After about six weeks of a rally, the indices continued with the profit booking trend for a second week with end of the trading session on Friday. The 50-share NSE Nifty closed at 8,224.10, below the minimum support level of 8250 while the 30-share BSE Sensex closed the week at 27,350.68 points. Nifty fell 3.7 percent over last week while the Sensex declined 4 percent. BSE Oil and Gas was the sectoral index that fell the most with a 2.6 percent decline. The other sector that showed a significant decline was the Capital Goods index with a fall of about 2 percent.
GAIL India Limited registered the greatest fall at the Sensex with a 4.6 percent decline. Tata Steel fell by about 4 percent and Cairn India and ONGC followed with a 3.5 percent decline. IT shares continued to fare badly with TCS losing about 1.5 percent and HCL about 2.5 percent. The BSE saw a decline in the rates of about 1987 shares while 92 shares rose in value this week. Foreign investors are estimated to have offloaded about USD 141.5 million worth of shares in the last three trading sessions this week.
The Finance Ministry has been successful in pushing the Coal Mines Bill through Parliament on Friday while Jaitley promised that the Goods and Services Tax Bill would be introduced in the course of the next parliamentary session.
Brent crude fell to USD 63 with most major oil companies across the world showing a sharp decline. While expectations of a heartening inflation data has brought some cheer to the markets, globally worries of a further decline has kept most investors apprehensive.
Gold closed on Friday at 27,242. Global cues, however, are that the yellow metal is set for a sharp rise next week.
Funds flow into equity
Following the RBI board meeting on Thursday, Governor Raghuram Rajan has offered his unambiguous opinion that with inflation coming down, the country is slotted to see a period of growth. Investments are also set to see growth, he said this week. There may be a change in the flow of investments from gold, the traditional investment for most Indians, into equity. This he confirmed was despite the relaxation in gold import norms by the Government. The Finance Ministry shall, however, have to closely watch the current account deficit levels due to the consequent increase in gold imports. RBI Governor Rajan also assured the markets that the price of oil could fall further.
GOSF makes a resounding success
Google is incredibly happy with the results of the Great Online Shopping Festival (GOSF) that was held between 10 and 12 December. Tata Housing has recorded over 10,000 bookings in the very first day of the GOSF. According to data from CashKaro.com, online retailers saw a 450 percent increase in the number of transactions from December 8 to December 12. The report also says that about 40 percent of the products purchased are electronics and mobile gadgets. Surprisingly, about 76 percent of the online shoppers are men. The GOSD had faced staunch opposition by offline retailers till last week. Flipkart, one of India’s largest online retail sited, did not participate in the GOSF.
Coal India starts coal imports
Ending four years of import efforts, Coal India has finally managed to receive its first import of some 1.7 lakh tonnes of coal this week. The coal shall be shipped to Mundra Port in the Gulf of Kutch from Indonesia. Government policy against the import of coal had hitherto banned the import of coal considering India’s position as an exporter. This lot of coal import is likely to be supplied to Talwandi Sabo Power and Nawa power units in Punjab apart from the Neyveli Thermal Power in Tuticorin.
State-run Coal India had initially contemplated import of some 5 million tonnes of coal. However, due to a shrink in the market the quantity of import was decreased to about 0.5 million tonnes. About 45 companies had initially expressed interest in imported coal. The increase in prices due to the cost of imports had, however, led to only five orders. Among those who withdrew orders was NTPC, Coal India’s biggest customer.
Snapdeal acquires Wishpicker
Snapdeal, one of India’s largest online retailers, has decided to acquire Wishpicker. This is Snapdeal’s fifth acquisition thus far. Wishpicker is a tech platform developed last year by IIT Delhi alumni Apurv Bansal and Prateek Rathore. It allows the retail website to provide gift recommendations based on the recipient’s profile. While the financial aspects of the deal have not yet been made public, Snapdeal is upbeat about the acquisition and believes that Wishpicker will strengthen Snapdeal’s appeal to its users. As of the latest reports Snapdeal, founded in 2010, is targeting a gross merchandise value of INR 18,000 crore through sales this fiscal year.
Goods & Services Tax Bill may be tabled next session
The Government of India is likely to introduce the Goods and Services Tax Bill in the next parliamentary session. The Centre has been engaged in a deadlock with all States except one rejecting the draft Bill over differences in three key areas – entry tax, petroleum and the GST compensation mechanism. The Finance Minister has, however, promised that the concerns raised by the States would soon be resolved and that the Bill shall surely be pushed through.
The Reserve Bank of India Governor warned the Government that the ‘Make in India’ campaign could soon become concentrated on manufacturing solely for export markets and expressed his disapproval of picking out focus sectors. He said that the GST Bill would be important in determining the direction of the ‘Make in India’ campaign.
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