Sensex extends gains, up on sustained buying by funds

Extending gains for the third straight session, the benchmark S&P BSE Sensex rose 68 points in early trade on Wednesday on sustained buying by funds in select bluechips, amid a firm trend in the Asian region.

At 10.38 am, Sensex was up 1.29 points at 19805.32. Similarly, Nifty was up 0.10 points at 5850.30 during the same time.

Brokers said sustained buying by funds amid a firm trend in other Asian bourses, as investors await the outcome of the US Federal Reserve meeting, mainly boosted the trading sentiment.

The 30-share index, which had gained 71.28 points in the previous two sessions, rose further by 67.56 points, or 0.34 per cent, to 19,871.59 points on the back of gains in IT, metal, auto and FMCG sector stocks.

Similarly, the National Stock Exchange index Nifty moved up by 18.85 points, or 0.32 per cent, to 5,869.05 points.

IT stocks such as TCS, Wipro and HCL remained in demand as the rupee weakened further against the dollar.

Among other Asian markets, Hong Kong's Hang Seng index rose by 0.14 per cent, while Japan's Nikkei gained 0.70 per cent.

The US Dow Jones Industrial Average ended 0.23 per cent higher in Tuesday's trade.

Rupee down 9 paise to to 63.46 against dollar in early trade

Renewed dollar demand from importers and appreciation of the US currency led the Indian rupee fall by 9 paise to 63.46 against the dollar in early trade on Wednesday at the Interbank Foreign Exchange market.

Besides dollar's gains against other currencies, as investors await the outcome of a US Federal Reserve meeting, increased demand from importers for the American currency mainly put pressure on the rupee.

However, a higher opening in the domestic stock market, capped the losses, forex dealers said.

The local currency fell by 54 paise to close at 63.37 against the US currency in the previous session even as stock markets posted gains.

Meanwhile, the BSE benchmark Sensex rose by 67.56 points, or 0.34 per cent, to 19,871.59 in early trade on Wednesday.

YSRCP leader offers to buy N Chandrababu Naidu's bungalow for Rs 2 cr

ONGOLE: Mocking Telugu Desam chief N Chandrababu Naidu's claims that his bungalow at Jubilee Hills in Hyderabad is worth only Rs 23 lakh, YSRCP senior leader Balineni Srinivasa Reddy on Tuesday said he was ready to purchase the property for Rs 2 crore.

Balineni dared Naidu to get ready to sell his bungalow as he would be getting nearly 800% profit on the original value. Speaking to reporters, Balineni pooh-poohed the Naidu's claims on his assets saying that the TDP leader was never fair despite people rejecting him twice.

He demanded that Naidu come out with an explanation as to why he was shying away from a probe into his wealth if he really owned only such meagre properties as he listed at the media briefing.

He said every contesting candidate would give an affidavit to the election commission with the list of assets and other valuables owned by them at the time of election itself and there was nothing new in Naidu's claims.

He said Naidu was taking time to only divert the attention of people from serious issues like the division of the state.He asked Naidu to explain as to why he cancelled his tour in Samaikyandhra the region and chose to visit Delhi to focus on Jagan's assets.

The YSRCP leader took strong objection to the words used by Naidu with regard to his allegations against Jagan. "While every leader in public life should behave decently, people would expect more decency from a person who ruled the state for over nine years. It is unfortunate that Naidu has stooped to such a level after realizing that people were not with him," he added.

he RBI cracked down on offshore foreign exchange trading by Indians through online trading websites, asking banks to report any such remittances to the regulator.

In a circular issued late on Tuesday, the Reserve Bank of India (RBI) asked banks to advice customers not to undertake forex trading on foreign websites that offer currency contracts by accepting margins through credit card and online money transfer mechanisms.

The RBI also asked banks to close the credit card or online bank account of a customer that is found to be in violation of the rule.

The rupee has been hard hit in this summer's rout of emerging currencies, losing around 20 percent of its value against the dollar at one point, and significantly increasing the burden of Indian companies' dollar debt.

The central bank has been trying to curb the offshore rupee market by asking banks to cut down on overnight positions as well as asking foreign institutional investors to produce documentation from clients in order to hedge their currency risk in the onshore forward markets.

The central bank has already reduced the limit for remittances made by residents to $75,000 from $200,000 per financial year.

5 reasons why stock markets think Modi is good for them

 
Shishir Asthana in Mumbai

Narendra Modi's elevation as BJP’s candidate for prime minister’s post was officially announced post market hours on Friday. However, by noon it was already clear that his name would be announced by evening.
Some expected the market to react to the event but it did not. And it is unlikely that it will, for the simple reason that he is not the prime minister, yet. Having said that, many in the markets and Corporate India world prefer to see him over anyone else as the next prime minister of the country.
We look at some of the reasons quoted by the market and why it senses a bullish undertone in Modi’s candidature announcement.
A survey carried out by ET CEOs Confidence before Modi’s candidature was announced suggested that an overwhelming three-fourths of the 100 CEO’s surveyed prefer Modi as the next prime minister.
Rahul Gandhi bagged to get votes of only seven CEOs.
Corporate India has been at the receiving end of ‘policy paralysis’. The report says CEOs have voted for a strong leadership, intent, decision and action, which Modi has demonstrated in Gujarat. Rahul Gandhi has no such claims to his name.

Sign in | Create a Rediffmail account Rediff.com » Business » Rajan meets PM, FM ahead of monetary review Rajan meets PM, FM ahead of monetary review

Days before his first monetary policy review, Reserve Bank of India (RBI) Governor Raghuram Rajan met Prime Minister Manmohan Singh and Finance Minister P Chidambaram on Tuesday. 
The meeting also comes at a time when the US Federal Reserve is expected to take a call on tapering of the bond-buying programme known as quantitative easing.
“RBI has constant consultations with the finance ministry. This meeting was part of that. We discussed a whole gamut of issues,” Rajan told reporters on Tuesday after meeting Chidambaram.
Later, during the day, the government hiked import duty on gold jewellery to 15 per cent from the existing 10 per cent in an effort to curb the spiralling current account deficit (CAD) that touched an all-time high of 4.8 per cent of the GDP in FY13.
A six-month high inflation in August has already made things tough for Rajan at a time when industry is demanding cut in the policy rate to boost growth.
Inflation rose 6.1 per cent in August from 5.8 per cent in July, driven by expensive food items, particularly onions, which saw the rate of price rise skyrocketing to 244.6 per cent from an already high 119.4 per cent.
According to a report by Dun and Bradstreet, RBI is expected to maintain a status quo on the policy rate. Ironically, onion prices can’t be brought down by interest rate policy.
However, that may desist Rajan from easing the central bank’s monetary stance in the mid-quarter review on the 20th of this month, economists said.
India’s economic growth crashed to a four-year low of 4.4 per cent in the first quarter of 2013-14.
On the other hand, inflation in manufactured products further fell to 1.9 per cent from 2.81 per cent, despite depreciation of the rupee, increasing imported inflation. This showed that demand in the Indian and global economy remained subdued.
Usually, it is manufactured product inflation on which RBI focuses its attention; it is core inflation within manufactured item inflation that RBI is usually concerned.
The core inflation relates to manufactured items sans food articles. It fell further to 1.9 per cent in August from 2.3 per cent.
The low rate of price rise in manufactured items and core inflation should have been ideal conditions for RBI to cut rates, but the party is being spoilt by food articles.

Markets volatile ahead of FOMC outcome

Markets have turned volatile in morning deals as investors will be counting on the Federal Reserve to launch only a modest scaling back of stimulus later in the day.

At 1055 hours, the Sensex was up 19 points at 19,823 and the Nifty was flat at 5,853.

The gains were aided by Reliance Industries, ITC and HUL.

In the broader markets, the mid and smallcap indioces advanced and was up 0.3-0.5%.

On the sectoral indices, IT, Power and Auto indices were the only indices in the negative.