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Business News |
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 Sensex closes flat |
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NEW DELHI, July 3: A benchmark index of Indian equities markets on Tuesday closed just 26 points higher, shedding most of the gains made earlier in the day. FMCG, IT and power stocks came under selling pressure.
The 30-scrip sensitive index (Sensex) of the Bombay Stock Exchange (BSE), which opened at 17,457.95 points, closed at 17,425.71 points, up 0.15 per cent or just 26.73 points from its previous close at 17,398.98 points.
The Sensex touched a high of 17,526.82 points and a low of 17,351.50 intra-day. The BSE midcap index rose 29.65 points while the smallcap index gained 52.69 points.
The wider 50-scrip S&P CNX Nifty of the National Stock Exchange ended 0.18 per cent higher at 5,287.95 points.
The BSE FMCG index was down 36.99 points, while the IT index and the power index were down 28.88 points and 2.07 points respectively.
The consumer durable index, however, was up 187.35 points, followed by the realty and PSU index which were 33.53 and 75.10 points higher respectively.
Major Sensex gainers were Bharti Airtel, up 3.11 per cent at Rs 319.50; Hindalco Inds, up 2.27 per cent at Rs 123.85; Coal India, up 1.96 per cent at Rs 356.60; HDFC, up 1.96 per cent at Rs 674.15; and Gail India, up 1.87 per cent at Rs 361.85.
The main losers were BHEL, down 1.59 per cent at Rs 231.40; Jindal Steel, down 1.46 at Rs 451.10; TCS, down 1.43 per cent at Rs 1,242.20; ITC, down 1.30 per cent at Rs 246.85; and Hindustan Unilever, down 1.04 per cent at Rs 442.40.
The markets had begun trading on a strong note on positive global cues.
In the Asian region, the Japan’s Nikkei closed up 0.70 per cent, while Hong Kong’s Hang Seng gained 1.51 per cent and China’s Composite index rose 0.14 per cent.
At the closing bell here, European markets were trading in the green. France’s CAC was 0.12 per cent up, while Germany’s DAX and Britain’s FTSE 100 were trading 0.57 per cent and 0.27 per cent higher respectively. (IANS) |
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| Insurers to discuss revision in health, motor insurance |
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CHENNAI, July 3: A key panel on the non-life insurance sector will be meeting in Hyderabad on Wednesday to discuss the issue of an upward revision in health and motor insurance premium rates.
Members of the General Insurance Council of India will also chalk out a strategy to convince the Insurance Regulatory and Development Authority (IRDA) regarding its concerns on these and various other issues concerning the industry.
“A meeting of the General Insurance Council has been convened in Hyderabad tomorrow (Wednesday). Apart from other routine matters, the major issue that would be discussed at the meeting is the need for an upward revision in health and motor insurance premium rates at least to cover the inflation,” an industry official said, preferring anonymity.
At a time when the premium rates for all other insurance products have been detariffed or freed, it is still a wonder as to why the IRDA wants to retain a say in respect of health and motor third party insurance covers.
According to industry officials, the IRDA permits an insurer to revise its health insurance premium once in three years.
“While the annual medical inflation is around 15 per cent, the insurers suffer from inadequacy of premium and in three years a product becomes unprofitable. At the macro level, the question is whether the health and motor insurance premium to be decided by administrative fiat of the regulator when it is market play in respect of other lines of business,” the official remarked.
Similarly, in respect of motor third-party insurance, the companies start selling their policies with a premium deficit of around 40 per cent while the loss ratio is more than 100 per cent.
Despite repeated attempts by IANS, IRDA member (non-life) M Ramprasad was not available for comment. (IANS) |
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| US stocks end mixed |
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NEW YORK, July 3: US stocks ended mixed on Monday as the latest weak manufacturing data added to hopes that the Federal Reserve could launch more stimulus policies to bolster the economy, Xinhua reported.
When the market closed, the Dow Jones industrial average dipped 8.70 points, or 0.07 per cent, to 12,871.39.
The Standard & Poor’s 500 was up 3.35 points, or 0.25 per cent, to 1,365.51. The Nasdaq Composite Index gained 16.18 points, or 0.55 per cent, to 2,951.23.
Major indexes started the day on strong note as investors still cheered the progress in Europe on tackling the region’s debt problems.
During last week’s summit, leaders of European countries agreed on a batch of positive steps to deal with the debt crisis.
Investors were especially pleased to hear that the eurozone’s two bailout funds, known by their acronyms EFSF/ESM, will be able to recapitalize banks directly, rather than first handing over the money to the government of the country where they are based.
The hopes for Europe gave a huge boost to the market on Friday and continued to help the market after the weekend.
However, stocks erased gains in midday trading after latest data showed the US manufacturing sector contracted for the first time since 2009.
According to the Institute for Supply Management, its monthly index fell to 49.7 in June from 53.5 in the previous month.
The reading, which was below 50, indicates contraction in the sector, marking the end of almost three years of growth in domestic manufacturing.
Adding to the concerns, the index’s new orders component which is a forward-looking indicator, fell 12.3 percentage points in June to 47.8, which was also the first contraction in more than three years.
Stocks regained momentum afterwards as investors were hoping the poor data added to the chance that the Fed may finally step in and launch another round of quantitative easing measures in its policy-making meeting at the end of the month. (IANS) |
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| 'World Bank must help tackle global growth risks' |
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WASHINGTON, July 3: The World Bank has an economic and moral imperative to help address risks to global growth, no matter where they emerge, new World Bank group president Jim Yong Kim said here.
A strong global economy benefits all countries, and a weak global economy makes all countries vulnerable, Kim said in a statement released on Monday, his first day on the job at the Washington-based agency.
“The global economy remains highly vulnerable. We need to boost confidence in markets and within the private sector. And we need to boost confidence among citizens that our economic system and policies can deliver more sustainable, fair and inclusive economic growth,” said the former president of Dartmouth College.
“My immediate priority will be to intensify the World Bank’s efforts to help developing countries maintain progress against poverty in these volatile times,” Xinhua quoted him as saying.
It is urgent that European countries take all necessary measures to restore stability because their actions will impact growth in all regions of the world, he added.
The Korean-American public health expert also stressed the importance of working with World Bank clients and partners to create a new economic firewall – one that protects people in developing countries against shocks.
“The World Bank substantially increased its lending during and after the global financial crisis. We must continue to build more effective and sustainable ways to ensure citizens have basic income protection, and access to education, health care and energy,” he said.
During a media roundtable meeting held on Monday, Kim said he aimed at building the 188-member World Bank into a client-oriented agency and providing technical and other assistance to member countries.
Kim on Sunday succeeded Robert Zoellick to lead the global development organization. (IANS) |
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| Airbus to set up assembly line in US |
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| PARIS, July 3: Airbus, a leading European aircraft manufacturer, on Monday announced to set up its first manufacturing facility in the US. The move is part of a plan to bolster competitiveness and strengthen its position in the booming American market, Xinhua quoted the company as saying. Airbus plans to produce about 50 aircraft of the A320 family annually by 2018, with works to start in 2015 and the first deliveries scheduled one year later. The France-based company said the facility in Alabama will “create jobs and strengthen the aerospace industry”. “The US is the largest single-aisle aircraft market in the world, with a projected need for 4,600 aircraft over the next 20 years - and this assembly line brings us closer to our customers,” Airbus president Fabrice Bregier said. Over 11,500 Airbus aircraft have been sold to more than 470 customers worldwide and over 7,200 of these have been delivered since the company first entered the market in the early seventies, the company said in a statement. (IANS) |
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| HDFC Standard Life COO quits |
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| CHENNAI, July 3: Private life insurer HDFC Standard Life Insurance Company Ltd’s executive director and chief operating officer Paresh Parasnis has put down his papers, said company and industry sources on Tuesday. Speaking to IANS, an HDFC Standard Life official said Parasnis has resigned to pursue his long time interests. “He is not joining any competing life insurer,” the official added. Queried about his resignation, Parasnis without confirming or denying the news said: “I do not want to comment now on that.” However, company officials said that Parasnis’s resignation has nothing to do with the Insurance Regulatory and Development Authority’s (IRDA) on Thursday order penalising the life insurer a whopping sum of Rs 1.47 crore. The penalty is for rejecting 21 death claims in violation of the directions of the insurance regulator and also for excess payments made to distributors, including four group companies HDFC, HDFC Bank, HDFC Securities and HDB Financial Service, for services like selling policies, marketing expenses and others. Though the IRDA has been penalising insurers in the recent times for various violations, one official has put it as “IRDA’s penalty mela”, saying the order on HDFC is unique. For the first time, IRDA has explicitly ordered a company to debit the shareholders’ account and not the policy holders’ account so that the cost of regulatory non-compliance is not loaded on the policy holders. The IRDA has also reprimanded HDFC Standard Life for various other violations in its order issued last week. HDFC Standard Life is a joint venture between India’s HDFC Ltd and the UK’s Standard Life. (IANS) |
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| TDSAT gives split verdict on 3G roaming pacts |
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| NEW DELHI, July 3: The Telecom Disputes Settlement and Appellate Tribunal (TDSAT) on Tuesday gave a split verdict in the 3G roaming case in which mobile operators had challenged a government order asking them to stop offering the services beyond their licensed zones through mutual roaming pacts. The two members of the bench, comprising chairman Justice (retd) SB Sinha and member PK Rastogi, had different views on the order, with one favouring the department of telecom that held the roaming pacts illegal while the other supporting the operators who had challenged it. The TDSAT is short of one judge as the technical member has retired. Bharti Airtel, Vodafone and Idea Cellular had entered into roaming agreements to offer 3G services such as video calling, mobile TV and multi-media gaming in areas where they did not have 3G spectrum. The DoT had on last December asked the operators to terminate their 3G roaming agreements calling those illegal. The department also said the government was losing revenue because of the agreements. The operators had then moved the tribunal challenging the DoT order, saying it would harm customers and investment in the sector. The tribunal has said both sides can appeal to a higher court. Tuesday’s judgement, however, would not affect the services being offered by these operators at the moment. Following the orders, shares of Bharti Airtel shot up 3.21 per cent at Rs 319.80 while that of Idea Cellular by 4.57 per cent at Rs 81.25. (IANS) |
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| SBI waives minimum balance for savings accounts |
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| NEW DELHI, July 3: The country’s largest lender, State Bank of India (SBI), on Tuesday announced that it has done away with the minimum balance requirement for savings accounts for both existing and new customers. “SBI waives minimum balance in savings accounts,” the public sector lender said in an advertisement published in leading newspapers. It said that the facility was available to existing customers also. Customers with cheque book facilities were required to maintain a minimum balance of Rs 1,000 in SBI savings bank account, failing to which used to attract quarterly penalty of Rs 225. For the customers who were not using cheque book facilities, the minimum balance requirement was Rs 500. The move would help SBI attract new customers and further consolidate its position in the market. The minimum balance requirement for savings accounts in leading private banks varies between Rs 10,000 and Rs 20,000. However, this requirement is substantially lower in government-run banks. (IANS) |
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| Bank of Baroda bags Reserve Bank Rajbhasha Shield |
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| GUWAHATI, July 3: Bank of Baroda was awarded with three Reserve Bank Rajbhasha Shields for the year 2010-11, for its contribution in progressive of use of Hindi in bank’s works at Rajbhasha Award Function held recently at RBI headquarters in Mumbai. The bank fetched the first prize in Region “A”, 2nd prizes in the Region “B” and “C” respectively. Besides these shields, the bank’s house journal Bobmaitri won the consolation prize in the Bilingual House Journal Competition (2010-11). The bank’s Chairman and Managing Director MD Mallya received these awards from RBI Governor D Subbarao in the presence of Deputy Governors Subir Gokarna and Anand Sinha. Further, Subah Singh Yadav, a staff-member of the bank, was awarded with the third prize in Hindi essay competition organized by RBI. BB Garg, General Manager (O.L. Incharge) and Dr Hariyash Rai, Assistant General Manager (O.L.) were also present on the occasion. The award function was attended by top executives of various public sector banks and Reserve Bank of India. This was stated in a press release. |
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