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Monday, July 08, 2013

Market may edge lower in early trade on weak Asian stocks

The market may edge lower in early trade on weak Asian stocks. Trading of CNX Nifty futures on the Singapore stock exchange indicates that the Nifty could fall 49.50 points at the opening bell. Asian stocks dropped on Monday amid concern a credit squeeze in China will curb growth and after a better-than-forecast monthly US jobs report fueled speculation that the Federal Reserve may begin reducing stimulus this year.

Reliance Communications (RCom) said on Sunday, 7 July 2013, that its board of directors has in-principle decided on a demerger of the real estate held by RCom into a separate unit to be called Reliance Properties, to unlock substantial value for the benefit of its about 20 lakh institutional and retail shareholders. The proposed separation of real estate into a separate unit is part of RCom's strategic plan to divest non-core assets, and focus on its core wireless and enterprise business. Reliance Properties will be a separate listed company. All shareholders of RCom will receive fully tradeable pro-rata shareholding in Reliance Properties, free of cost, based on their existing shareholding in RCom.

The preliminary and indicative monetisable value of RCom's real estate on development is estimated by independent valuers at over Rs 12000 crore ($2 billion), which is equal to Rs 60 ($1) per RCom share.

Reliance Properties will work with leading global partners to develop the real estate, and unlock this value for the benefit of its shareholders. The properties proposed to be developed by Reliance Properties include prime land at Dhirubhai Ambani Knowledge City, Navi Mumbai measuring nearly 135 acres, with saleable area of over 15 million square feet and prime property near Connaught Place, New Delhi measuring nearly 4 acres.

The board has constituted a committee to consider the matter in detail, and prepare the necessary Demerger Scheme, etc. in consultation with legal and other advisors. The demerger will be subject to approvals from shareholders, lenders, Courts, etc.

DLF has completed the Rs 325.38-crore deal to sell 150 megawatts (MW) wind turbine project in Gujarat to Bharat Light and Power. The transaction is in line with the DLF's objective of divesting its non core assets, the company said in a statement.

FMCG and agri-sector stocks will be in focus after the latest data showed a further pick-up in sowing of kharif crops. The Centre on Friday, 5 July 2013, said that as per reports received from state governments, the total sown area in the country stands at 401.69 lakh hectare (lh) as on 5 July 2013, compared with 215.07 lh at this time last year.

The India Meteorological Department said on Friday, 5 July 2013, that the cumulative seasonal rainfall for the country as a whole from 1-30 June 2013 has been 32% above the Long period average (LPA) with excess/normal rainfall activity over 92% area of the country. For the country as a whole, cumulative rainfall during this year's monsoon has so far upto 3 July been 27% above the LPA. The cumulative seasonal rainfall activity continued to be excess over all the four homogeneous regions except east & northeast India, where it was 37% below LPA.

IDBI Bank after market hours on Friday, 5 July 2013 said that the Government of India (GoI), Ministry of Finance, Department of Financial Services has, vide their letter dated 5 July 2013, appointed M. S. Raghavan as Chairman & Managing Director of IDBI Bank from 5 July 2013, for a period upto 30 June 2015, i.e., the date of his attaining the age of superannuation or until further orders, whichever is earlier.

Ashok Leyland after market hours on Friday, 5 July 2013 said it has secured an order from the Institute of Road Transport (IRT), Tamil Nadu for the supply of 2,610 buses. IRT is a nodal organization that procures buses for all transport corporations in Tamil Nadu.

Key benchmark indices edged higher in volatile trade on Friday, 5 July 2013, ahead of the key US nonfarm payroll data that was due later in the global day that day. The S&P BSE Sensex advanced 84.98 points or 0.44% to settle at 19,495.82 on that day, its highest closing level since 1 July 2013.

Foreign institutional investors (FIIs) sold shares worth a net Rs 15.70 crore on Friday, 5 July 2013, as per provisional data from the stock exchanges.

Asian stocks dropped on Monday, 8 July 2013, amid concern a credit squeeze in China will curb growth and after a better-than-forecast monthly US jobs report fueled speculation that the Federal Reserve may begin reducing stimulus this year. Key benchmark indices in China, Hong Kong, Indonesia, Singapore, South Korea and Taiwan shed by 0.94% to 2.19%. Japan's Nikkei Average rose 0.27%.

US stocks surged on Friday, 5 July 2013, after government data showed the nation added more jobs than forecast last month. The non-farm payrolls increased by 195,000 in June and the unemployment rate held steady at 7.6% as more people entered the workforce. Job growth in previous months also was revised higher. Federal Reserve Chairman Ben Bernanke on 19 June 2013 said that the central bank may taper the pace of its bond purchases, currently set at $85 billion a month, as early as this year if the economy continues to improve in line with its forecasts.

The minutes of Federal Open Market Committee's (FOMC) policy meeting held on 19 June 2013 will be released on Wednesday, 10 July 2013. Bernanke is also due to deliver a speech on that day.