Sensex, Nifty settle at 6-week lows

Key benchmark fell for the seventh straight day to hit six-week closing lows as poor Q2 September 2011 earnings and euro-zone debt worries dampened sentiment. Data showing selling by foreign funds recently also weighed on sentiment. Intraday volatility was high. The BSE Sensex lost 90.20 points or 0.55%, up close to 205 points from the day's low and off close to 25 points from the day's high.

Auto stocks extended recent losses triggered by concerns that higher interest rates could crimp sales of automobiles. Bank stocks extended recent losses triggered by concerns about rising defaults in a slowing economy. Index heavyweight Reliance Industries trimmed intraday losses. L&T recovered after hitting 52-week low. The market breadth was weak. Some metal stocks recovered. Select pharma stocks gained.



The Sensex has lost 1,198.02 points or 6.81% in the past seven trading sessions from a recent high of 17,569.53 on 8 November 2011. The Sensex has lost 1,333.50 points or 7.5% this month so far. The Sensex has slumped 4,137.58 points or 20.17% in calendar 2011. From a 52-week high of 20,664.80 on 3 January 2011, the Sensex has lost 4,293.29 points or 20.77%. From a 52-week low of 15,745.43 on 4 October 2011, the Sensex has risen 626.08 points or 3.97%.

Coming back to today's trade, intraday volatility was quite high. The market edged lower in early trade on weak Asian shares. The market extended initial losses to hit fresh intraday low in morning trade. The market trimmed losses after hitting six-week low in mid-morning trade. Intraday recovery witnessed in mid-morning trade proved short-lived. The market weakened once again in early afternoon trade. The Sensex and Nifty hit fresh 6-week lows. Key benchmark recovered amid high volatility in afternoon trade as IT stock recovered from the day's lows. The market weakened once again in mid-afternoon trade as European shares dropped in early trade. The market recovered in late trade as European shares moved off lows.

Corporate earnings have been weak. The combined net profit of a total of 3,687 companies declined 35.9% to Rs 67529 crore on 20.6% growth in sales to Rs 1135564 crore in Q2 September 2011 over Q2 September 2010. The Q2 earnings season got over on Tuesday, 15 November 2011.

Data showing selling by foreign funds recently also weighed on sentiment. Foreign institutional investors (FIIs) sold shares worth Rs 195.20 crore on Thursday, 17 November 2011, as per the provisional data from the stock exchanges. Their outflow totaled Rs 1093.86 crore in three trading session from 15 to 17 November 2011.

The BSE Sensex lost 90.20 points or 0.55% to settle at 16,371.51, its lowest closing level since 7 October 2011. The index fell 65.02 points at the day's high of 16,396.69 in late trade. The index declined 296.72 points at the day's low of 16,164.99 in early afternoon trade.

The S&P CNX Nifty lost 28.95 points or 0.59% to settle at 4,905.80, its lowest closing level since 7 October 2011. The Nifty hit a high of 4,915.90. The index hit a low of 4,837.95 in intraday trade, its lowest level since 5 October 2011.

The BSE Mid-Cap index fell 1.03% and the BSE Small-Cap index declined 1.9%. Both these indices underperformed the Sensex.

BSE Sensex clocked turnover of Rs 2340 crore, higher than Rs 2206.98 crore on Thursday, 17 November 2011.

The market breadth, indicating the overall health of the market, was weak. On BSE, 2,013 shares fell and 873 rose. A total of 101 shares were unchanged.

From the 30-share Sensex pack, 18 fell and rest of them rose.

Index heavyweight Reliance Industries (RIL) fell 0.32% to Rs 808.05, extending 8.28% losses in the preceding four trading sessions. Nonetheless, the stock came off the day's low of Rs 788.05. RIL announced after market hours today that RIL and BP have established India Gas Solutions a 50:50 joint venture company which will focus on global sourcing and marketing of natural gas in India. The joint venture will also develop infrastructure to accelerate transportation and marketing of natural gas within the country.

RIL's unit Infotel Broadband Services recently acquired a 38.5% stake in privately held digital learning firm Extramarks Education. It did not disclose the financial details of the investment. The deal will help Extramarks develop its digital distribution services and expand market penetration, RIL said. Last year, Reliance acquired Infotel Broadband, the only company to win a nationwide licence for broadband wireless spectrum in a government auction, for $1 billion, marking its return to the telecom business.

Cipla rose 0.77%, with the stock gaining for the fourth straight day on good Q2 results. Net profit rose 17.47% to Rs 308.97 crore on 9.8% growth in income from operations to Rs 1804.28 crore in Q2 September 2011 over Q2 September 2010.

Another pharma major Sun Pharmaceutical Industries gained 1.36%.

Oil India fell 1.52%. Disinvestment Secretary Mohammad Haleem Khan on Friday, 18 November 2011, said that oil ministry has approved the finance ministry's proposal to sell some government stake in Oil India. Khan said the number of shares that the government will sell in Oil India is yet to be decided.

ONGC gained 0.74% after Khan said that the government will stick to the public offer route for selling shares in ONGC and Bhel.

IVRCL tumbled 11.83% after the company denied reports that it is venturing into mining in Africa. IVRCL clarified that it will continue to bid for projects abroad, including in Africa, under its engineering, procurement and construction (EPC) segment.

India's largest engineering and construction firm by sales, L&T, gained 0.85% to Rs 1243 on bargain hunting. The stock hit 52-week low of Rs 1201.55 today. The stock had fallen 11.5% in the past seven trading sessions.

India's largest power equipment maker by sales Bhel dropped 3.06% to Rs 275.95, extending 15.01% losses in the past six trading sessions. The stock hit 52-week low of Rs 267.20 today. The company announced after market hours on Monday 14 November 2011 that net profit rose 23.61% to Rs 1412 crore on 24.41% growth in total income to Rs 10765.37 crore in Q2 September 2011 over Q2 September 2010.

The growth in both topline and bottomline was despite a 60 basis point drop in operating margin to 18.6% due largely on account of higher other income and lower tax incidence. In addition, the company during the quarter has changed its policy of accounting leave encashment to 30 days a month (earlier 26 days a month) and thus the profit before tax was escalated to the extent of Rs 166 crore. But for this one item which moderated the staff cost, the contraction in operating margin would have been higher

Bhel had order backlog of Rs 1.61 lakh crore as on 30 September 2011. Bhel has decided to set up a new power equipment fabrication plant in Bhandara district in Maharashtra.

Jaiprakash Associates fell 0.8%, with the stock extending 20.88% losses in preceding seven trading sessions triggered by weak Q2 operating performance. Net profit rose 11% to Rs 128.65 crore on 2% growth in net sales to Rs 3132.41 crore in Q2 September 2011 over Q2 September 2010. A sharp surge in other income and decline in tax rate to 42% from 60% boosted bottom line. The core operating profit margin declined 80 basis points to 23.9%, mainly due to increase in employee costs.

Realty major DLF rose 0.22% on bargain hunting. The stock had fallen recently on weak Q2 results. The company announced on Thursday, 10 November 2011, that consolidated net profit fell 10.98% to Rs 372.41 crore on 2.27% rise in total income to Rs 2577.16 crore in Q2 September 2011 over Q2 September 2010.

DLF said it expects second half of the year ending March 2012 (FY 2012) to witness a stronger operational performance, both in terms of a scale up in launches in the plotted and group housing segments and deliveries of its projects across the cities of Gurgaon, Chennai and Cochin. DLF also expects the momentum on the non-core divestment plan to continue with increasing traction in the proposed divestment of its hospitality assets which would further help in moderation of its debt levels. With strategic capital expenditures being undertaken on improving the quality of its land bank and the build out of select commercial and infrastructure assets, the company is well positioned to capitalize on the growth opportunities as and when the demand scenario revives, DLF said in a statement.

DLF said that the Competition Appellate Tribunal has on 9 November 2011 issued a stay order on the demand on penalty and kept in abeyance the directions relating to modifications of conditions. This pertains to the order passed by the Competition Commission of India dated 12 the August 2011. While this is an interim order, the company believes that it has a strong case based on merits, DLF said. It may be recalled that the Competition Commission of India had imposed a Rs 630-crore penalty on the country's biggest property developer by sales in August as it found the company abusing its marker leadership position to the disadvantage of residents at a housing complex.

HDIL declined 1.08%, extending 27% losses in the preceding seven trading sessions triggered by weak Q2 results. MSCI recently said it will exclude the stock from the MSCI India index with effect from 1 December 2011. HDIL's consolidated net profit declined 24.41% to Rs 148.55 crore on 13.89% rise in total income to Rs 450.09 crore in Q2 September 2011 over Q2 September 2010.

Unitech shed 1.51%, extending recent steep slide triggered by weak Q2 results. Consolidated net profit dropped 46.8% to Rs 92.46 crore on 2.9% decline in net sales to Rs 626.06 crore in Q2 September 2011 over Q2 September 2010. The company announced Q2 results after market hours on Monday.

Unitech reiterated that the ongoing telecom matter pertains to Unitech Wireless Tamilnadu (Uninor), which is a separate legal entity engaged in the telecom business, and will not impact Unitech. The company said it will continue to focus on its real estate business, in the normal course.

Sobha Developers rose 0.54% on bargain hunting. The stock had fallen recently on weak Q2 results. Net profit declined 30.56% to Rs 40.90 crore on 22.91% decline in net sales to Rs 329.40 crore in Q2 September 2011 over Q2 September 2010.

Metal stocks were mixed. India's largest steel maker by sales Tata Steel fell 1.88% to Rs 392.50, extending recent losses triggered by weak Q2 numbers. The stock hit 52-week low of Rs 385.40 today. From the recent high of Rs 467.90 on 8 November 2011, the stock fell 14.51% in six trading sessions to settle at Rs 400 on 17 November 2011. Consolidated net profit fell 89.26% to Rs 212.43 crore on 11.73% rise in total income to Rs 32918.33 crore in Q2 September 2011 over Q2 September 2010.

Tata Steel said its performance was adversely impacted by higher global raw materials costs and lower average selling prices at Tata Steel Europe. Tata Steel's net debt at the end of September 2011 stood at Rs 45056 crore, compared to Rs 46627 crore at the end of March 2011.

Hindalco Industries rose 0.77% on bargain hunting. The stock hit 52-week low of Rs 118.40 today. The stock had fallen 12.1% in preceding six trading sessions on weak outlook issued by the copper and aluminium maker at the time of announcing Q2 results on 10 November 2011. Hindalco Industries said that the second half of FY 2012 (year ending March 2012) will be difficult due to global uncertainties, falling LME prices, and persisting cost pressures. The intensity of resource challenge, which accentuated in the first half of FY 2012 due to monsoon related issues is expected to moderate, the company said.

JSW Steel declined 5.88%. The company reported a consolidated net loss of Rs 669.32 crore in Q2 September 2011, compared with net profit of Rs 373.26 crore in Q2 September 2010. Total income rose 33.33% to Rs 8180.60 crore in Q2 September 2011 over Q2 September 2010. The company announced the results early this week.

National Aluminum Company rose 2.42%. The stock had fallen 15.44% in the preceding seven trading sessions on weak Q2 results. Net profit fell 37.8% to Rs 139.34 crore on 11.6% growth in total income to Rs 1746.01 crore in Q2 September 2011 over Q2 September 2010.

Steel major Steel Authority of India (Sail) rose 3.31%. The stock had declined recently after MSCI removed the stock from MSCI India index with effect from 1 December 2011. Sail and Oman Oil Co. S.A.O.C. have signed an initial pact to jointly set up a steel plant in Oman with an estimated investment of $3 billion, steel minister Beni Prasad Verma said Tuesday. He told reporters that the two state-run companies aim to set up the plant with a capacity of 3 million metric tons a year once a feasibility study on the project was completed.

Among other metal stocks, NMDC, Sesa Goa, Sterlite Industries and Jindal Steel & Power shed by between 0.37% to 4.11%.

Sugar stocks rallied after Minister of State for Consumer Affairs, Food and Public Distribution K.V. Thomas said on Thursday that a group of ministers headed by Finance Minister Pranab Mukherjee is likely to take a decision next week on allowing sugar exports in 2011-12 sugar marketing year. Export of sugar from India, the world's second largest producer and the biggest consumer, is regulated by the government. Shree Renuka Sugars, Bajaj Hindusthan and Balrampur Chini Mills jumped 5.4% to 9.19%.

IT stocks fell on euro-zone debt worries. Europe is the second biggest outsourcing market for Indian IT firms after the US. India's second largest software services exporter Infosys fell 0.41%. A US federal judge has refused to allow Infosys an out-of-court settlement in a case filed by one of the firm's employees, a setback to the company, which is facing allegations of visa rule violations. Jack Palmer, a principal consultant at Infosys, filed a lawsuit against Infosys in the Alabama state court earlier this year, alleging the company sought his help to circumvent US visa laws. The lawsuit was later moved to the federal court. Mr. Palmer accused Infosys of using short-term business visit visas to circumvent the fewer and expensive work visas meant for high-skilled labor. His suit led to a probe by US authorities, including an inquiry by a US Senate subcommittee. Infosys has previously denied any wrongdoing.

India's third largest software services exporter Wipro rose 1.88% to Rs 374.55, up from the day's low of Rs 360.10. The company announced after market hours on Tuesday, 8 November 2011, that Premier Foods has selected Wipro Technologies, the global IT, consulting and outsourcing business of Wipro, as a strategic technology partner. As part of the five year strategic relationship, Wipro will be supporting both systems and processes to enhance efficiency of Premier Foods' supply chain. This relationship will enable Premier Foods to realise quantifiable benefits for a known budgetary expenditure with minimal exposure to variable costs.

India's largest software services exporter TCS declined 2.24%, with the stock declining for the fifth straight day. TCS said it continues to see stable pricing environment and isn't seeing cancellation of any projects by clients, its chief financial officer said on Friday, 18 November 2011. The clients are closely monitoring the unfolding of the global economic situation but so far haven't cut their technology budgets or delayed planned projects, S. Mahalingam told reporters. He also said that the company, which gets most of its revenue from the US and Europe, remains concerned over recent currency volatility.

Media conglomerate Zee Entertainment Enterprises rose 3.51%. The Zee Group today, 18 November 2011, said it will invest up to $250 million to set up a fund for development, production and acquisition of health and wellness content for its Veria Living television network in the US. The setting up of this fund is a part of Zee Group's five-year plan to expand Veria Living's presence in the US and beyond, Chairman Subhash Chandra said in a statement.

The New York-headquartered Veria Living television network is available throughout the US to DISH Network, Verizon FiOS and Frontier Communications subscribers, it added. Zee Group runs Hindi-language general entertainment channel Zee TV, Hindi-language movie channel Zee Cinema, Ten Sports and several regional-language channels.

Tata Power Company rose 2.42% to Rs 97.45, off the day's low of Rs 94.05.

Auto stocks extended recent losses triggered by concerns that higher interest rates could crimp sales of automobiles. Purchases of automobiles, including that of cars, utility vehicles and commercial vehicles are substantially driven by financing.

India's largest commercial vehicle maker by sales Tata Motors fell 2.74%, extending Thursday's 3.87% losses. The company's global sales in October rose 10% from a year earlier to 95,789 vehicles. India's biggest auto maker by revenue said its UK-based Jaguar Land Rover unit sold 26,158 vehicles in October, up 39% from a year earlier. Sales of Jaguar cars grew 63% to 5,231 units, while those of Land Rover sport-utility vehicles gained 34% to 20,927 units. The company said it sold 43,184 trucks and buses globally during the month, up 6% from a year earlier.

Tata Motors announced after market hours on Monday that consolidated net profit fell 15.56% to Rs 1877.30 crore on 26.9% growth in net revenue to Rs 36197.50 crore in Q2 September 2011 over Q2 September 2010. The company's EBIDTA (earnings before interest, depreciation, taxation and amortization) margin declined to 13.3% from 14.7% in Q2 September 2010.

Tata Motors' British unit Jaguar Land Rover's (JLR) profit after tax declined 2.4% to 237.5 million pounds 30.3% growth in net revenue to 2,928.5 million pounds in Q2 September 2011 over Q2 September 2010. JLR's EBIDTA margin declined sharply by 170 basis points due to unfavorable exchange rates and cost pressures. Tata Motors said the product mix and regional mix continues to be strong.

India's largest car maker by sales Maruti Suzuki India fell 0.78% to Rs 940.70. The stock hit 52-week low of Rs 910 today. Maruti had clarified recently that the decision to purchase land in Gujarat is towards building additional capacity. It had also said that the board of directors approved the purchase of land in Gujarat for future capacity requirements of the company. The logistics for reaching the finished cars to the large domestic markets in West and South India and the close proximity of the Mundra port for future exports, played an important role in the decision, Maruti said.

India's largest motorcycle maker by sales Hero MotoCorp gained 3.05%. Early this month, Hero MotoCorp reported 1.3% growth in its October sales at 5.12 lakh units. The company had sold 5.05 lakh units in the corresponding month last year.

Bajaj Auto declined 1.52%. The company's total sales rose 7% to 3.95 lakh unit in October 2011 over October 2010. The company announced the monthly sales data early this month. The company said that there was production loss of 25,000 motorcycles at Pantnagar plant in October 2011 as curfew imposed in the region in early October constrained sales.

India's largest tractor maker by sales Mahindra & Mahindra (M&M) fell 2.74%, extending recent losses triggered by weak Q2 results. M&M's net profit fell 2.78% to Rs 737.38 crore on 34.75% increase in total income to Rs 7592.14 crore in Q2 September 2011 over Q2 September 2010. The result was announced early this week.

The company said during market hours on Thursday that consolidated net profit fell 2.69% to Rs 682 crore on 62.1% growth in gross revenue plus other income to Rs 15250.40 crore in Q2 September 2011 over Q2 September 2010. The figures are not strictly comparable as Q2 September 2010 results do not include results of Ssangyong Motor Company and its subsidiaries and share in PAT of Satyam Computer Services. On a comparable basis, net profit rose 5.1% to Rs 682 crore on 29.6% growth in revenue to Rs 15250.40 crore in Q2 September 2011 over Q2 September 2010, M&M said in a statement.

M&M and Telephonics Corp, a unit of US-based Griffon Corp, on Thursday, 17 November 2011, signed an initial agreement to form a joint venture to build airborne radar systems in India. The two companies said also that they have sought approval from the Indian government's foreign investment promotion board for the joint venture.

Shares of state-run oil-marketing companies (PSU OMCs) rose as crude oil prices fell. Indian Oil Corporation (IOC), and BPCL rose by between 1.98% to 2.25%. Lower crude oil prices will reduce under-recoveries of PSU OMCs on domestic sales of diesel, LPG and kerosene at controlled prices. The government has already decontrolled pricing of petrol.

Meanwhile, a meeting the Empowered Group of Ministers (EGoM) scheduled for November to review diesel and cooking fuel prices has been reportedly put off. The meeting was scheduled to happen before the winter session of parliament which starts on 22 November 2011. The government controls the prices of diesel, kerosene and cooking fuel to keep a lid on inflation.

Hindustan Petroleum Corporation (HPCL) jumped 6.26% after the company said it has entered into a memorandum of understanding (MoU) with Greater Calcutta Gas Supply Corporation (GCGSCL) and GAIL (India) to carry out natural gas business in the city of Kolkata and its adjoining districts.

Oil prices tumbled on Thursday, with US crude dropping almost 4% as investors booked profit after a recent sharp rally. US crude for December delivery, which expires on Friday, 18 November 2011, settled at $98.82, down $3.77, or 3.67% the biggest one-day percentage loss for front-month crude on the New York Mercantile Exchange since 28 September 2011.

GAIL (India) fell 0.41%. Chairman, B.C. Tripathi said on Thursday that GAIL (India) is considering buying BG Group PLC's stake in Gujarat Gas Company. London-listed explorer BG Group is looking to divest its stake in the Indian city gas distribution company. It acquired a majority stake in Gujarat Gas in 1997 and currently holds 65.12% of the company. Gujarat Gas distributes gas to commercial, industrial and domestic consumers through 42 retail outlets in Gujarat. "We are examining it (the stake)," Mr. Tripathi told media reporters. "We're in the same business (gas distribution), so it makes good sense for us. He said."

Reliance Infrastructure fell 1.48%. The company said that in accordance with the terms of external commercial borrowings (ECBs) aggregating $360 million (about Rs 1 815 crore) raised by the company in November 2006, the company has repaid the entire outstanding ECBs by making payment on the due date i.e. 16 November 2011.

Bank stocks extended recent losses triggered by concerns about rising defaults in a slowing economy. India's largest private sector bank by net profit ICICI Bank fell 0.91% to Rs 770.15, extending 12.19% losses in past seven trading sessions. The stock hit 52-week low of Rs 749 today. ICICI Bank's consolidated net profit rose 43% to Rs 1992 crore in Q2 September 2011 over Q2 September 2010. Standalone profit after tax increased 22% to Rs 1503 crore in Q2 September 2011 over Q2 September 2010. Net interest income increased 14% to Rs 2506 crore in Q2 September 2011 over Q2 September 2010. Fee income increased 7% to Rs 1700 crore in Q2 September 2011 over Q2 September 2010. Provisions decreased 50% to Rs 319 crore in Q2 September 2011 over Q2 September 2010. The result was announced on 31 October 2011.

ICICI Bank's current and savings account (CASA) ratio stood at 42.1% as on 30 September 2011. Net non-performing asset ratio decreased to 0.8% as at 30 September 2011 from 1.37% as at 30 September 2010 and 0.91% as at 30 June 2011.

India's largest bank by branch network State Bank of India (SBI) fell 1.82% to Rs 1725.50. The stock hit 52-week low of Rs 1702.95 today. The stock has been under pressure on increase in bad loans of the bank. The ratio of the bank's gross non-performing assets (NPAs) to gross advances increased to 4.19% as on 30 September 2011 from 3.35% as on 30 September 2010. The ratio of net non-performing assets to net advances increase to 2.04% as on 30 September 2011 from 1.7% as 30 September 2010.

SBI's net profit rose 12.35% to Rs 2810.43 crore on 23.43% rise in total income to Rs 29394.32 crore in Q2 September 2011 over Q2 September 2010. Provision for non-performing assets rose 35.08% to Rs 2921.22 crore in Q2 September 2011 over Q2 September 2010. The bank announced Q2 results during market hours on Wednesday, 9 November 2011.

The bank's consolidated net profit rose 46.8% to Rs 3470.43 crore on 8.76% rise in total income to Rs 41249.08 crore in Q2 September 2011 over Q2 September 2010.

SBI will not like to currently raise funds from overseas given the current market conditions, said Hemant Contractor, a managing director at the bank, on Monday, 14 November 2011. In September 2011, the state-owned bank had doubled its overseas borrowing aim to $10 billion.

India's second largest private sector bank by net profit HDFC Bank shed 0.25%. The bank's net profit rose 31.48% to Rs 1199.35 crore on 37.4% rise in total income to Rs 7929.38 crore in Q2 September 2011 over Q2 September 2010. The result was announced during market hours on 19 October 2011.

The asset quality of commercial banks needs to be closely watched in the changing interest rate environment as the sticky loan portfolio of small and medium enterprises might rise, the Reserve Bank of India (RBI) said in its 'Report on Trend and Progress of Banking in India 2010-11' released on Monday, 14 November 2011.

Shares of organized retailers extended recent gains on reports that the Union Cabinet will soon take up a proposal of allowing foreign direct investment (FDI) in multi-brand retail besides considering increasing the FDI limit in single brand retail from 51% to 100%. Pantaloon Retail, Shoppers Stop and Provogue rose by between 0.99% to 8.42%. At present, the government allows 51% FDI in single brand retail, 100% in cash and carry (wholesale) business. FDI is not allowed in multi-brand retail currently. The Finance Ministry has reportedly given its consent to the draft Cabinet note on opening the multi-brand retail to foreign investment.

Suzlon Energy clocked highest volume of 1.66 crore shares on BSE. Cals Refineries (1.34 crore shares), Pipavav Defence (1.04 crore shares), Shree Renuka Sugars (62.99 lakh shares) and Kingfisher Airlines (53.92 lakh shares) were the other volume toppers in that order.

SBI clocked highest turnover of Rs 151.97 crore on BSE. Tata Steel (Rs 127.27 crore), RIL (Rs 85.49 crore), L&T (Rs 77.17 crore) and Pipavav Defence (Rs 57.75 crore) were the other turnover toppers in that order.

The government has raised the limit for foreign investments in government and corporate bonds by $5 billion each. The move is aimed at boosting overseas capital inflows, which have remained muted so far this year, and it is likely to support the Indian currency that has shed nearly 13% against the dollar this fiscal year that started April 1. Thomas Mathew, joint secretary of capital markets, told reporters on Thursday, 17 November 2011, that the incremental limit of $5 billion can be invested in securities without any residual maturity criterion.

The government has put off introduction or consideration and passing of key bills such as the Land Acquisition Bill, Direct Taxes Code Bill, the Banking and Insurance Bills during the winter session of Parliament. The winter session is scheduled to start from 22 November 2011. The Banking Bill was referred to the standing committee in March, while the Insurance Bill was sent to the committee in 2009. Giving details about the business of the proposed session, Parliamentary Affairs Minister, Mr Pavan Kumar Bansal on Wednesday, 16 November 2011, said that the Standing Committee on Rural Development needs more time on the land acquisition bill.

Bansal announced a list of 31 bills for consideration and passage during the winter session. It government also aims to introduce 23 new bills during the 21 sittings of the session. The Finance Ministry will also seek the approval of Parliament for additional expenditure.

The Union Cabinet on Wednesday, 16 November 2011, cleared the pension bill but decided not to limit foreign direct investment in the sector, retaining the flexibility to prescribe or change limit through an executive decision. The government will place the Pension Fund Regulatory and Development Authority Bill 2011 in the winter session of Parliament.

Food price index rose 10.63% and the fuel price index climbed 15.49% in the year to 5 November 2011, data released by the government on Thursday, 17 November 2011, showed. In the previous week, annual food and fuel inflation stood at 11.81% and 14.50%, respectively. The primary articles price index was up 10.39%, compared with an annual rise of 11.43% a week earlier.

The Reserve Bank of India (RBI) has announced its first government bond buyback under its open-market-operations program this year, in a move aimed at easing liquidity in the cash-strapped banking system. The plan to buy up to Rs 10000 crore of government bonds on 24 November 2011 comes as banks have been borrowing between Rs 80000 crore and Rs 1.3 lakh crore daily for the past week, underscoring the cash crunch in the local banking system. The Reserve Bank of India said it will buy the bonds through a multi-security auction using the multiple price method. It will announce the details of the bonds that it will buy back at the auction shortly, it added.

RBI announced a 25 basis points hike in its key policy rate viz. the repo rate to 8.5% after half-yearly review of the monetary policy on 25 October 2011. The central bank cut its GDP growth forecast for the current fiscal year through March 2012 to 7.6% from 8% earlier. But it retained its March-end inflation projection of 7%. RBI said the projected inflation trajectory indicates that the inflation rate will begin falling in December 2011 (January 2012 release) and then continue down a steady path to 7% by March 2012. It is expected to moderate further in the first half of 2012-13. This reflects a combination of commodity price movements and the cumulative impact of monetary tightening. Further, moderating inflation rates are likely to impact expectations favourably.

Emerging markets such as India must take measures to boost long-term foreign direct investment to blunt volatility in exchange rates, and any capital control measures must be selective and temporary, a senior executive of the Asian Development Bank said on Monday, 14 November 2011. While capital flows and exchange rates are likely to be volatile in the short-term amid ongoing euro-zone debt concerns, India must focus on improving its investment climate by providing better infrastructure, putting in place a coherent manufacturing policy and developing financial markets, Managing Director General Rajat M. Nag said on the sidelines of the India Economic Summit.

European stocks fell Friday with losses across the board, as worries about sovereign debt contagion continued to rile markets, despite relative calm in bond markets. Key benchmark indices in France, Germany and UK were down by between 0.53% to 0.99%.

Concerns over rising Italian and Spanish government bond yields have hammered European equities this week as investors fear the crisis could lead to banking problems that could hit the global economy.

Meanwhile, Italy's new government has announced far-reaching reforms in response to a European debt crisis that on Thursday pushed borrowing costs for France and Spain sharply higher. Italy's new technocrat prime minister, Mario Monti, unveiled sweeping reforms to dig the country out of crisis and said Italians were confronting a "serious emergency".

Asian stocks fell for a fourth day on Friday, 18 November 2011, pulled down by fresh concerns about Europe's ongoing debt woes following a worrying Spanish bond auction. Key benchmark indices in China, Hong Kong, Japan, Indonesia, South Korea, Taiwan and Singapore fell by between 1% to 2.08%.

Trading in US index futures indicated that the Dow could rise 23 points at the opening bell on Friday, 18 November 2011. Investors dumped US stocks on Thursday, scared by the market's sudden fall through a key technical level brought on by more worries about Europe's debt troubles. New US claims for jobless benefits hit a seven-month low last week and permits for future home construction rebounded strongly in October, the latest data to suggest the economy was gaining traction.