Power shift!

Nearly all men can stand adversity, but if you want to test a man's character, give him power. - Abraham Lincoln There is a power shift in the Centre as far as ministries are concerned. P Chidambaram is back to where he always perhaps was - the finance ministry. While half of India went without power on Tuesday, there is no full-time Power Minister now as Sushil Kumar Shinde moves to ‘Home.’ Corporate affairs minister Veerappa Moily will have to shoulder additional charge of the power ministry. Reports indicate that a large scale restructuring in portfolio (government) may take place after the monsoon session in September. The stock market didn’t really run out of power. Nifty managed to regain its lost ground to close above 5200 levels. The 5165 level is a critical reversal point. The outlook today is a flat start in the early hours. US stocks were lower and Asian indices are mostly in the red. A softer Chinese manufacturing data has hurt sentiment. India and South Korea will report their latest manufacturing data later today. Expectations of stimulus action this week by the U.S. Federal Reserve and the European Central Bank are also lessening. The Reserve Bank of India has sounded its concerns and reduced the estimate of growth to 6.5 per cent from 7.3 per cent. Inflation is forecast at 7 per cent at the end of the year. SLR has been reduced from 24% to 23% while rates have otherwise been maintained on expected lines. Against this backdrop of heightened global uncertainty and domestic macroeconomic pressures, the challenge for monetary policy is to maintain its priority of containing inflation and lowering inflation expectations, the RBI stated adding that lowering policy rates right now will aggravate inflation. Oil and copper fell while the yen rose. Brent September crude was down $1.28 to settle at $104.92 a barrel, then weakened further to $104.10 in post-settlement trade. US September crude fell $1.72 to settle at $88.06 a barrel, then dropped to $87.31 in post-settlement trade. Crude trading volumes are below 30-day averages. Meanwhile, the rupee on Tuesday fell by seven paise to close at 55.65 against the US dollar. Key Results Today: Adani Ports, Adani Power, Archies, BASF India, Ceat, Century Enka, Century Textiles Industries, Engineers India, Fame India, Federal Bank, Glaxosmithkline Consumer Healthcare, Gulf Oil Corp, Jaypee Infratech, Manappuram Finance, Orient Paper & Industries, PVR, Standard Chartered , Voltas Trend in FII flows: The FIIs were net buyers of Rs.8.79bn in the cash segment on Tuesday while the domestic institutional investors (DIIs) were net sellers of Rs.4.93bn, as per the provisional figures released by the NSE. Global Data Watch today: EU European Council Meeting, China National Holiday, China NBS Manufacturing PMI (Jul), Australia House Price Index (Q2), China HSBC Manufacturing PMI (Jul), Japan Vehicle Sales (Jul), UK Nationwide Housing Prices (Jul), Australia RBA Commodity Index SDR (Jul), Spain Manufacturing PMI (Jul), Italy Markit Manufacturing PMI (Jul), France Markit Manufacturing PMI (Jul), Germany Markit Manufacturing PMI (Jul), EU Markit Manufacturing PMI (Jul), EU Manufacturing PMI (Jul), UK Markit Manufacturing PMI (Jul), UK 10-year Bond Auction, US ADP Employment Change (Jul), US Markit Manufacturing PMI (Jul), US Construction Spending (Jun), US ISM Manufacturing PMI (Jul), US ISM Prices Paid (Jul), US Fed Interest Rate Decision, US Fed’s Monetary Policy Statement, US Total Vehicle Sales (Jul), Japan Monetary Base (Jul)