BSE Sensex trades flat during pre-noon trade

The BSE benchmark index was trading flat and was down over 30 points in Tuesday's trade on selling pressure. At 12.17 pm, Sensex was down 32.51 points at 20861.38. Similarly, Nifty was down 9.35 points at 6195.60 during the same time.

Good buying was observed in IT, metal and public sector undertakings (PSU) sectors; while selling pressure was seen in fast moving consumer goods (FMCG) sector.

The 30-scrip sensitive index (Sensex) of the S&P Bombay Stock Exchange (BSE), which opened at 20,863.15 points, was trading at 20,893.70 points in the early morning session, down 0.19 points or 0.00 percent from previous day's close at 20,893.89 points.

The Sensex touched a high of 20,948.91 points and a low of 20,849.78 points during trade so far.

The S&P BSE IT index gained 20,849.78 points, metal index inched up by 46.92 points and PSU index moved up by 39.65 points; however, FMCG index dipped by 12.80 points.

The wider 50-scrip Nifty of the National Stock Exchange (NSE) was also trading down by 0.30 points or 0.00 percent at 6,204.65 points.

Not much of festival season in as gold runs dry

 
In India's biggest bullion market, Mumbai's Zaveri Bazaar, gold dealers are busy -- not filling orders for customers, but busy avoiding phone calls because they don't have any gold to sell.

Battling a huge trade deficit and a weak currency, the government has taken various steps this year to make it harder and more expensive for Indians to get hold of gold, the biggest item on the country's import bill after oil.

Hardly any gold came in for two months until mid-September and industry is still feeling the pinch, especially now the festival season has started, a peak period for demand.

In the bazaar, jewellers wander around trying to get hold of a dealer who can find them gold right away , and wholesalers ask the same of banks. Retailers in half-empty showrooms try to dissuade customers from asking for immediate delivery.

"Even if someone wants 10 kg, we don't have the stock. So much so that we have stopped attending client calls," said Gautam Arora, a wholesaler, who ignored at least five phone calls during a 40-minute conversation with Reuters.

The government has set a record 10 per cent import duty on gold and imposed a rule that requires 20 percent of imports to be re-exported, meaning importers need to find a buyer who will guarantee those exports before bringing in any gold.

The complexity of the rules and sagging exports -- down 60 per cent this year -- have caused supplies for domestic use to dry up. Banks are required to supply three-quarters of the 20 percent meant for exports before delivering the 80 per cent that will be for domestic use.

Turnover at RiddiSiddhi Bullions Ltd (RSBL), the country's largest bullion dealer with 110 employees, has dropped to 20-30 kg a day from about 300 kg since the new rules kicked in.

"This is due to the government policy. I don't know what they are thinking," RSBL Director Prithviraj Kothari told Reuters from his Zaveri Bazaar office, a gold plate on his desk showing he was crowned "Bullion King of India - 2013".

"Why do I have 110 people if I don't have any consignments of gold? If they come in at 8 they say, 'Sir, I am going home early', and I say OK."

Gold is an integral part of Indian culture, given as a dowry for marriages, which tend to be timed around auspicious days that are often religious festivals.

The shortage of the metal sent Indian gold premiums to more than $100 an ounce over London prices this month when demand far exceeded supply due to the Dussehra festival, one of several connected with harvests and invoking Lakshmi, the goddess of wealth.

The related festivals of Diwali and Dhanteras fall in the first week of November.

"New imports for domestic use could start in the next 10-15 days, which could coincide with Diwali and Dhanteras. But despite new imports, the supply situation will be very tight and premiums may even go up to $150," said Bachhraj Bamalwa, director at the All India Gems and Jewellery Trade Federation.

Premiums in other parts of Asia such as Hong Kong and Singapore were stable at less than $2 an ounce.

Wholesaler Arora, who works for NIBR Bullion, said some banks had begun accepting orders for delivery in 10 days.

But the supply shortage would persist as long as the government rules remained in force, Arora said. "Banks are giving stock only to big suppliers, so smaller jewellers are suffering due to this."

One side effect of the government measure will do nothing to improve the trade figures: in the six months from April, gold jewellery exports more than halved to $3.34 billion from $8 billion in the same period a year earlier.

SHOOING AWAY CUSTOMERS
India was the world's biggest gold buyer in 2012 but could lose the top spot to China this year after the clampdown.

Demand, nevertheless, is expected to stay strong, with the World Gold Council forecasting India would need up to 1,000 tonnes for the year after 864 tonnes in 2012.

Many suppliers are turning to smuggled gold, especially as that also avoids the 10 percent import duty. As a result, even smuggled gold commands a premium of $50 an ounce above London prices, according to the Bombay Bullion Association (BBA).

"I'm not getting supplies for exports, forget about for domestic use," said Mehul Choksi, chairman of jewellery retailer Gitanjali Gems (GTGM.NS), one of the largest branded jewellery retailers in the world. "Premiums are already up and they could go up even further. Some demand is being met by supplies through unofficial channels."

"As supply is very scarce, we have moved to diamond jewellery, which uses less gold content," Choksi added.

The desperate search for gold has even prompted digging under a ruined palace after a Hindu village sage dreamt that 1,000 tonnes might be buried there.

Meanwhile, those who are waiting for official gold imports are just having to turn customers away.

"We have postponed deliveries to our clients and serve only one customer each day," said Suresh Jain, a BBA director who runs a jewellery store in Zaveri Bazaar.

Indirect tax collections up 5.1 pc in Apr-Sept

 
Indirect tax collections grew by 5.1 per cent in the April-September period of this fiscal, a finance ministry official said.

Total collection of indirect taxes - excise, customs and service tax - stood at about Rs 2,28,550 crore during the first six months of 2013-14, the official said.

Excise collection dropped 6 per cent during the period to over Rs 89,000 crore, against the same period in the last fiscal year, reflecting slump in manufacturing activity.

Customs mop up was up 10 per cent to Rs 80,550 crore during the period, the official said.

Service tax collection, which has become a new focus area for revenue officials, grew by 16 per cent to Rs 59,000 crore during the period.

In September, total indirect tax collection stood at Rs 42,700 crore, up 13 per cent from the same month last year.

Government has set indirect tax collection target of Rs 5.65 lakh crore for 2013-14, up from Rs 4.73 lakh crore in the last fiscal.

Gold price up 0.72 per cent in futures trade on Asian cues

 
Buoyed by a firm Asian trend, gold prices rose by 0.72 per cent to Rs 29,500 per 10 gram in futures trade on Monday as speculators enlarged their positions.

Besides, rising demand in the domestic spot markets for the ongoing festive and wedding season too supported the rise.

At the Multi Commodity Exchange, gold for delivery in far-month February 2014 contracts rose by Rs 210, or 0.72 per cent, to Rs 29,500 per 10 gram in business turnover of 10 lots.

Similarly, the yellow metal for delivery in December traded higher by Rs 205, or 0.70 per cent, to Rs 29,685 per 10 gram in 235 lots.

Analysts said a firming trend in the Asian trade on speculation that the US Fed would not start tapering until 2014 and rising demand in domestic spot markets mainly led to rise in gold prices in futures trade.

In the national capital, gold prices went up by Rs 150 to Rs 31,650 per 10 gram on Saturday.

Globally, gold rose by $1.60, or 0.12 per cent, to $1,319 an ounce in Singapore.

BHP Billiton gives up 9 oil & gas exploration blocks in India

Global miner BHP Billiton on Monday said it has given up nine oil and gas exploration blocks in India due to its inability to carry out exploration operations there.

The company is withdrawing from those blocks because of delays in clearances, according to local media, but BHP would not confirm the reason for its decision to relinquish its interest.

"The decision to relinquish these blocks is the result of an exploration portfolio review ... there have been regular discussions and communications over the last 12 months with the Ministry of Petroleum and Natural Gas," BHP said in a statement.

The company gave up its interest in six blocks awarded in India's NELP VII bid round, in which it held 26 per cent interest and GVK held 74 per cent interest as well as three blocks awarded in the NELP VIII bid round in which it held 100 per cent interest.

BHP Billiton will keep its 50 per cent interest in its NELP IX block, operated by BG Group.

Amid NSEL crisis, MCX-SX begins search for new CEO

 
MCX Stock Exchange (MCX-SX) has begun its search for a new managing director and CEO to head the bourse, whose group entities remain embroiled in a major crisis emanating from Rs 5,600-crore payment default at the National Spot Exchange (NSEL).

The exchange was set up by Jignesh Shah-led Financial Technologies (FTIL) group, which has also promoted NSEL and commodity bourse MCX, among others.

Earlier this month, Joseph Massey resigned as MD and CEO of India's newest exchange while Shah also had to quit from its board.

In a public announcement on Monday, MCX-SX invited application from "suitably qualified and experienced" candidates for the post of Managing Director and CEO.

It is the country's newest stock exchange and began operations in currency derivatives segment from October 2008 while it commenced operations in capital markets trading in February this year.

MCX-SX said: "The candidate must be qualified in the fields of capital market, finance or management and possessing sufficient experience in related fields for at least 15 years."

The MD and CEO would report to the board of directors and would be responsible for conduct of affairs of the exchange under the direction and supervision of the board. He/she shall also be responsible to perform various functions under the bye-laws, rules and regulations of the exchange and also to comply with various statutory and regulatory requirements, it added.

The appointment will be subject to approval of Securities and Exchange Board of India (Sebi) and the candidate shall hold office for a term of three years which could be extended, the exchange said.

The candidate's age should not be more than 50 years as on October 31, it said adding that age and experience limits may be relaxed for deserving candidates at the discretion of the selection committee.

While renewing MCX-SX's licence for another one year, capital markets regulator Sebi had in September asked the exchange to set up a panel of independent directors to oversee its operations in the wake of questions being raised about 'fit and proper' status of its promoters.

After both Shah and Massey resigned, MCX-SX had said that U Venkataraman, whole-time Director, would assist the special committee of public interest directors in carrying out the functions of the exchange.

The group has seen a string of resignations in the past few weeks at its various entities.

Last week, commodity bourse MCX managing director and chief executive officer Shreekant Javalgekar also submitted his resignation.

China Q3 economic growth quickens to 7.8% yr/yr

Beijing: China`s annual economic growth quickened to 7.8 percent between July and September from 7.5 percent in the previous three months, the fastest growth this year and in line with expectations, official data showed on Friday.

Many investors have been concerned about the fragility of China`s economic revival, especially after a surprise fall in export growth in September.

The world`s second-largest economy grew 7.7 percent in the first nine months of 2013 from a year earlier, the data from the National Bureau of Statistics showed.

Other data released alongside the gross domestic product data showed industrial output grew 10.2 percent in September from a year ago, versus expectations of 10.1 percent showed in the Reuters poll.

Retail sales in September rose 13.3 percent on a year ago versus an expected 13.5 percent.

Fixed-asset investment grew 20.2 percent in the first nine months from a year earlier, versus an expected 20.3 percent. The government only publishes cumulative investment data.