Sensex falls 100 points, Nifty below 8,600 ahead of Economic Survey

within the broader market, BSE Midcap and BSE Smallcap indices were little changed

The benchmark indices on Tuesday extended losses for the second straight day ahead of business Survey 2017-18 to be unveiled later today, while globally the biggest drop up to now in 2017 on Wall side road dampened the investor sentiment across Asian markets.

At 09:17 am, the S&P BSE Sensex used to be trading at 27,713, down 136 points, whereas the broader Nifty50 used to be ruling at eight,587, down 46 points.

in the broader market, BSE Midcap and BSE Smallcap indices slipped 0.2% each and every.

“Going ahead, Nifty may face a revenue-reserving at eight,seven-hundred mark. Momentum could calm down in opposition to 8,seven-hundred and Nifty may just contact the make stronger ranges of 8600-8570 on downside. For intraday, the reinforce lies at eight,520-8,470 and resistance positioned at eight,640-eight,670,” said brokerage Nirmal Bang in a technical be aware.

in the meantime, foreign portfolio investors (FPIs) bought equities to the tune of Rs 607.36 crore on Monday, as per provisional data. home institutional traders have been also internet buyers and bought shares value Rs 40 crore.

Buzzing shares

ONGC was the top Sensex gainer to spike over 5% to Rs 212 on reviews that the corporate has bought the primary installment of $19 million from Venezuela's state oil firm Petroleos de Venezuela in opposition to convalescing pending dividend, said Reuters quoting a senior company legitimate.

idea cell extended gains to rise over 7% to Rs 106 as investors believe the merger with Vodafone India will give a boost to company's finanaces. The inventory had added over 29% in intraday exchange on Monday.

among losers, Tata Motors shed nearly 2% to Rs 523 on reports that the Jaguar Land Rover (JLR) has shelved its plan to manufacture a small SUV (activity utility car) in India.

funds session starts

Finance Minister Arun Jaitley is all set to desk economic Survey 2017-18 as funds session of the Parliament begins later these days. Market will take cues from the industrial knowledge such as GDP growth estimates, fiscal deficit numbers and tax figures and so forth on hand within the economic Survey.

BoJ continues established order

The financial institution of Japan maintained to its ultra-simple financial coverage and held again from raising its inflation forecast for the approaching 12 months, signalling its anxiousness in regards to the uncertain path of US President Donald Trump’s coverage.

In a widely anticipated move, the BoJ maintained the 0.1% pastime it prices on a component to the surplus money that monetary institutions park with the primary financial institution.

Wall boulevard falls most so far this year

major US market indices posted their biggest drop up to now in 2017 as investors involved that a curb on immigration ordered by way of Donald Trump used to be a reminder that some of the Trump’s insurance policies should not market-friendly.

The Dow Jones Industrial reasonable fell 122.65 factors, or zero.61%, to shut at 19,971.thirteen, the S&P 500 misplaced 13.seventy nine points, or 0.60%, to 2,280.9 and the Nasdaq Composite dropped 47.07 points, or zero.eighty three%, to five,613.71.

Asian markets were also on the protecting. MSCI's broadest index of Asia-Pacific shares outdoor Japan fell zero.3% while Japan's Nikkei dropped 1.1%.

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Sensex Edges decrease On warning ahead Of funds

Indian shares edged lower on Monday after four straight periods of gains on warning ahead of the federal finances, while broader sentiment was additionally hit by way of fears about the affect of U.S. President Donald Trump's immigration curbs.

executive is because of existing its 2017/18 budget on Wednesday, with shares remaining week posting their largest weekly good points in eight months on hopes the federal government will announce incentives to ease the affect from a bold and unsafe gamble to outlaw high-price previous forex bills.

however additional warning set in on Monday, especially as Asian shares fell on concerns that Trump's ban on the entry of refugees into the U.S. would show destabilising for the remainder of the sector.

"Markets are somewhat wary of what lies in the price range and have most certainly have rallied too a long way on the belief that some good is in the offing," said Saurabh Jain, assistant vice-president of analysis at SMC global Securities.

The broader NSE Nifty was down 0.14 p.c at 8,629.05 with the aid of 0546 GMT, while the benchmark BSE Sensex was once 0.06 p.c decrease at 27,866.14.

each indexes had risen greater than three % closing week in their biggest weekly good points when you consider that late may.

IT shares contributed to a majority of the losses on the NSE index. The Nifty IT index fell 1.15 percent, dragged down with the aid of Infosys Ltd and Tata Consultancy products and services Ltd, which misplaced over 1.40 p.c each and every.

investors additionally booked profits in latest outperformers: the Nifty financial institution index, which led gains ultimate week, fell zero.40 %, dragged down through HDFC bank Ltd and Kotak Mahindra bank Ltd. The index had received 4.seventy two % closing week.

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ITC Q3 net profit rises 5.7% to Rs 2,646 crore, blames demonetisation for bleak performance

ITCBSE -2.78 % Ltd pronounced 5.7% jump in web profit at Rs 2,646.seventy three crore for the third quarter ending December 31, 2016, while complete income from operations grew with the aid of 4.7% at Rs 13,569.ninety seven crore. The conglomerate attributed the bleak efficiency to persisted power on the cigarette trade and the demonetisation power, which impacted sales of biscuits, snacks, noodles, private care products and attire.

the corporate's board approved the appointment of Sanjiv Puri as the following chief govt officer of the company taking full charge of the operations from February 5, 2017, and present chairman and CEO YC Deveshwar will develop into non-govt director and chairman, mentoring Puri thereafter.

The board has additionally sought to enlarge the company's memorandum of association to foray into the healthcare industry, about which the company refused to share additional details.

The Kolkata-based totally agency, in its cash unlock, said the operating setting used to be extremely challenging all through the quarter. FMCG sales had been adversely impacted as a result of lower shopper offtake and reduction in alternate pipelines, it stated.

the company stated that to mitigate the impact of demonetisation, it had implemented a couple of initiatives, akin to increasing the provider frequency of grocery retailers, improving presence in modern exchange shops, and increasing brief credit score.

"These initiatives, coupled with a progressive easing of the liquidity state of affairs, led to vast restoration of gross sales momentum in opposition to the tip of the quarter," the corporate said.

The ITC inventory suffered on the bourses declining through 2.78% to shut at Rs 257.5 on the Bombay inventory change on Friday. the company's flagship cigarette industry reported a earnings increase of two.2% at Rs eight,287.ninety seven, which analysts attributed to a cost hike all through the quarter on make a selection brands.

trade profitability used to be up via 1.6% at Rs 3,033.69 crore. The cigarette trade was once subdued as a result of tight liquidity conditions prevailing available in the market and persevered regulatory and taxation pressures, it said. The non-cigarette FMCG industry was once also hit onerous right through the last quarter, with sales growing by means of three.four% at Rs 2,569.26 crore, while the section additionally said a lack of Rs 19.66 crore as compared to a profit in the same duration ultimate yr.

ITC attributed the losses to a disruption in gross sales, sharp raise in costs of uncooked subject material, corresponding to wheat, maida, sugar and cashew, an early 'finish of season sales' and heavy discounting in the lifestyle retailing business, apart from the gestation price of new merchandise. The usa's 2d largest hotel chain stated 7.three% soar in hospitality industry earnings at Rs 370.fifty one crore throughout the quarter, on the back of upper average room price and growth in meals and beverage income.

ITC's paperboards, paper and packaging phase continued to be impacted by using slow demand stipulations prevailing within the FMCG and cigarette industries, and low cost imports from China, which kept the income increase flat.

The agri industry, however, suggested 12.9% growth in earnings at `1,671.92 crore pushed by using buying and selling opportunities within the home wheat market and external sales of leaf tobacco, which managed to offset the decrease interior demand.

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Rupee opens 11 paise down at 68.18 against dollar

The rupee opened eleven paise down at 68.18 against buck due to buying of yankee foreign money by means of banks and importers.

meanwhile, the home equity market opened marginally within the green following blended international cues. The BSE Sensex opened fifty two.89 factors, or 0.19 per cent, up at 27,761, whereas NSE Nifty opened 7.seventy five factors, or 0.09 per cent, up at eight,610.50. The native forex used to be trading 14 paise down at 68.21 in opposition to dollar round 9.15 am (IST).

The rupee on Wednesday settled 8 paise higher at 68.07 in opposition to dollar.  the rupee ended on a slightly better word on Wednesday on the back of energy in major currencies in opposition to the united states buck and receding dangers of outflow redemptions. strength in home equities and a delicate US$ supported the rupee to increase good points.

international institutional buyers (FIIs) sold shares price Rs a hundred and ten.50 crore on Wednesday with gross gross purchases and sales of Rs 5153.ninety eight crore and Rs 5043.forty eight crore, respectively, in step with knowledge to be had with depository NSDL.

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Bright prospects for gold in India despite note ban

even if demonetisation has dented gold demand, the long-term prospects of the yellow metallic in India are brilliant, in accordance the arena Gold Council (WGC). via year 2020, gold consumption in the us of a is prone to touch 850-950 tonnes, WGC says. whereas the main demand will be for jewelry, bar and coin investment is predicted to be 250-300 tonnes by using then. jewelry exports are estimated to touch the $forty-billion mark, from $8.6 billion now.

“Gold change will turn into extra transparent with the introduction of products and products and services tax (GST), mandatory hallmarking and a tremendous push by way of organised jewellers to advertise non-money funds,” stated Somasundaram P R, head of WGC’s India operations, after unveiling the file titled India’s Gold Market -- Evolution and Innovation.

in step with WGC, the general gold demand will reasonable at 650-750 tonnes in 2016. India’s gold demand stood at 441.2 tonnes in January-September of 2016.

Somasundaram says that gold smuggling is anticipated to be higher in 2016 because of one per cent manufacturing excise tax. As much as 119 tonnes are estimated to have been imported through unofficial channels in 2015. Confirming golden days ahead for the dear steel, joy Alukkas workforce chairman pleasure Alukkas instructed express that the worst period after demonetisation is over and demand will undoubtedly decide up.

“there's no substitute for gold as of now. So, individuals will begin accumulating the yellow steel in the future. The signs of revival are already seen now,” brought.

On India’s gold imports, WGC said that within the brief term, the removing of some import restrictions can have two main advantages. First, nominated businesses will be higher able to source bullion to meet the it appears unending urge for food for gold in India. 2nd, this elevated drift will probably make the setting much less sexy for unofficial gold imports.

“The silver lining about demonetisation within the gold sector used to be that cashless transactions have increased bringing in more transparency. South Indian demand will stay intact going ahead as smartly,” mentioned B Girirajan, managing director, Bhima workforce.

even supposing demonetisation has dented gold demand, the long-term potentialities of the yellow metallic in India are brilliant, consistent with the sector Gold Council (WGC). via the 12 months 2020, gold consumption within the usa is prone to contact 850-950 tonnes, WGC says. while the principle demand will probably be for jewellery, bar and coin investment is expected to be 250-300 tonnes by using then. jewellery exports are estimated to the touch the $40-billion mark, from $eight.6 billion now.

“Gold exchange will grow to be extra transparent with the introduction of goods and products and services tax (GST), mandatory hallmarking and a tremendous push by organised jewellers to promote non-cash payments,” stated Somasundaram P R, head of WGC’s India operations, after unveiling the file titled India’s Gold Market -- Evolution and Innovation.

according to WGC, the overall gold demand will average at 650-750 tonnes in 2016. India’s gold demand stood at 441.2 tonnes in January-September of 2016.

Somasundaram says that gold smuggling is predicted to be greater in 2016 because of one per cent manufacturing excise tax. As much as 119 tonnes are estimated to had been imported thru unofficial channels in 2015. Confirming golden days in advance for the valuable metallic, joy Alukkas workforce chairman joy Alukkas told categorical that the worst period after demonetisation is over and demand will unquestionably choose up.

“there is not any replace for gold as of now. So, people will start accumulating the yellow steel in the future. The indicators of revival are already seen now,” brought.

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Is Budget 2017 the most difficult one till date?

most likely no Indian finance minister in history would have ever offered a finances with so many world and native uncertainties, coupled with such sparse domestic economic data, as Arun Jaitley. he's going to be presenting this Union finances on February 1, barely three months after demonetisation—the largest Black Swan adventure in contemporary nationwide reminiscence— whose impact is still unknown.
The us of a’s chief statistician has already revealed that the economy is slowing down; the prognosis based on numbers best except October and with out factoring in results of demonetisation. Union budgets frequently have visibility of economic performance, including company stability sheets, at least until the top of December, and a tentative idea of how the remaining quarter of the fiscal 12 months is shaping up.
The evolved date of this 12 months’s finances robs the finance minister of these insights. to add to the confusion, the Railway finances, which used to be presented separately for the earlier 92 years, is being folded into the fiscal plan.
“This (2017-18) finances could be introduced in most unsure times and is unpredictable,” NR Bhanumurthy, professor at national Institute of Public Finance and policy (NIPFP), advised ET.
In 1991, a steadiness of fee problem had made the finance minister’s job a difficult one. however the uncertainty at the time was once concerning the future and the federal government then had a transparent idea of its steadiness sheet. In 2008 and 2009 world headwinds buffeting the Indian economic system had created uncertainty. yet, Pranab Mukherjee, the then finance minister had sufficient headroom to provide a stimulus even supposing it derailed fiscal ambitions. And there was no dearth of home data.
however Jaitley may have none of these luxuries.
Oil No remedy Zone
since the Narendra Modi executive took place of job, it has had the comforting cushion of depressed international commodity costs, particularly oil. however these are actually off their lows, moving up incessantly. Oil prices dropped to a 12-year low of $28 for a barrel remaining year. they've in view that firmed
up and Brent Crude was once buying and selling beneath $55 a barrel on January 23 on the Intercontinental trade.
Correspondingly, the Indian crude oil basket has risen from $39.88 in April 2016 to $54.24 in the first week of January, according to the oil ministry’s petroleum planning and analysis cell.
“we predict international oil prices to upward thrust to near $60 in 2017 and about $sixty five in 2018,” an energy analyst with a overseas broking agency instructed ET on condition of anonymity.

India imports greater than 70% of its oil, and high global costs are the one largest issue after monsoon rains that influence the financial system. The unstable nature of both rains and oil prices are sufficient to present sleepless nights to finance ministers and may ruin essentially the most meticulously deliberate budgets.

every time the group of the Petroleum Exporting countries (Opec) consents to chop production to push up prices, the finance minister again in India loses slightly of headroom. When, within the 2nd week of January, Jaitley jubilantly announced buoyant tax figures for the primary three quarters, the most important spike he mentioned used to be forty three% in excise responsibility collections to Rs 2.seventy nine lakh crore. About Rs 1.37 lakh crore of that may have come simply from responsibilities on petrol and diesel retail sales; customers pay Rs 21.48 per litre of petrol and Rs 17.33 for diesel in excise responsibilities.
PPAC information displays the field as a complete contributed 80% of Rs 1.fifty two lakh crore excise duties collected in the fiscal’s first 1/2. Retail costs of fuels are already near ancient highs hit all the way through the UPA regime.

Jaitley said that as on December 31, direct taxes had been up 12% and indirect taxes 25% over the previous yr. however that may be the end of excellent information, because the crucial records place of business (CSO) had suggested that GDP growth would slow down to 7.1% in fiscal 2017 from 7.6% the earlier year. The CSO estimates used data up to finish of October closing yr and didn't keep in mind the
demonetisation of Rs 500 and Rs 1,000 notes, which made up 86% of forex value in circulation.
Demonetisation Pangs
No dependable information is available to estimate the true price of the PM’s determination, whose goal was variously described as rooting out pretend currency, preventing black cash or pushing digital transactions. In what can also be thought to be early affect signals, vehicle gross sales dropped 19% in December, the most for that month in sixteen years.
Two-wheeler sales, which might be a very powerful pointer to rural demand, contracted 22% — the sharpest contraction on the grounds that Society of Indian vehicle manufacturers began recording information two decades ago. “The ultimate quarter of fiscal 2017 shall be susceptible,’’ said Ajit Dange, head of portfolio management products and services, domestic trade, at SBI Mutual Fund.

Dange expects an economic revival from the middle of 2017. private data compiler, Centre for Monitoring Indian financial system (CMIE), has estimated transaction value of demonetisation at Rs 1.28 lakh crore for the 50 day up to December 30. It estimated that 48% of the body of workers had misplaced incomes all through the period, affecting consumption and savings.
“This affect of misplaced wages, broken supply chains and lost companies will be lasting,” said CMIE in a be aware of January 12. Bhanumurthy of NIPFP listed out uncertain growth goals and ambiguity with reference to fiscal and financial relationship among the many current macro-financial uncertainties. as a substitute of a particular target, the government will have to goal for a earnings deficit range.
financial policy having a flexible inflation target and monetary coverage having fixed deficit objectives — as it's now — creates inconsistency, he said.
Tax Shift
the most important comfort for the finance minister has been buoyancy in tax collections. incredibly, 2016-17 will probably be a year when financial boom would fall method wanting estimates in the beginning
of the yr but federal govt revenues will overshoot targets due to a relentless pursuit of evaders and amnesty schemes.
A voluntary earnings disclosure scheme yielded about Rs 30,000 crore in taxes and searches had unearthed every other Rs fifty six,000 crore of unaccounted income, the finance minister had printed in October. The chase is expected to continue the following yr as smartly. the government is hoping to herald a uniform goods and service tax (GST) from July, introducing extra effectivity and compliance in tax collection.
SBI Mutul Fund’s Dange anticipates job losses as the shift to GST will shut down plenty of small industries within the informal sector that employs over ninety% of India’s personnel.
“lots of them (small industries) will be unable to avert taxes and will turn into uncompetitive. Tax evasion was the one source of profitability for a lot of of them,” he stated.
more revenues will supply the Modi executive leeway to spend more. Most economists ET spoke to agree that public spending on infrastructure is really vital to maintain business buoyant over the subsequent several quarters. Disruption as a result of GST could be close on the heels of the shake-up as a result of demonetisation.

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supply answers on note ban in writing, an unhappy p.c.tells Urjit Patel

The governor didn't supply specific solutions on who initiated the notice ban

unsatisfied with the responses of Reserve bank of India (RBI) Governor Urjit Patel to particular queries on demonetisation, the public money owed Committee (PAC) of Parliament on Friday asked him to furnish written replies to the concerns expressed via the participants inside two weeks and seem ahead of the panel again.

Patel, together with Deputy Governor R Gandhi and other senior functionaries, appeared ahead of PAC for oral proof on “assessment of financial coverage”. The governor didn't supply explicit solutions on who initiated the notice ban, how a lot cash had come again into the banks and when the money provide scenario would normalise, sources stated.

all the way through the four-hour-long meeting, Opposition contributors asked Patel questions on the dent within the economy, job losses and the lack of over 100 lives allegedly because of demonetisation. “He (Patel) said there is also issues however we will overcome them,” said a member on the panel.

The RBI governor mentioned the important financial institution was once in touch with the carrier providers of some online fee structures to cut back transaction price. When a member mentioned that the deposits in cooperative banks shot up round six times within days of the notice ban, Patel, mentioned the RBI was having a look into the matter.

To have additional readability on the affect of the note ban, PAC has additionally requested Finance Secretary Ashok Lavasa, financial Affairs Secretary Shaktikanta Das, earnings Secretary Hasmukh Adhia and financial services and products Secretary Anjuly Chib Duggal to seem sooner than it on February 20.

additionally, more than seventy two days after demonetisation, RBI, in a written resolution to queries raised past, mentioned it nonetheless did not comprehend the exact number of junked foreign money notes that have been in circulation and it's nonetheless reconciling the choice of notes that were deposited again.

The important bank said: “the precise choice of distinctive bank notes withdrawn from circulation is being worked out.”

past this week, Patel had informed the Parliamentary Standing Committee on Finance that new currency notes to the tune of Rs 9.2 lakh crore had been presented into the system after the elimination of the previous notes.

When a member wished amenities for NRIs to deposit their old notes at embassies, citing a percent with Nepal, Patel said he would appear into it.

PAC used to be knowledgeable by using RBI that the subject associated to demonetisation was once underneath discussion between the government and RBI for “some months”, following which the concept was placed before the crucial board of RBI on November eight for consideration. The board beneficial the notion to the federal government.

The Board assembly was once attended by using Governor Patel, two Deputy Governors (Gandhi and S S Mundra), and five directors — Nachiket Mor, Bharat N Doshi, Sudhir Mankad, Shaktikanta Das and Anjuly Chib Duggal.

Sources mentioned Director N S Vishwanathan (deputy governor) did not attend the meeting as he stayed back in Mumbai for “strategic reasons” to transient the bankers first hand instantly after the choice on demonetisation used to be taken.

every other director, Natarajan Chandrasekaran, was once out of the country on the time of the assembly.

Defending the cash withdrawal limits imposed after the notice ban on November eight, the RBI governor stated, “The ceiling on withdrawal was decided on the foundation of availability, past utilisation pattern and taking into account the wishes of the popular people so that hardships are minimum.” the government has increased the money withdrawal restrict from ATMs to Rs 10,000 per day but has no longer changed the cap of Rs 24,000 from banks per week. In between, it has

changed the bounds a number of times, as well as relaxations given on funds via scrapped currency notes.

In his written reply, Patel brought up that, in the past, individuals were withdrawing Rs 12,000 or Rs thirteen,000 per week, and Rs 50,000 per month, on a typical. “He (Patel) stated the advantages of the notice ban will come within the medium and lengthy terms,” mentioned every other PAC member. As Opposition individuals lobbed queries at Patel, the Bharatiya Janata birthday party (BJP) participants praised him for demonetisation and maintaining secrecy within the topic. This provoked an Opposition member to jokingly observation that the home should move a vote of thanks for the RBI chief.

As soon as the assembly started, k V Thomas, chairman of PAC and a Congress MP, made a commentary on demonetisation, prompting protests from BJP members, including Bhupender Yadav, Kirit Somaiya and Nishikant Dubey.

Citing the amendment within the RBI Act in 2016, they said any question put to Patel must be in context of the central bank’s financial coverage and now not outside it.

After an extended debate, the panel agreed that questions about demonetisation might be asked but simplest in the context of monetary coverage. it is learnt that Patel mentioned the cash drift position had mostly superior in the united states. To questions about the affect of demonetisation on growth, Patel mentioned there may well be affect in the quick run, however in the mid and long terms the transfer was once a good idea for the financial system.

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Sensex Fall Over a hundred points, Axis financial institution Slumps On susceptible Q3

Axis bank pronounced seventy three per cent decline in its web profit at Rs 580 crore in comparison with Rs 2,a hundred seventy five crore year in the past, as unhealthy loans jumped.

9.fifty five a.m.: Brokerages have reduce their income estimates for Axis bank post its vulnerable Q3 earnings. Macquarie has reduced its revenue estimates by 30-forty per cent, CLSA by means of 14-18 per cent, credit score Suisse with the aid of 7 per cent and usaby 8-7 per cent.

9.45 a.m.: investors endured to sell Axis bank shares on asset high quality difficulty. Axis bank's gross non-performing assets (GNPA) as a percentage of whole advances rose to 5.22 per cent compared to 4.17 per cent in the September quarter. meanwhile, it can be web non-performing assets, which is GNPA minus provisions, rose sixteen basis factors sequentially to 2.18 per cent of advances. Axis bank shares have been down 5.86 per cent at Rs 455.45.

9.20 am.: The BSE Sensex fell over a hundred factors led via losses in banking and IT inventory, while the Nifty50 index breached the eight,400 mark. Sensex made a low of 27,196.2 and the Nifty fell as much as 38 points to 8,397.05.

Losses in banking shares have been led through Axis bank, which plunged over 6 per cent to Rs 452.sixty five on vulnerable income for the October-December quarter. the private sector lender mentioned seventy three per cent decline in its net profit at Rs 580 crore in comparison with Rs 2,one hundred seventy five crore yr ago, as bad loans jumped leading to over four hundred per cent annual leap in its provisions to Rs 3,796 crore. ICICI bank and bank of Baroda were the opposite banking losers within the Nifty50 index.

instead of banks, IT stocks also witnessed promoting. HCL, Infosys, Tech Mahindra fell between 0.5-0.9 per cent each.

in the meantime, Asian shares fell on Friday as caution prevailed in financial markets beforehand of US President-opt for Donald Trump's inauguration, even as China's fourth-quarter economic boom beat expectations and Federal Reserve Chair Janet Yellen took a less hawkish coverage stance.

9.00 am.: Rupee opens better at sixty eight.05 per greenback against Thursday's close of sixty eight.12

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RBI replaces 60% of banned foreign money: Rs 9.2 lakh cr remonetised until date

Parliamentary panel individuals say governor used to be silent on the quantity that has come back

The Reserve financial institution of India (RBI) has infused around 60 per cent of the entire banned currency notes after demonetisation.

The RBI Governor Urjit Patel informed a parliamentary standing committee on finance on Wednesday that the primary financial institution had infused new forex notes worth round Rs 9.2 lakh crore into the device. forex notes estimated around Rs 15.four lakh crore were withdrawn when the Centre introduced demonetisation on November eight, 2016. Most members within the finance committee, including former prime Minister Manmohan Singh and panel chairman M Veerappa Moily, spoke in favour of defending the autonomy of the RBI as an institution however stated that accountability from its governor should be sought because the be aware ban had impacted a big of choice of folks.

although the members found Patel’s clarification lucid, they had been miffed that he did not answer queries like how much cash had been deposited in banks after demonetisation or through when the cash provide scenario would ease throughout the united states of america. “Patel got here throughout as a professional in his temporary… but we had quite a lot of concerns to raise,” said an Opposition member.

The finance committee assembly was once significant as key finance ministry officials, together with economic Affairs Secretary Shaktikanta Das, earnings Secretary Hasmukh Adhia briefed the panel.

Author : Wealth Research

Parliament panel to grill RBI governor Urjit Patel over notice ban as of late

Standing committee on finance to additionally focus on RBI autonomy and citizen's rights

Reserve bank of India (RBI) Governor Urjit Patel (pictured) will face questions on demonetisation and its aftermath when he appears earlier than the Parliament’s standing committee on finance on Wednesday.

Opposition birthday celebration contributors on the panel, mentioned sources, were not satisfied with the paperwork RBI and the finance ministry had given the committee, in beef up of high Minister Narendra Modi’s November 8 announcement banning Rs 500 and Rs 1,000 currency notes.

a big concern of those participants used to be whether RBI’s autonomy used to be compromised by using the observe ban decision. every other issue could be if the decision violated citizens’ rights over their felony cash in banks, assured by using RBI, with withdrawal limits. additional, the individuals would like to know if the cashless economy agenda being pushed by way of the Centre was once feasible as a couple of major economies equivalent to the usa, Japan, the uk and Singapore have still no longer long past completely cashless.

contributors would also ask questions on whether the banking gadget was geared up to enforce the word ban. the fact that at the least one hundred individuals reportedly misplaced their lives in the aftermath of the note ban and if their family got compensation would also be thrown at the RBI chief, sources mentioned. “The notice ban has messed up the economy. all the issues of the public could be raised on the meeting,” a lawmaker informed this newspaper, on condition of anonymity.

the federal government had steered the relevant bank on November 7, 2016, to believe the observe ban and RBI’s board advisable the identical on November 8, hours prior to Modi announced the note ban. “We want to comprehend how many new foreign money notes have been printed and what is the cash supply scenario,” said some other member. “We would like to understand the impact of note ban on industrial manufacturing, agriculture and resultant job losses.”

consistent with the documents submitted earlier than the panel via RBI and the ministry, the Centre used to be alarmed on the spurt in the circulation of counterfeit Rs 500 and Rs 1,000 notes and needed to take immediate action. the data provided to the panel confirmed a rise of seventy six.4 per cent in the provide of pretend Rs 500 notes and 109 per cent in faux Rs 1,000 notes over the previous five years. Fearing that the infusion of fake currency via a neighbouring us of a contributed to terror funding and black money, the government opted for the be aware ban.

Estimating the fake forex in India at Rs 400 crore, the government file stated authorities had seized fake currencies value Rs 27.79 crore until September 2016. It was Rs 43.8 crore in 2015 and Rs 41 crore in 2014.

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Now, you can withdraw up to Rs 10,000 in a day from an ATM

The Reserve Bank of India (RBI) on Monday relaxed the per day cash withdrawal limit from automated teller machines (ATM) to Rs 10,000 per card, from Rs 4,500 currently. The weekly limit, however, remains unchanged at Rs 24,000.

Current account holders can now withdraw up to Rs 1 lakh per week. Earlier, they were allowed to withdraw only up to Rs 50,000. This facility has been extended to overdraft and cash credit accounts as well.  

RBI had imposed these limits in November after the government banned Rs 500 and Rs 1,000 notes. The withdrawal limits are unlikely to be removed completely till RBI supplied the economy with sufficient amount of new notes, analysts said.

The daily withdrawal limit has been changed a number of times earlier. On November 8 — the day Prime Minister Narendra Modi announced the note ban — the central bank restricted daily withdrawal to Rs 2,000. It was increased to Rs 4,500 a few days later. This was quickly rolled back to Rs 2,000; then increased to Rs 2,500 per day. From December 30, the daily limit was fixed at Rs 4,500.

However, in all these changes, the weekly withdrawal limit was not changed — unless one was withdrawing money for special purposes such as marriage. A bank customer had to issue a cheque to withdraw higher amounts of cash from bank counters.

In a number of banks, the daily withdrawal limit was Rs 10,000 a day even before the note ban started. ATMs, too, were programmed to dispense no more than Rs 10,000. So, for some, the cash regulations had returned to normal, but for the weekly withdrawal limit.

Cash availability, too, had improved, with more new Rs 500 and Rs 2,000 notes coming into the system.

According to a Bank of India executive, the supply of currency notes (of various denominations) from December 2016 had increased substantially, leading to improved availability at branches and ATMs. While dispensing currency notes, the bank’s own customers were the priority, he added.   

Compared to the last month, more currency notes were being sent to semi-urban and rural networks, said the banker.

The expanded withdrawal limit would help banks as well as customers to bring down the transaction cost paid to switch providers. The charges associated with ATM usages were waived off by RBI till December 30.

Technically, from January 1, banks were free to charge their customers if they use ATMs for more than five times a month. But given the paucity of cash, some banks had extended the ATM fee waiver after January, deciding to absorb the cost themselves.  Now the charges can be reintroduced.

The increase in current account withdrawal would greatly aid small businesses as well as companies that have to pay wages to employees in cash. Many small units had to be closed down as owners could not pay in cash. Now, those units can hope to be back in business, as usual, bankers added.

Budget 2017: Online payments may get cheaper with tax rebates in offing

Payments through digital channels including internet banking, debit card and credit card are likely to become cheaper. The Union Budget, which will be presented on February 1, is likely to announce tax rebates on such transactions.

Currently, payments ranging from restaurant bills to booking a airline ticket, carry a service tax of 14 percent. In addition, a total of 1 percent charge is levied by way of Swachh Bharat and Krishi Kalyan Cess.

A senior banker said that in the pre-Budget meeting with the Finance Ministry, incentives for cashless payments were one of the main areas of discussions.

“Until the Goods and Services Tax (GST) is implemented, existing rates will continue. The ministry officials have also given a positive response to incentivise customers,” the executive said.

During the demonetisation period, one of the primary objectives that the government highlighted was to create a cashless India where the money trail is visible and each rupee is accounted for. However, with the ATM transaction fee as well as e-payment charges still applicable, not enough incentives are being provided for customers to use the digital channel.

Banks, which had earlier waived off the Merchant Discount Rate (MDR) as well as ATM transaction fee, have now brought them back. Their reason being they are required to pay the card companies. “Even when we waived off charges in the interim period, we were required to still pay the charges from our own books. Because we have to give benefits to customers, we should be incentivised, too,” said the chief of a private sector bank.

There are, however, some exceptions. State Bank of India   (SBI) said that it decided to waive completely the MDR charges on debit card transactions for all small merchants having an annual turnover of up to Rs 20 lakh, for a period of one year, up to December 31, 2017.

This, the bank said, is with a view to help small merchants overcome the apprehensions towards joining this journey by installation of Point of Sale (PoS) terminals in their shops.

Bankers also said that there is a reluctance among customers to use cards for payments, since there is an additional charge imposed. This is especially true for large-value transactions where convenience fees and service tax are much higher.

With the government banning old Rs 500 and Rs 1000 notes, all banks have seen a marked rise in digital transactions. With additional incentives on cards, bank officials expect the uptake to rise even further.

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Sensex reclaims 27,000, Nifty 8,300 ahead of Trump's first presser

Among broader markets, BSE Midcap and BSE Smallcap rose 0.7% and 0.6% respectively

Benchmark indices continued trading higher tracking Asian markets, which were trading at 2-month high as investors awaited cues from President-elect Donald Trump's first presser due later in the day.

At 10:21 am, the Sensex was trading at 27,051, up 152 points, and the Nifty was ruling at 8,338, up 49 points.

Among broader markets, BSE Midcap and BSE Smallcap rose 0.7% and 0.6% respectively.   

"Anything beyond 8,345 region can be expected to attract volatility for the time being. On the other hand 8,400-8,450 appear as the next objectives in a very optimistic scenario, while slippage past 8,230 could allow bears to tighten grip," said Geojit BNP Paribas in a note.

On Monday, foreign portfolio investors (FPIs) sold shares worth a net Rs 21.20 crore, while Domestic institutional investors (DIIs) bought shares worth a net Rs 253.36 crore, provisional data available with BSE showed.

Sectors and Stocks

Tata Steel, Coal India, Lupin, L&T and HDFC Bank were the top gainers while Bajaj Auto fell around 1% making it the biggest laggard in BSE Sensex.

IOC gained over 1% after reports global brokergae CLSA said it higher chances of earnings surprise by IOC than peers and stabilisation of Paradip refinery remains a key trigger for the stock.

IndusInd Bank rose over 3% to Rs 1199.7 on BSE Sensex after strong Q3 results. Also, CLSA maintained ‘Buy’ on the stock and upgraded the target price to Rs 1,450 from Rs 1400 earlier and Morgan Stanley is overweight with a target price of Rs 1,500.

Shares of metal companies are in focus with the Nifty Metal and S&P BSE Metal index hitting their respective 52-week highs on Wednesday in intra-day trade after rally in steel stocks.

JSW Steel, Tata Steel, Hindalco Industries, National Aluminium Company (Nalco), Coal India, Jindal Steel & Power (JSPL), Steel Authority of India (SAIL), NMDC and Bhushan Steel from the metal index were up 2% to 6%.

Auto sales at 16-year low

Monthly automobile sales growth rate in India slipped to a 16-year low in December with total vehicle sales declining by 18.66 per cent as demonetisation hits the industry hard.

According to latest Society of Indian Automobile Manufacturers (Siam) data, most of the major segments, including scooters, motorcycles and cars, witnessed record decline December sales as the automobile sector continued to bear the brunt of negative consumer sentiments in the wake of the ban of Rs 500 and Rs 1,000 notes announced in November. It sparked a severe cash shortage that dented demand. Sales fell 18.66% in December to 1.2 million units, the biggest monthly drop since the same month in 2000.

Mixed outlook on Indian economy

The World Bank has cut India’s projected GDP to 7% from 7.6% in the current financial year after taking into account the impact of demonetisation. It stated the impact of demonetisation was for the short term. The forecast is just a tad below the Advance Estimates put out by the Central Statistical Office (CSO) which estimated the growth to be at 7.1% without considering the effect of demonetisation.

Meanwhile, International rating agency Moody’s Investors Service maintained a positive outlook (Baa3 positive) on India and said that beyond the short-term negative impact on growth, demonetisation has the potential to raise government revenues and provide some fiscal space to support growth if required.

Other Developments

Gold rose to a six-week peak on Tuesday, supported by earlier weakness in the dollar ahead of a news conference on Wednesday by U.S. President-elect Donald Trump. The market is looking for more clues on Trump's spending plans in the first speech since his shock election win in November.

Oil prices edged up on Wednesday, lifted by a small supply cut by crude exporter Saudi Arabia, but markets remained under pressure from signs that the planned OPEC output reductions were being poorly implemented and as supplies from elsewhere rose.

Prices for Brent crude futures, the international benchmark for oil prices, were trading at $53.77 per barrel, up 13 cents from their last close while WTI crude oil futures were at $50.96 a barrel, 14 cents above their last settlement.

Global Markets

Asian shares stood near two-month highs on Wednesday as investors looked to President-elect Donald Trump's news conference later in the day for any clues to his policies on tax, fiscal spending, international trade and currencies.

While his plan for tax cuts and infrastructure spending has boosted U.S. shares and the dollar, his protectionist statements have kept many investors on guard.

MSCI's broadest index of Asia-Pacific shares outside Japan was little changed in early Wednesday trade.

It stood at its two-month highs, essentially coming back to where it was just before the U.S. election after recovering from their losses of over five percent.

Japan's Nikkei ticked up 0.2%.

On Wall Street, the S&P 500 ended flat on Tuesday, as investors look also to earnings season, which starts this week, to assess if the record levels are justified, following 5% gains since the election. Dow Jones index fell 0.2%, to close at 19,855 while Nasdaq Composite index inched 0.4% higher for record close.

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Expect Cotton prices to trade sideways: Angel Commodities

Angel Commodities report on Cotton Cotton complex continue to trade higher on reports good demand from the industrial buyers and firm international market also supporting the domestic sentiments. Moreover, the supplies have not peaked in the season which is a major concern. Cotton prices have moved up recently as market sentiment has improved with the Cotton Corporation of India (CCI) resorting to purchase of the commodity at commercial rates from different parts of key cotton growing regions in the country.

ICE cotton futures closed lower on Monday mainly on weaker export figures and profit booking from higher levels. As per USDA data, net upland sales of 183,700 RB for 2016/2017 were down 47 % from the previous week and 45% from the prior 4-week average. However, speculators raised their net long in cotton by 5,573 contracts to 99,820 contracts, bringing their bullish stance back toward last month's record high in the week to Jan. 3. Outlook We expect MCX cotton futures to trade sideways on expectation of correction from higher level, while kapas may trade higher on physical demand. Cotton prices were primarily driven by low cotton supply in the local market and also getting supported by the news of purchase by the CCI.

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Netflix: A Pricey Stock With A Troubled Future

Summary

NFLX faces serious headwinds from increased competition, net neutrality, and a saturated US market.

NFLX's current valuation is too sanguine and I expect a significant pullback in 2017.

Many prudent NFLX investors have likely held onto their stock until the Trump administration's reduced tax rates become effective. Expect selling pressure once the new rates are announced.One of the main tenets of successful investing is to find companies that possess a competitive advantage. This advantage gives the company a superior position compared to competitors for a variety of reasons. Warren Buffett espouses the importance of investing in companies only if they have a significant competitive advantage in order to create a moat between the company and competitors. This moat allows for pricing power, which ultimately leads to profits.

Netflix (NASDAQ:NFLX) was the first mover in the industry and cannibalized Blockbuster by successfully envisioning the future. However, with the proliferation of competitors, it is apparent that this advantage is rapidly degrading. The industry remains marred by low levels of brand loyalty. The type of content the competitor has is the most influential buying criteria for the customer. As such, NFLX must pay an increased amount for new content and is required to lock-in long-term deals, which makes NFLX an inherently riskier company.

Headwinds

Competition

By being the first major player in the industry, Netflix enjoyed relatively high purchasing power. Licensing of titles is typically done through multi-year exclusive subscription video-on-demand licenses (SVOD). Through this method, Netflix was able to lock in content at attractive prices. Unfortunately, with the recent heightened competition from a wide range of companies such as Amazon (NASDAQ:AMZN), Hulu, Microsoft (NASDAQ:MSFT), and AOL (NYSE:AOL), these costs are set to rise dramatically. Moving forward, Netflix will have to pay substantially more for content, which will impinge upon margins. Evidence of this trend is percolating as the divergence between free cash flow and net income continues to increase. (I'll further explain this trend below).

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Budget Date Decided Much In Advance Of Poll Schedule: Arun Jaitley

Refuting the Opposition's allegation, Mr Jaitley said the date for presenting the budget was decided much earlier, before the announcement of Punjab polls and it would be wrong to say the date was fixed keeping Punjab elections in view.

Finance Minister Arun Jaitley on Sunday said the date for presenting the Union Budget on February 1 was decided much in advance of the EC's announcement of Punjab polls three days later, dismissing Opposition allegation that the budget was scheduled keeping in view the state elections.

He said there was a practice to present the budget on February 28 but this year it would be presented on February 1.

"The idea is to pass the Finance Bill by March 31, so that next year's expenses could be started from April 1," he said.

Refuting the Opposition's allegation, Mr Jaitley said the date for presenting the budget was decided much earlier, before the announcement of Punjab polls and it would be wrong to say the date was fixed keeping Punjab elections in view.

Political parties including Congress, Left, Samajwadi Party and BSP have voiced reservations against presenting the Budget just three days ahead of the Punjab polls as they feel the budget may be used to announce sops to influence voters.

Mr Jaitley also played down the trouble people faced due to the sudden move by the Union government on November 8 to demonetise high-value currency notes, saying gone were the days when people were seen standing in long queues outside banks.

"Now adequate new currency is available with banks as well as in the market," he said.

Lauding the work done by Prime Minister Narendra Modi in the past three years, Jaitley said "surgical strike" and demonetisation have been largely praised across the world since such steps strengthen the nation's internal security.

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