the Petroleum Secretary said, “Right from the beginning we have been saying that the price of petrol will be market-determined and the oil companies will take the decision themselves. The decision of oil companies would be based on factors like what is the competition doing and whether prices will be determined jointly or on individual basis.”

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On issue of whether the private companies like Reliance Industries and Essar too will harmonise their decisions with the government OMCs he said, “We are given to understand that everyone has adopted a wait and watch policy for next few months until the situation stabilises. At present, there is no scope for price revision of petrol.” He also categorically stated that “government was not thinking on revising diesel prices for now.”

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With regard to another crucial aspect of oil sector, the sharing of subsidy burden between companies and government he said that for the first quarter of 2010-11, the upstream companies such as ONGC and Oil India will shoulder a burden of about Rs 6,000 crore. The total under-recovery for the quarter is expected to be about Rs 20,000 crore.

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Food Price Index Rose 16.23%

Food price index rose 16.23 per cent in the year to May 15.

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The fuel price index climbed 12.08 per cent.

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Meanwhile, the speed of rise in food prices slackened from the previous week”s annual rise of 16.49 per cent.

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The fuel price inflation also slowed to 12.08 per cent from the previous week”s 12.33 per cent.

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The primary articles index was up 15.90 per cent, compared with the previous week”s annual reading of 16.19 per cent.

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Wholesale prices, however, eased in line with expectations to 9.59 per cent in April from a year earlier.

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This in turn provided further evidence that the RBI will hold off from raising interest rates at least until its next scheduled meeting in July.

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Earlier, Planning Commission Member Abhijit Sen stated that food inflation is likely to decrease to 4 to 5 % by November.

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This is from the current over 16 % after the arrival of Kharif (summer) crops.

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Meanwhile, he added that farm sector growth will be altered upwards to 0.2 % in 2009-10.

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This, however, is from the earlier estimate of minus 0.2 %.

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Prices have started falling from March after good Rabi arrival.

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Moreover, for some commodities such as onion and potatoes, the decline is very sharp.

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But, however, the overall prices are very high and after Kharif season, prices will commence to decline.

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He also said that it is quite possible food inflation will decline to 4-5 % by November this year.

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On the other hand, experts had predicted a decrease in food inflation with the arrival of Rabi crops in April.

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Mainly due to high prices of vegetables and fruits, food inflation carried on increasing and rose to 16.49 % for the week ended May 8.

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Prime Minister Manmohan Singh had expressed optimism that overall inflation would decline to 5-6 % by December.

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In addition, on farm sector growth, Sen said growth is expected to be 0.2 % in 2009-10.

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This is due to the upward revision in production in third advance estimate.

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In 2010-11, the farm sector growth is likely to be 5-6 % if met department forecast on monsoon comes true.

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Foodgrains production has been revised upwards to 218.19 million tonnes from 216.85 million tonnes quoted in the second advance estimate released in February.

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Wheat production is projected at a record 80.98 million tonnes in 2009-10.

Weekly Update 15th – 19th March

Here’s the weekly update again 🙂

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Its weekly overview of the Indian as well as of the Global economy.



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Despite volatility throughout the week, Indian market posted fifth consecutive weekly gains, the biggest stretch of weekly gains since June 2009, but closed flat on Friday erasing early gains as traders booked profits in selected stocks due to lack of triggers from global markets and as in line January IIP failed to lift sentiments of the market participants.

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On the contrary, though the broader index, Nifty closed in green but there was selling in mid cap and Small cap stocks as evident from the fact that BSE Midcap Index was down -0.51 per cent and BSE Small cap Index moved -0.79 per cent lower.

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On the Global Markets front; except Shanghai Comp., all the Asian markets closed in green.  🙂  European markets too closed in the positive terrain led by banking stocks.

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Both FTSE 100 and CAC 40 were up by 0.47 per cent and 0.42 per cent respectively. 🙂

Even mixed economic reports held the US stock market to only modest moves on Friday but gains for the week were strong.

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Uneven figures on retail sales and consumer confidence gave investors little new insight into the economy. If we talk about Indian economy, some concerns pertaining to further tightening in monetary policy after a partial withdrawal of fiscal stimulus in the budget have emerged in the light of robust manufacturing activity as indicated by IIP numbers.

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A sustained recovery in India’s industrial output which stood at 16.7% in January on a YoY basis as against 17.6% YoY growth recorded in the month of December and ballooning inflation is expected to force RBI to hike policy rates in its monetary policy review on 20’Th April.

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The food price index rose 17.81% in the 12 months to 27 February 2010, while the fuel price index was up 11.38%.

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FIIs net investment in Indian equity markets has crossed $75 billion mark. So far in calendar year 2010, FIIs have made net investments of $2.5 billion, of which $2.3 billion net flow made in last eight trading days since Union Budget 2010 held on February 26, reflecting the strong economic fundamentals of Indian economy, as well as confidence of the foreign investors in the growth and stability of the Indian market.

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For the forth coming weeks, advance tax payment by the major corporate will give an indication of fourth quarter earnings & would help market to take further direction in the coming week.

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Overall trend of world markets is up. The fall in the dollar index and rise in Euro from lower levels is giving support to stock markets.

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Nifty has support between 5030-4950 and Sensex between 16700-16400 levels. The coming week will give more clarity after the FOMC meet.

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As the rally after the budget had been swift and markets had a five week continuous rally, it seems that our markets are more in a consolidation mode before they take their next direction.

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Right now, investors are mostly following the “Wait & Watch” strategy and refraining to build heavy position at the time when market is expecting mixed outcome of economic releases and dollar index is oscillating between ranges.

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Market is waiting for clear direction. Recent downtrend in LME stocks is offset by still-slow pace of demand recovery, and we expect a range trading in base metals complex with downside bias.

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News that China has started work on its second phase of state strategic oil reserves in the southern province of Guangdong, is limiting the downside in crude oil prices.

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However, cautious trading is advised here as it appears overbought.

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Stay Tuned for More updates

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