India's gold premium likely to come down to $3

Gold premium in Indian market will amount between $3 and $4 additionally to prices of the precious metal in London, where the world's gold benchmark price declares, Head of India's largest gold refinery said on August 21. 

 

On yearly comparison it is a positive sign as in the last year premiums on Indian gold doubled because of rising demand. In the Financial Year 2014-15, gold's demand moderated over the year bringing down the overall price of the commodity in the market. The credit of weakening gold demand in Indian market is attributing to the import restrictions which are going to continue in the current fiscal.

India faced a widening trade deficit problem which continued over the last few years as the country stood as the biggest importer of gold. High trade deficit posed a serious problem and threatened the economic growth of the country, therefore Indian government along with the central banking authority RBI imposed 10 percent charge on import of gold.

Along with an increase in import duty, another measure to curb down trade deficit is compulsory export of one fifth of accumulated bullion imports in the trade. India imports 70 percent of oil from the middle east which tops the list of importers before gold which is useful as the world's currency.

Such strict actions on inflated the price of gold is making the commodity an unattractive investment as the premiums climbed to $ 160 per ounce. Premium refers to the difference in global benchmarked price of a commodity or stock under the local prices of the commodity in the country. Premiums are representative of demand and supply of a country's market.

Managing Director of the top Indian refiner, Rajesh Khosla said, "A decline in demand is citing a fall in premiums in the yellow metal price to average from $3 to $4 per ounce over the world's benchmark price, which is more than 50 percent reduction in price from last year's premium, which stood between $7 and $10."

Khosla supported the restriction and quoted, "Quantity of gold imports restrictions is going to stay." He explained that India is a country where demand for gold is never-ending and therefore, it is essential to control it. The reason behind importance of restriction in India is the country's insufficiency to provide funds for allowing unlimited free import of gold.

Alliance of India's MMTC Ltd and Swiss refiner PAMP gave birth to MMTC-PAMP, a gold refinery company which closed down its functioning in August 2013 after the Indian government and RBI launched policy of controlling gold imports.

Looking at the concern of refineries in India, the government alloted special licenses to these companies to buy in 15 percent of licensed quantity subscribed to them, i.e. 150 Kilograms.

The World Gold Council said, "Continuation of import restrictions means that gold demand in India will amount to 850-950 tonnes in FY 14-15, bringing down previous year's record of 974.8 tonnes."

 

Micromax & Uninor great investment deals with 4G operators

Telecommunication sector expanded at 11 percent in financial year with budgeted service provider like Micromax and Uninor recording highest sales record.

Telecom majors recorded high growth variants from 2005 to 2010 but failed out on performance in the last fiscal due to unfavorable economy, rupee depreciation and unstable government. The changes in the market scenario with a growth oriented monetary policy revived telecoms.

Indian telecom sector is back on the track showing robust growth in the market. Telecom industries are growing fast and will continue to grow following their previous trend which blocked due to economic slowdown in the country, with reference to disclosures in Voice&Data annual survey.

The sector published cumulative growth of 10.8 percent in the previous 4 months of FY 2014. In comparative analysis, total revenue registered by Indian telecom sector consolidated to Rs. 4,29,087 crore adding Rs. 41,789 crore to last year's net profit of Rs. 3,87,298 crore. 

In overview we can see that profits are climbing at a much higher percent as compared to other sectors. Telecom industries are having a wide arena of growth with coming in of 4G data connection and expansion of data connections in India exploring areas geographically.

Telecom giants in the Indian markets: Idea, Airtel and Vodafone together earned more than 50 percent of consolidated net profits in the sector.

Considering the wider picture of the sector, Uninor came out as the star player in the industry as it gained more than 21 percent in year-on-year analysis of revenue. Telenor group's Indian venture proved profitable not only in revenues but expansion as it excelled at joining in most customers racing over larger competitors like Tata Docomo and Reliance in the current fiscal year.

Looking at Uninor's expansion backed up with effective sales and expansion plans for the future, investors in the stocks of the company are recording profits at higher share price and growing dividends. 

In the equipment manufacturers, Samsung came in the top list with best phones followed by Nokia which is growing backed up by Windows and Indus towers. Above mentioned top suppliers recorded 30 percent of total earning in the FY 2014 cumulatively. 

Micromax made a special mark among telecoms as it reported 115 percent growth in earning in the first four months of FY 2014. The company is growing tremendously in trades and will continue to do so, analyst said. Shares of Micromax are looking positive as it has captured most of the markets with its affordable and trendy phones.

As the company records, higher growth in revenues it benefits its shareholders as demand is rising pushing up the stock price of Micromax. Investors in the stock of the company are hoping to gain high dividends from the phenomenal growth chart.

Experts are looking into more acceleration in growth market of telecoms in the later half of the year. As Reliance Jio Infocomm is launching 4G services in the Indian market after winning the license in the beginning of the year. Heavy investments of telecom operators in providing 4G arena to their customer are surely to pay off in higher profits in the later half of the financial year.

 

 

Rupee at 60's level; Copper & Nickel climbed Rs 2/kg

INR regained values standing stable at 60 points against 1 US dollar. Indian stock markets spread an optimistic wave across the world especially affecting domestic equity, commodity and forex traders. Global markets surged on positive cues from Iraq which started balancing the price of Crude oil in the world showcasing a relaxed environment recovering from geopolitical conflict.

Forex investors looked optimistically at the opening rate of INR/USD as the market opened after four days of break from Friday to Monday. At 1430 hours, regained its position at 60.675 rising 0.16 percent from its last closing at 60.77.

The currency opened at the same level it closed down without gaining or losing any points in the trade. Further, as the day commenced and markets struck sky-high crossing their life time gains, Rupee gained the position at 60.6575.

INR valuating at 60.6575 against one US dollar is the highest point reached in August by the currency till date. The currency reported reviving falling crude oil prices which play a very important role in the imports of the country.

Market Analyst said, "As global crude oil prices fell down in the last four days when rupee did not trade, it is obvious that rupee is gaining on the benefits now."

In the trading market today, Brent crude with delivery tag of October priced $ 101 per barrel falling down by $ 12 per barrel as the geopolitical situation improved since June to August in the western part of Asia. In the first 7 months of 2014, rupee grew 1.86 percent in the exchange values. 

Dollar Index,  measurement of US currency among the major currencies of the world, traded 0.1 percent higher at 81.659, with reference to its last record at 81.576. The 10-year bond values climbed from 8.52 percent to 8.53 percent after opening at 8.51 percent.

Base metals traded on multi commodity exchange of India (MCX) priced higher in the trade on Tuesday. Copper and Nickel led the gain as their prices hiked at Rs 2 per kg. Commodity traders bought in non-ferrous metals looking at the strengthening global markets and the need for the metals. 

Investors and traders quoted, "Copper traded at its weekly high in the global market which cued us to buy in more of the commodity to retain profits." The confidence level amongst foreign and domestic traders build up with overall positive outlook of the Indian economy and recovering global trends.

Copper dated delivery after three months rose 0.30 percent in terms of USD amounting to $ 6,926.75 per metric tonne according to the script in London Metal Exchange.

In Delhi, copper mixed scrap traded at Rs 430 and nickel (4x4) traded between Rs 1,092 and Rs 1,098 per kg.

NIFTY & SENSEX LIFE TIME HIGH AT 7,874.85 & 26,430.98

Key benchmark indices of Indian markets, i.e. Nifty of the biggest bourse in India and Sensex the oldest representative gauge made a new mark rising its bar to the highest record in all time on Monday. 

Nifty opened red in the morning at 7,785.25 falling 6.55 points as it closed at 7,791.70 on Thursday closing for the weekend. Sensex on the other hand gleamed in green as it gained 20.46 points opening at 26,123.69. Both the indices fell in the first hour of trade, coming to their intra-day lows, sensex at 26,080.15 points and nifty at 7,782.70 points.

After taking the dip of the day, indices used the pressure reversing the trend as banking stocks jumped raising sensex and nifty in the next 7 minutes on the clock. Blue chips like Axis bank, ICICI bank led gains on statement of the Prime Minister of India, Narendra Modi.

The new government intends to provide banking facilities to all the areas especially rural areas where there is are various opportunities to explore as most of Indian population resides in villages. With governments support and positive wholesale price inflation data large scaled firms, especially banks surged in the market. 

Nifty broke its previous record set in July 2014 at 7,840.95 as the script of the benchmark flashed 7,860.85 points. Sensex topped its previous highest point with 200 points setting the new benchmark at 26,342.98 points.

WPI of India dropped to its lowest point since March 2014 covering up the losses of rising retail inflation to 7.96 percent, the highest mark since May, which hurt the market sentiment.

Market researcher explained, "market is standing positive and the credit goes out to foreign investors, lowered crude oil prices and the rise in INR."

Prices of Brent crude plunged down lower than $103 a barrel as output from Libya escalated with optimistic cues from the world supplier Iraq.

Investments from overseas investors flowed in Indian markets from Thursday onwards looking at the robust markets represented by the benchmark indices. Foreign portfolio investors (FPIs) purchased stocks of blue chipped companies in India worth Rs 625 crore on Thursday. Currency trading and secured Indian bond trades are on a break today for the second world working day due Indian festival of Janmashtami.

Indian Rupee opened at 61.10 for exchange of 1 USD, with further advancements in the, INR edged higher to 60.77 per dollar. However, FOREX trades remained closed in India for celebrating Janmashtami.

Though, most market researchers looked at the growth trend with a smiling face, one of the market researcher said, "The rising of stock markets is glorious but some cautions are neccessary as mid-caps and small-caps are not soaring at an equal proportion." 

The biggest gainers include stocks of Infosys and HUL, tagged as defensive stocks in the Indian markets.

Nifty gainers starred, BPCL climbed more than 6 per cent while Tata Motors, Axis Bank, and IDFC rose over 3 percent. IT shares availed some profits in the trade today. TCS, Infosys and HCL Tech lost 0.6 per cent to 1 per cent.

 

Markets surged as FPI bought Rs. 718 crore shares

India's key benchmark indices expanded gains hitting new intra-day highs at 1500 hours IST (GMT +0530) in the trades today.

India's oldest stock exchange's benchmark, S&P BSE Sensex index and the most representative 50-unit CNX Nifty index of India's largest stock exchange crossed the highest record set fortnightly.

Sensex traded over 26,000 mark after a long as the index crossed the level in the early morning trade and continued above it for the rest of the day. The index surged 0.71 percent gaining 181.33 points jumping to 26,103.23 at the end of Thursday.

Market sentiment stood positive which boosted the feelings of foreign financial investors much more than their Indian counterparts. Most of the buyers in the stock markets today were foreign portfolio investors (FPIs).

The trading volume of market stayed up strengthening the market breath in the day except when it tipped off after hitting 26,036 and then fell back to 26,001 at 0930 hours IST.

Stocks of Mining sector and Metals climbed as analyst predicted that Government of China will support its economy through other ways to keep up to its preset target of 7.5 percent annual growth since Wednesday's report on contraction in credit line pulled down the Chinese markets.

World's largest Aluminum rolling company, Hindalco Industries dropped 1.86 percent in the market as the company posted lower profits in the first quarter result.

In the Aluminum trading, Tata Steel, led the growth in the market with inflated first quarter results posted yesterday. The national aluminum leader scripted initial fall but balanced it out as share price rose at 1.35 percent on Thursday.

Trading in Oil and Natural Gas, i.e. MCX Energy commodities surged as the demand for stock of ONGC climbed reversing the loss incurred in the past few days.

Top companies which gained on Nifty and Sensex included GAIL India Limited expanding at 3.13 percent, Sesa Sterlite gained 2.82 percent, Tata Motors added 2.40 percent, Larsen and Turbo (L&T) soared 2.10 percent, ICICI and HDFC bank stocks made the top list of indices.

Hero MotoCorp Ltd, Hindalco Industries Limited, Housing Development Financial Corporation, Bharti Airtel Ltd, and Bajaj Auto Ltd lost 2 percent in the trades on Thursday.