Sunday, 10 November 2013

VRITTAM (03 NOV 2013 - 09 NOV 2013)


Twitter stock slipped 7.24 percent to close at $41.64 -- a day after a stunning gain of 72.69 percent on its first day of trading on the New York Stock Exchange after a $1.8 billion initial public offering. Some analysts said the debut was helped in part by a shortage of Twitter stock, and that most of the 70 million shares were reserved by the underwriters. 

Twitter's market capitalization, based on its stock price, fell back to around $22.6 billion after topping $24 billion on Thursday.

How's QE tapering a bad thing for Indian markets? Well, it would dry up liquidity, which means FIIs would be pulling out, leaving investors run for cover. However, analysts are of the view that even if the US tapers $85-billion-a-month bond purchase programme, it'll be to the tune of $10-20 billion, something that does not contribute to drying up of liquidity from the market. Amidst chances of QE tapering next year, big domestic event to unfold would be general election results, which may give big sentimental boost to the markets on a favourable outcome.

It is not clear if Zomato will live happily ever after but, right now, this company, which lists restaurants city- and locality wise and counts on restaurant advertisements for its revenues, is in the midst of a fairy tale. In five years' time, its founders, a couple of young graduates from the Indian Institute of Technology, Delhi, have created a company valued at Rs900 crore. It has produced huge value for the entrepreneurs and the fund that backed them and created 600-odd jobs. It is expanding to other geographies at a breakneck speed. And it has created this value on the basis of a service of rising utility to urbanising, ever more prosperous Indians. 

Zomato, which lists restaurants city- and locality wise and counts on restaurant advertisements for revenues, is currently valued at Rs900 cr.

Standard & Poor's today affirmed 'BBB-' long-term and 'A-3' short-term unsolicitedsovereign credit ratings on India, keeping outlook on long-term rating negative.The news came as a grinch on Dalal Street, with the Sensex losing more than 300 points from its intraday high.The markets may have reacted negatively to the news, and some experts may start to raise red flags on India's long-term story, but then there's another take on it.

The S&P’s negative outlook is marginally positive, as the rating agency has almost ruled out a downgrade before the elections

In times of unpredictability, though with a positive standpoint, here's a bad news. The rate of interest that you pay for your home and auto loans is now a tad higher. The State Bank of IndiaBSE -3.40 % (SBI) today raised its base rate by 20 basis points to 10% per annum from the earlier figure of 9.8%.HDFC Bank hiked its base rate by 20 basis points to 10 per cent. This automatically translates into a hike in consumer loans, though earlier banks used to come out with a separate release announcing the rate hike for consumers. Other banks are likely to follow suit. 

India is likely to become the third largest economy by 2030 behind China and the USA, a Standard Chartered report said while projecting that the world is in the midst of an economic "super-cycle". A super-cycle is a period of historically high global growth, lasting a generation or more, driven by opening up of new markets, increasing trade, high rates of investment, urbanisation and technological innovation. India is likely to be the third largest economy with a GDP size of USD 15 trillion by 2030, says Standard Chartered's Super-Cycle Report. China with a GDP of USD 53.8 trillion is projected as the biggest economy, followed by the US at USD 38.5 trillion. 

Benchmark indices have failed to gather momentum at higher levels and have consolidated in a narrow range so far in this week. The 50-share Nifty has slipped below its psychological level of 6,300, whileSensex struggled to hold onto 21,000 levels. According to analysts, markets are consolidating at this point in time and there is a 50-50 chance that the market rally is over.
Most analysts see levels of 6,080 on the Nifty as a make-or-break for the index.


By Saurabh Tripathi 

Unless government musters the will to push through some bold reforms, they could lose value irredeemably.


To know how economic indicators can affect your financial life,click on the slide show below


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