M&M scales record high

Key benchmark indices closed nearly unchanged after witnessing intraday volatility. The barometer index, BSE Sensex, lost 9.68 points or 0.05%, up about 74 points from the day's low and off about 139 points from the day's high. The market breadth was weak. Index heavyweight and cigarette maker ITC dropped. Another index heavyweight Reliance Industries (RIL) also declined. Auto stocks rose on hopes of likely higher sales this month to be propelled by last week's festive Diwali season, with utility vehicles maker Mahindra & Mahindra (M&M) hitting record high and car major Maruti Suzuki India hitting 52-week high. The Sensex has declined 176.06 points or 0.95% in this month so far (till 20 November 2012). The Sensex has surged 2,874.40 points or 18.6% in calendar 2012 so far (till 20 November 2012). From a 52-week high of 19,137.29 on 5 October 2012, the Sensex has declined 807.97 points or 4.22%. From a 52-week low of 15,135.86 on 20 December 2011, the Sensex has risen 3,193.46 points or 21.10%. Coming back to today's trade, realty stocks slumped. Pharma major Lupin rose after the company said its subsidiary Lupin Pharmaceuticals Inc. has launched its Fenofibrate Tablets, 48 mg and 145 mg strengths in the United States. Capital goods stocks extended recent losses. Telecom stocks dropped. Shares of most public sector oil marketing companies (PSU OMCs) fell following overnight gain in crude oil prices. Banks were mixed. The market edged higher in early trade on firm Asian stocks. The market trimmed initial gains to hit fresh intraday low in morning trade. The market was range bound in mid-morning trade. The market pared intraday gains to hit fresh intraday low in early afternoon trade. The Sensex regained positive zone after briefly slipping into the red in afternoon trade. The Sensex once again slipped into the red and hit fresh intraday low in mid-afternoon trade. High volatility was witnessed during the last one hour or so of trade as key benchmark indices recovered after hitting fresh intraday low. The Sensex trimmed losses after hitting its lowest level in over 9-1/2 weeks. The 50-unit S&P CNX Nifty regained positive zone after hitting 6-1/2-week low. The BSE Sensex shed 9.68 points or 0.05% to settle at 18,329.32, its lowest closing level since 16 November 2012. The index fell 83.31 points at the day's low of 18,255.69 in late trade, its lowest level since 13 September 2012. The index jumped 128.91 points at the day's high of 18,467.91 in early trade, its highest level since 16 November 2012. The S&P CNX Nifty ended almost unchanged for the day at 5,571.55. The index hit a high of 5,613.70 in intraday trade, its highest level since 16 November 2012. The index hit a low of 5,548.35 in intraday trade, its lowest level since 5 October 2012. The market breadth, indicating the overall health of the market, was weak. On BSE, 1,802 shares fell and 1,051 shares rose. A total of 123 shares were unchanged. The turnover on BSE amounted to Rs 1949 crore, higher than Rs 1781 crore on Monday, 19 November 2012. From the 30-share Sensex pack, 16 stocks declined while the rest of them rose. Index heavyweight Reliance Industries (RIL) fell 1.27% to Rs 764.45, off the day's high of Rs 781.80. RIL has bought back 4.26 crore shares for about of Rs 3079.55 crore till 12 November 2012 under its ongoing share buyback program. RIL has set maximum buyback price of Rs 870 per share. The company has set aside Rs 10440 crore for share buyback. The buyback program opened on 1 February 2012 and closes on 19 January 2013. Auto stocks rose on hopes of likely higher sales this month to be propelled by last week's festive Diwali season. India's largest utility vehicle maker by sales Mahindra and Mahindra (M&M) rose 3.25% to Rs 938.35. The stock hit record high of Rs 942.60 in intraday trade today, 20 November 2012. Car major Maruti Suzuki India advanced 0.33% to Rs 1,499.60. The stock hit 52-week high of Rs 1,508.40 in intraday trade today, 20 November 2012. The company early this month said its total sales jumped 85.5% to 1.03 lakh units in October 2012 over October 2011. Maruti Suzuki India said total passenger car sales surged 93.8% to 79,811 units in October 2012 over October 2011. Total domestic sales jumped 86.6% to 96,002 units and total exports rose 71.8% to 7,106 units in October 2012 over October 2011. The sharp surge in sales in October 2012 was due to base effect. Maruti's sales in October of 2011 were hit adversely due to labour unrest at the company's Manesar and Gurgaon factories in Haryana. India's largest commercial vehicle maker by sales Tata Motors gained 0.8%. Jaguar Land Rover (JLR) and China's Chery Automobile Company on Sunday, 18 November 2012, laid the foundation stone for their new manufacturing facility in the People's Republic of China. The two companies recently received formal approval from the Chinese government for their joint venture and now have a licence to manufacture Jaguar Land Rover vehicles and new models for a partnership brand in China, JLR said in a statement. The equal joint venture between the two firms will be called Chery Jaguar Land Rover Automotive Company. JLR and Chery will now accelerate plans to build a joint venture manufacturing plant in Changshu, near Shanghai, as part of a 10.9 billion RMB investment that will also include a new research and development centre and engine production facility. The project includes the creation of a new partnership brand to assemble models tailored specifically for the Chinese market, including the marketing and distribution. The joint venture will blend together the heritage and experience of luxury premium vehicle manufacturer Jaguar Land Rover with the intricate knowledge and understanding of Chinese customers evident at Chery, JLR said. The JV underlines a firm commitment from both companies to the world's largest car market for the long term future, JLR said. In addition to established vehicles, the partnership will also produce models for a domestic brand tailored specifically to local customer demand. Both companies are committed to investing heavily into product innovation and advanced technologies using a new Research and Development Centre, more details of which will be released at a later date, JLR said. The two companies plan to complete the Changshu facility in Jiangsu province during 2014. Construction of a new engine plant for production of fuel efficient engines is also part of the JV partnership agreement. The confidence of Chery's partnership with Jaguar Land Rover follows rapid expansion of the Jaguar and Land Rover brands in China, where sales rose 80 per cent in the first 10 months to October 2012. In the 2011 calendar year, Jaguar Land Rover saw sales increase more than 60 per cent, driven mainly by the Jaguar XJ and XF models, and strong demand for the fuel-efficient Range Rover Evoque. Two wheeler makers fell. Motorcycle major Bajaj Auto declined 1.39% to Rs 1,828.40. The stock had hit a record high of Rs 1,905 in intraday trade on 2 November 2012. The company on 2 November 2012 said its total sales rose 4% to 4.11 units in October 2012 over October 2011. Three-wheeler sales jumped 14% to a record 50,316 units in October 2012 over October 2011. Exports declined 4% to 1.26 lakh units in October 2012 over October 2011. Bajaj Auto's motorcycle sales rose 3% to 3.61 lakh units in October 2012 over October 2011. Bajaj Auto said its domestic motorcycle clocked record monthly sales of 2.62 lakh units in October 2012. The company also said that sales of its Discover brand of motorcycles clocked record sales of 1.55 lakh units in October 2012. Hero MotoCorp shed 0.97%. The company's total motorcycle sales rose 3.31% to Rs 5.29 lakh units in October 2012 over October 2011. Hero registered its highest ever sales for scooters in a single month in October 2012. Scooter sales crossed the 50,000 mark for the first time in the company's history. Encouraged by the strong sales of its scooters Maestro and Pleasure, the two-wheeler giant has increased its scooter production to over 60,000 units a month. Index heavyweight and cigarette maker ITC was down 0.66% to Rs 280.10, off the day's high of Rs 284.70. The Ministry of Health and Family Welfare last month notified new pictorial health warnings to be depicted on tobacco product packs which will come into effect from 1 April 2013. The Ministry of Health and Family Welfare said in a statement on 22 October 2012 that three sets of warnings each have been notified for smoking as well as smokeless forms of tobacco product packages. The well-designed health warnings and messages are part of a range of measures to communicate health risks due to tobacco use. Pictorial health warnings communicate health risks in a visible way, provoke a greater emotional response and increase the motivation of tobacco users to quit and to decrease their tobacco consumption, the ministry's statement said. Graphic warning labels have a greater impact than text-only labels and can be recognized by low-literacy audiences and children, the statement added. Shares of ITC had hit record high on 19 October 2012 after the company announced strong Q2 results during trading hours on that day. The stock had hit record high of Rs 299.20 in intraday trade on 19 October 2012. ITC's net profit jumped 21.27% to Rs 1836.42 crore on 18.65% growth in income from operations to Rs 7226.58 crore in Q2 September 2012 over Q2 September 2011. Telecom stocks dropped. Reliance Communications (down 5.23%), MTNL (down 1.91%), Tata Teleservices (Maharashtra) (down 1.18%), Idea Cellular (down 0.85%) and Bharti Airtel (down 0.18%), edged lower. Telecom Minister Kapil Sibal said on Friday, 16 November 2012, that the government intends to conduct another auction of telecom bandwidth before the current fiscal year that ends in March 2013. Sibal's comment came after an auction of bandwidth last week generated just Rs 9407 crore, a little more than a third of the government's target of Rs 28000 crore. The government had put up 144 blocks of spectrum for sale, but got bids for just 101 of them as the auction's high starting price meant there were no bidders for bandwidth in some service areas. India's first sale of 2G mobile phone airwaves by auction came after the Supreme Court ordered the cancellation of permits granted to eight carriers in a scandal-tainted process in 2008. The order comes into effect in January. Videocon Telecommunications, part of Videocon Industries, whose 2G permits are to be revoked, won airwaves in six zones. Mobile phone market leaders Bharti Airtel and the local unit of British company Vodafone, which were not required to bid in auction, won additional airwaves in one and 14 zones, respectively. Norwegian group Telenor won airwave space in six zones in the auction, retaining part of the operations it would otherwise have lost in January. Idea Cellular won airwaves in all seven zones in which it was set to lose its permits. Pharma major Lupin rose 0.96% to Rs 567.50 after the company announced today, 20 November 2012, that its subsidiary Lupin Pharmaceuticals Inc. has launched its Fenofibrate Tablets, 48 mg and 145 mg strengths in the United States. Lupin had earlier received final approval for the generic medicine from the US Food and Drug Administration (FDA). Lupin's Fenofibrate tablets are the AB rated generic equivalent of Abbott's TRICOR tablets and are indicated for Primary Hypercholesterolemia or Mixed Dyslipldemia and Severe Hypertriglyceridemia. Abbott's TRICOR Tablets, 48 mg and 145 mg had annual sales of $1.26 billion in the United States as per IMS Health, June 2012 data. Among other pharma stocks, Glenmark Pharmaceuticals (up 1.67%), Cadila Pharmaceuticals (up 0.37%), Sun Pharmaceutical Industries (up 0.26%) and GlaxoSmithKline Pharmaceuticals (up 0.15%), edged higher. Capital goods stocks extended recent losses. L&T was down 0.59% to Rs 1,549.60. The company announced during trading hours today, 20 November 2012, that its construction division has won new orders worth over Rs 2503 crore across various business segments. Among other capital goods stocks, Punj Lloyd (down 1.7%), Jindal Saw (down 1.62%), SKF India (down 1.41%), BEML (down 1.22%), Praj Industries (down 1.19%), Alstom T&D India (down 1.15%), Crompton Greaves (down 0.81%), Thermax (down 0.78%), Siemens (down 0.61%), Bhel (down 0.5%), Bharat Electronics (down 0.28%), AIA Engineering (down 0.25%) and Lakshmi Machine Works (down 0.07%), edged lower. ABB declined 0.79% to Rs 710.45. The National Stock Exchange (NSE) has decided to remove ABB from trading in the futures & options (F&O) segment. F&O contracts in ABB for new expiry months will not be issued on expiry of existing contract months, NSE said in a circular issued on Monday, 19 November 2012. The existing unexpired contracts of expiry months November 2012, December 2012 and January 2013 would continue to be available for trading till their respective expiry and new strikes would also be introduced in the existing contract months. Realty stocks reversed initial gains. Unitech (down 5.89%), D B Realty (down 5.57%), Indiabulls Real Estate (down 4.17%), HDIL (down 4.03%), Anant Raj Industries (down 3.93%), Peninsula Land (down 3.34%), DLF (down 2.44%), Oberoi Realty (down 2.35%), Sobha Developers (down 1.81%), Parsvnath Developers (down 1.56%), Prestige Estates (down 0.8%) and Godrej Properties (down 0.46%), edged lower. Most PSU OMCs fell following overnight gains in crude oil prices. HPCL (down 0.84%) and BPCL (down 0.63%), edged lower. However, Indian Oil Corporation rose 0.76%. Higher crude oil prices could increase under-recoveries of state-run oil marketing companies (PSU OMCs) on domestic sale of diesel, LPG and kerosene at controlled prices. The government has already freed pricing of petrol. US crude futures for January delivery surged 3.01% to settle at $89.28 a barrel on New York Mercantile Exchange on Monday, 19 November 2012. The oil ministry last week said that under-recovery on High Speed Diesel (HSD) applicable for 2nd fortnight of November effective 16 November 2012 remains high at Rs 9.06 per litre. In case of PDS Kerosene and Domestic LPG the under-recoveries effective for November 2012 are Rs 31.30/litre and Rs 478.50/cylinder respectively, the Ministry of Petroleum & Natural Gas said in a statement on Friday, 16 November 2012. PSU OMCs are currently (effective 16 November 2012) incurring daily under-recovery of about Rs 412 crore on the sale of Diesel, PDS Kerosene and Domestic LPG. Bank stocks were mixed. Private sector banking giant ICICI Bank rose 0.11%. ICICI Bank's net profit jumped 30% to Rs 1956 crore in Q2 September 2012 over Q2 September 2011. Net interest income jumped 35% to Rs 3371 crore and non-interest income jumped 17% to Rs 2043 crore in Q2 September 2012 over Q2 September 2011. Net interest margin improved to 3% in Q2 September 2012 from 2.61% in Q2 September 2011. Cost-to-income ratio reduced to 40.9% in Q2 September 2012 from 44.4% in Q2 September 2011. The result was announced on 26 October 2012. India's second largest private sector bank by net profit HDFC Bank rose 0.67% to Rs 652.35. The stock hit a high Rs 655 in intraday trade today, 20 November 2012, matching the record high it had hit on 13 November 2012. HDFC Bank's net profit jumped 30.06% to Rs 1559.98 crore on 24.47% growth in total income to Rs 9869.8 crore in Q2 September 2012 over Q2 September 2011. HDFC Bank announced the second quarter results on 12 October 2012. Oriental Bank of Commerce rose 1.05%. The bank's issue of subordinated Lower Tier II bonds of Rs. 10 lakh each for cash at par aggregating Rs 1000 crore with an option to retain oversubscription of upto Rs 200 crore is slated to open on November 21, 2012 and will close on November 27, 2012. The bonds have been rated AA+ by ICRA & CARE and bear coupon rate of 8.93% per annum with a tenor of 120 months. However, State Bank of India (SBI) declined 1.39%. SBI's net profit rose 30.16% to Rs 3658.14 crore on 12.21% increase in total income to Rs 32983.47 crore in Q2 September 2012 over Q2 September 2011. The result was announced during trading hours Friday, 9 November 2012. The bank's ratio of net non-performing assets to net advances stood at 2.44% as on 30 September 2012, higher than 2.22% as on 30 June 2012 and 2.04% as on 30 September 2011. The bank's ratio of gross non-performing assets (NPA) to gross advances stood at 5.15% as on 30 September 2012, higher than 4.99% as on 30 June 2012 and 4.19% as on 30 September 2011. During the quarter ended 30 September 2012, the bank made additional provisions of Rs 115 crore (net) against an account pending restructuring and against certain non performing domestic advances. The bank's provision coverage ratio as on 30 September 2012 works out to 62.78%. The bank's Capital Adequacy Ratio (CAR) as per Basel II norms stood at 12.63% as on 30 September 2012, lower than 13.14% as on 30 June 2012 and 11.40% as on 30 September 2011. Among other bank shares, Bank of India (down 2.77%), Canara Bank (down 2.53%), Punjab National Bank (down 1.87%), IDBI Bank (down 1.58%), IndusInd Bank (down 1.38%), Union Bank of India (down 1.05%), Bank of Baroda (down 0.81%) and Kotak Mahindra Bank (down 0.22%), edged lower. United Spirits clocked a highest turnover of Rs 105.72 crore on BSE. L&T Finance Holdings (Rs 92.17 crore), State Bank of India (Rs 78.25 crore), Zylog Systems (Rs 43.95 crore) and Housing Development and Infrastructure (HDIL) (Rs 36.03 crore), were the other turnover toppers on BSE in that order. L&T Finance Holdings reported highest volumes of 1.24 crore shares on BSE. Zylog Systems (64 lakh shares), Cals Refineries (60.47 lakh shares), Kingfisher Airlines (54.08 lakh shares) and SpiceJet (46.58 lakh shares), were the other volume toppers on BSE in that order. Finance minister P Chidambaram on Sunday, 18 November 2012, said in a newspaper interview that amendments to General Anti-Avoidance Rules (GAAR), the controversial law against tax avoidance, have been finalized. The finance minister said that he has finalized the amendments to the Chapter 10A of the Income Tax Act which deals with taxation of investments. On the political front, the Trinamool Congress (TMC) is planning to bring a no-confidence motion against the government in the winter session of Parliament which begins on Thursday, 22 November 2012. TMC had withdrawn support to the UPA in September this year over the big bang reforms introduced by the Centre which included a cap on subsidised LPG cylinders and 51% FDI in multi-brand retail, among others. The Congress led UPA government at the Centre has been reduced to a minority government after Trinamool Congress (TMC) withdrew support to the UPA in September 2012 Reserve Bank of India (RBI) governor D. Subbarao Friday, 16 November 2012, said inflation rate of 7.5% is still high, adding that the RBI is on alert to manage both growth and inflation. Inflation based on the wholesale price index (WPI) eased to 7.45% in October 2012 from 7.81% in September 2012, data released by the government on Wednesday, 14 November 2012, showed. Build up inflation in the current financial year so far was 4.78% compared to a build up of 5.02% in the corresponding period of the previous year, the Ministry of Commerce & Industry said in a statement. Meanwhile, the government has revised upward WPI inflation for August 2012 to 8.01% from 7.55% reported on 14 September 2012. Data released by the government Tuesday, 12 November 2012, showed that consumer price inflation inched up to 9.75% in October 2012, from 9.73% in September 2012. The Reserve Bank of India next undertakes monetary policy review on 18 December 2012, which is a mid-quarter policy review. After Second Quarter Review of Monetary Policy 2012-13 late last month, RBI kept its key policy rate viz. the repo rate unchanged at 8% citing high inflation. The central bank cut the cash reserve ratio (CRR) requirement of scheduled banks by 25 basis points to 4.25%. The reduction in the CRR is intended to pre-empt a prospective tightening of liquidity conditions, thereby keeping liquidity comfortable to support growth, RBI said on 30 October 2012. It anticipates the projected inflation trajectory which indicates a rise in inflation before easing in Q4 March 2013, RBI said. While risks to this trajectory remain, the baseline scenario suggests a reasonable likelihood of further policy easing in Q4 March 2013, RBI said. RBI said its latest policy guidance will, however, be conditioned by the evolving growth-inflation dynamic, RBI said. Although inflation has remained persistently high over the past two years, it is important to note that during the 2000s, it averaged around 5.5%, both in terms of WPI and CPI, down from its earlier trend rate of about 7.5%, RBI said last month. Given this record, the conduct of monetary policy will continue to condition and contain perception of inflation in the range of 4% to 4.5%, RBI said. This is in line with the medium-term objective of 3% inflation consistent with India's broader integration into the global economy, RBI said. The Ministry of Agriculture on Friday, 16 November 2012, said that as per reports received from various states, the sowing of rabi crops is in full swing in different parts of the country. The area covered by rabi crops has totaled 195.86 lakh hectare (lh) so far, which is lower than 223.06 lh covered by this time last year. Data released by the government on 12 November 2012 showed that India's exports declined 1.63% to $23.24 billion in October 2012. Imports rose 7.37% to 44.20 billion in October 2012. Oil imports jumped 31.61% to $14.78 billion in October 2012. Non-oil imports declined 1.73% to $29.42 billion in October 2012. The trade deficit surged to $20.96 billion in October 2012 from $17.54 billion in October 2011. The trade deficit for April-October 2012 was estimated at $110.21 billion, which was higher than the deficit of $106.80 billion April-October 2011. Finance Minister P. Chidambaram on 16 November 2012 said the government is confident of achieving its budget-deficit target. Chidambaram said early this month that the best efforts would be made to contain fiscal deficit at 5.3% during the current financial year. Chidambaram said the strategy to achieve the 5.3% fiscal deficit target would be to maximize revenue collections and control expenditure. The Finance Minister has laid out a roadmap to put the government's fiscal house in order, stressing the need to control expenses and generate more revenue as it targets fiscal deficit of 5.3% of gross domestic product this fiscal year and 4.8% next year. The fiscal deficit stood at 5.8% in the year ended 31 March 2012. Chidambaram's plan envisages bringing down the fiscal deficit to 4.2% of GDP in the fiscal year ending March 31, 2015; 3.6% in fiscal 2016 and 3% in fiscal 2017. Chidambaram also said early this month that serious efforts would be made to bridge the gap in the Current Account Deficit (CAD) which presently stood at $70.3 billion. Prime Minister Dr. Manmohan Singh on 21 September 2012 said that the time has come for hard decisions. Explaining the rationale for the hike in diesel price, capping of subsidised LPG cylinders per household per year and allowing foreign direct investment in multi-brand retail trade, Dr. Singh said that rapid growth in the economy is necessary to raise the government's revenue for financing its programmes in education, health care, housing and rural employment. Dr. Singh said that India must avoid high fiscal deficit which could cause a loss of confidence in the economy. The government braved intense political opposition and initiated economic reform measures in September 2012, by allowing 51% foreign direct investment (FDI) in multi-brand retail. The government also notified the relaxed conditions for single brand retail as well as the norms for allowing 49% investment by foreign airlines in Indian carries and permitted greater foreign investment in some sections of the broadcasting sector. The Cabinet Committee on Political Affairs (CCPA) raised price of heavily subsidised diesel by Rs 5 per liter on 13 September 2012 to balance government's fiscal deficit situation. The CCPA also restricted the supply of subsidized LPG cylinders to each consumer to six cylinders (of 14.2 kg) per annum. The Union Cabinet on 4 October 2012 approved a long-pending proposal to raise the foreign investment limit in insurance companies to 49% from 26%. It also approved a plan to open up the pension sector to overseas investors, allowing them to own stakes of up to 49% in local companies. Both the proposals viz. the increase in foreign investment ceiling in insurance sector and opening of pension sector to overseas investors will require Parliament's approval. The next general elections are to be held in India before May 2014. Assembly polls will be held in Gujarat in two phases on 13 and 17 December 2012. Counting of votes of assembly elections in Gujarat and Himachal Pradesh (HP) Pradesh will take place on the same day on 20 December 2012. Assembly polls were held in HP on 4 November 2012. European stock markets edged lower on Tuesday, 20 November 2012, driven by losses for banks after Moody's Investors Service stripped France of its triple-A debt rating, lowering it by one notch. Key benchmark indices in France and UK dropped by between 0.09% to 0.13%. Germany's DAX was up 0.26%. Moody's Investors Service on Monday lowered France's sovereign rating by one notch to Aa1, stripping the country of its coveted triple-A rating. "France's long-term economic growth outlook is negatively affected by multiple structural challenges, including its gradual, sustained loss of competitiveness and the long-standing rigidities of its labor, goods and service markets," said Moody's in a statement. The ratings agency also expressed concern over France's uncertain fiscal outlook and noted that its resilience to future euro-shock is becoming more difficult to predict. The rating outlook remains negative. Euro-zone finance ministers at an extraordinary meeting scheduled today, 20 November 2012, are expected to reach an agreement on the next disbursement of a loan to Greece, whose debt and budget troubles have rocked markets world-wide over the past few years. Asian stocks edged lower on Tuesday, 20 November 2012. Key benchmark indices in Hong Kong, Indonesia and Japan fell by between 0.02% to 0.16%. Key benchmark indices in Singapore, Taiwan and South Korea rose by between 0.23% to 0.64%. China's Shanghai Composite fell 0.4%. Foreign direct investment in China fell for the 11th time in 12 months as labor costs rose, a slowdown threatened to drag growth to a 13-year low and a territorial dispute with Japan weighed on trade. Investment dropped 0.2% in October from a year earlier to $8.31 billion, the Ministry of Commerce said in Beijing today. The Bank of Japan (BOJ) kept monetary policy steady on Tuesday, standing its ground for now in the face of calls from the country's likely next prime minister to pursue "unlimited" easing. "The BOJ will pursue powerful monetary easing continuously by keeping interest rates virtually at zero and steadily increasing the amount outstanding of its asset-buying programme," the central bank said in a statement, repeating a pledge to maintain ultra-loose monetary policy to achieve 1% inflation. The leader of the main opposition, Shinzo Abe, has put the central bank at the center of economic debate ahead of a December 16 national election that surveys show his party would win, signaling his government would put the bank under much greater pressure to ease policy. Abe has even suggested revising the Bank of Japan law. Trading in US index futures indicated that the Dow could see a flat opening on Tuesday, 20 November 2012. US stocks rallied on Monday, 19 November 2012, notching their best session in more than two months, on upbeat housing data and increasing confidence that a US budget deal would be reached. Sales of previously owned US homes unexpectedly climbed in October, data showed yesterday. Existing US home sales increased 2.1% to a 4.79 million annual rate, figures from the National Association of Realtors showed. The National Association of Home Builders/Wells Fargo index of builder confidence climbed to 46 in November from 41 the previous month. The US fiscal cliff refers to the year-end deadline for the expiration of hundreds of billions of dollars worth of tax cuts and the triggering of $109 billion in across-the-board spending cuts, if the US Congress fails to act. The US Congress created the hazardous deadline of 31 December 2012 in August 2011 when it agreed to a deficit deal as a way out of a deadlock over raising the US debt ceiling. Federal Reserve Chairman Ben Bernanke is due to deliver a speech in New York today, 20 November 2012, about economic recovery and the monetary policy.