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BluFin's business cycle indicator suggests Indian economy growing as against previous year


Financial information and content company BluFin's business cycle indicator (BCI) flattened slightly in November after a month-on-month increase for three straight months. The current score is 160.0 compared to 160.3 in October. However, the implied year-on-year growth rate continues to be positive at 2.5%, suggesting the Indian economy is growing as compared to the previous year.
The latest BCI data indicate a weak recovery from a bottomed-out business cycle, BluFin said. The weakness is primarily due to a slowdown in the consumer sectors while production of basic and intermediate economic goods continues to improve. The shallowest recovery, certainly in the last six years, and possibly the last twenty. The consoling feature is that across the world, one is witnessing similar ""recoveries"". The good news just might be that this is a basing period and that once the turnaround happens, it will be steadily sharp. In my view, a full fledged recovery in the business cycle is on the horizon,'' said Surjit Bhalla, senior advisor, BluFin.
Compared to economic trends in 2009, the current recovery appears quite slow with the implied growth rate still nowhere near the long-term average growth rate (between 1991 and 2012).

Though the BluFin BCI continues to suggest an expanding economy, the concern right now is that the recovery is too slow. A weak recovery is vulnerable to surprise shocks. Therefore it is important that, announced fiscal reforms should go through soon. This would lead to expansion in manufacturing activities,'' said Sam Thomas, director, BluFin and professor of banking and finance at the Weatherhead School of Management of Case Western Reserve University, Cleveland, Ohio.
The lack of momentum in BCI's recovery path is primarily due to a slowdown in consumer and investor demand. Boosting the confidence of these economic players would be essential in ensuring sustained economic growth,'' said Debopam Chaudhuri, vice president of research and development, BluFin.
In November, 21 out of the 42 economic indicators covered by BluFin showed some improvement over the previous month. Some of the indicators pointing to an improvement include key metals like copper, iron and aluminum which registered a rise in production numbers compared to same time last year. Also, the central government's non-plan expenditure moderated further as per the latest data.
BluFin said despite a slowdown in domestic consumption, foreign tourist revenues recorded a growth as compared to the previous year. However, domestic air traffic growth (both passengers and cargo) continued to be negative.

BluFin's business cycle indicator suggests Indian economy growing as against previous year - The Times of India
 
Moody's says India outlook stable

Global credit ratings agency Moody's said on Tuesday the outlook for India's investment grade credit rating was stable, partly thanks to high investment, sparking a jump in share prices. Moody's said that the country's Baa3 ranking was underpinned by "strong economic growth" and investment in its annual credit analysis on India.

The news pushed up the Bombay Stock Exchange's benchmark 30 leading share Sensex index by 1.34% or 248.12 points to 18,785.13 points.

Moody's cited "credit strengths which include a large, diverse economy, strong GDP growth as well as savings, and investment rates that exceed emerging market averages".

But it also pointed to constraints including "India's poor social and physical infrastructure, high government deficit and debt ratios, recurrent inflationary pressures and an uncertain operating environment".

Moody's says India outlook stable - Hindustan Times
 
Goldman Sachs upgrades India to 'overweight' Thu, Nov 29 09:27 AM IST

MUMBAI (Reuters) - Goldman Sachs raised India to 'overweight' from 'market-weight', citing growth recovery and inflation moderation ahead.

The investment bank pegged December 2013 Nifty target at 6,600 points.

"Reform initiatives and changes in government leadership this fall have created a sense of optimism among the domestic investor base for the first time in over a year, and the risk of policy missteps in 2013 has been lowered," said Goldman Sachs in a report.

The investment bank added that MSCI India's valuation was well below the 5-year average of 14.9 times, affording an attractive entry point into one of the stronger structural growth markets in the region.

Nifty ended 1.62 percent up at 5,727.45 points on Tuesday. (Reporting by Abhishek Vishnoi and Manoj Dharra; Editing by Subhranshu Sahu)
 
Ford plans to make India export hub; to ship cars to 50 countries

NEW DELHI: US car major Ford today said it will make India its export hub with plans to sell its products in more than 50 countries over a period of time.

The company, which has committed a total investment of $ 2 billion in India so far, also said 40 per cent of its engines produced in the country will be sold overseas.

"We are creating an export hub in India. Our small car Figo is exported to 35 markets around the world and our plan is to increase this to 50 markets over a period of time," Joginder Singh, who will take over as the new President and Managing Director of Ford India from December 1, told reporters here.

Ford plans to make India export hub; to ship cars to 50 countries - The Economic Times
 
Sensex closes at 19,171; highest since April 2011
Last Updated: Thursday, November 29, 2012, 17:41

Mumbai: The BSE benchmark Sensex Thursday surged by nearly 329 points to close at 19-month high of 19,170.91 on Goldman Sachs' upgrading Indian stocks and continued optimism that government will push through key economic reforms.

The Indian indices ended up as the best performer of the day in Asia-Pacific. Many market analysts have forecast that Sensex could even breach its all-time high of over 21,000 level next year.

"19,000-level has come sooner than most people expected. We would see much higher levels in the months to come," said Manish Sonthalia, VP and Fund Manager Motilal AMC-PMS.

After rising to a day's high of 19,205.33, Sensex closed with a gain of 328.83 points, or 1.75 percent, at 19,170.91, its highest since April 28, 2011.

In the 30-share Sensex, 26 stocks closed with gains led by Bajaj Auto, ICICI Bank, Tata Motors, Cipla and Sterlite. L&T, HDFC, HDFC Bank, RIL and ITC also helped cement gains.

Realty, banks, auto and capital good shares attracted good buying and their sectoral indices ended higher in the range of 1.5-3.4 percent.

Across the BSE, over 1680 stocks gained Thursday, helping the investor wealth zoom to Rs 66.74 lakh crore, up by Rs 80,000 crore in a single session.

Today is the second straight day the benchmark has gained over 300 points. Sensex soared by 305 points on Tuesday after credit rating agency Moody's kept India's outlook stable.

Brokers said investors also appeared confident that the UPA government will excel in a trial of strength over FDI in retail issue to be witnessed in Parliament next week.

The 50-share NSE index Nifty closed 97.55 points, or 1.70 percent, higher at 5,825. Nifty may clock a rise 14 percent by 2013-end, Goldman Sachs said in a report today, upgrading its recommendation on India to overweight from market-weight.

"For India, upside drivers include a recovery in growth, a decline in inflation, and the potential for continued policy reforms," Goldman Sachs said adding that with structural issues being addressed and a cyclical recovery on the horizon, the market may bounce strongly next year.

Helped by increased inflows, the rupee bounced back to 54.85 levels against the dollar up over 1 percent Thursday.

Markets have started factoring in some further announcements on fiscal reforms with the deadlock on retail FDI issue being resolved, said Dipen Shah, Head PERCENTG Research, Kotak Securities.

A smooth ending to the current month's settlement in the derivative segment and a higher global trend as optimism grew that US President Barack Obama will reach an agreement with Congress over a new budget, further influenced the sentiment, said analysts.

Meanwhile, other Asian markets, barring China which closed weak, ended with gains between 0.92-1.15 percent on overnight smart rally on Wall Street after US President Barack Obama and House Speaker John Boehner expressed optimism about a deal to solve the upercentoming "fiscal cliff".

European stocks also were quoting higher in the afternoon deals. The CAC was up by 1.18 percent, the DAX by 0.70 percent and the FTSE by 0.77 percent.

Speaking on Indian markets, Kishor P Ostwal, CMD, CNI Research said: "Nifty closed at multi-month highs as expected as it crossed resistance of 5,770... Tomorrow fresh settlement is beginning. If market opens up with gap and sustains 5,840 even for two hours, we may see 6,000 next week."

Major gainers from the Sensex pack were Bajaj Auto (5.01 percent), ICICI Bank (4.59 percent), Tata Motors (4.45 percent), Cipla (3.59 percent), Sterlite Ind (3.09 percent), HDFC (2.96 percent), HDFC Bank (2.73 percent), L&T (2.62 percent) and Tata Power (2.42 percent).

However, Hero Motocorp dropped by 1.03 percent and Infosys by 0.98 percent.

11 out of 13 sectoral indices closed with gains while only BSE-IT and BSE-Teck finished with losses. The BSE-Realty was the top gainer with a rise of 3.38 percent, followed by Bankex (2.76 percent), BSE-Auto (2.08 percent), BSE-CG (1.55 percent) and BSE-CD (1.45 percentt).
Total turnover moved up further to Rs 3,341.97 crore from the Tuesday's level of Rs 3,257.31 crore.

Sensex closes at 19,171; highest since April 2011
 
Rupee up 61 paise, ends at nearly 2-wk high of 54.84
Last Updated: Thursday, November 29, 2012, 19:40

Mumbai: Tracking a steep rise in local stocks, the rupee Thursday sharply appreciated by 61 paise, its biggest gain in two months, to end at 54.84 helped by capital inflows worth nearly USD 300 million and sustained dollar sales by exporters.

Weak dollar overseas and rising hopes of government being able to push through reforms helped rupee rise, said dealers.

At the Interbank Foreign Exchange (Forex) market, the domestic unit opened lower at 55.55 a dollar from Tuesday's close of 55.45 and immediately touched a low of 55.61 on early hesitance in stocks.

However, later it bounced back to a high of 54.76 before settling at nearly two-week high of 54.84 -- a rise of 61 paise or 1.10 percent. Previously, it had finished at 54.70 on November 15, 2012.

The 61 paise gain Thursday is the highest single-day gain after the currency registered a rise of 93 paise or 1.71 percent against the US dollar on September 21, 2012.

"Inflows from telecom sector, sentiment booster from the global markets and the expected positive developments on the FDI front helped rupee soar," said Ashtosh Raina, Head - Forex Trading, HDFC Bank.

The logjam in Parliament over FDI in retail ended Thursday with a discussion on the issue allowed with voting.

FIIs pumped in around USD 300 million (or Rs 1,580 crore) in Indian stocks, as per provisional data with bourses.

The dollar index was down by 0.22 percent against a basket of six major currencies as investors on Wednesday heard optimism from Washington about budget talks that could allow the US economy to avert tax hikes and spending cuts.

"The very important India GDP figures for July-September 2012 period will come out tomorrow. Weaker data would hamper the positive sentiments build on the hopes of new reforms," said Abhishek Goenka, Founder & CEO, India Forex Advisors.

Meanwhile, the Indian benchmark sensex Thursday zoomed by 328.83 points or 1.75 percent to end at a 19-month high of 19,170.91 after Goldman Sachs upgraded its recommendation on India to overweight from market-weight.

Pramit Brahmbhatt, CEO, Alpari Financial Services (India) said: "The rupee appreciated sharply tracking easing of political logjam and positive global market cues supported by the rising optimism that the US senate and Whitehouse will come up with budget deal avoiding the fiscal cliff.

"The Euro and GBP strengthened against dollar on risk on sentiments in global markets."

The premium for the forward dollar ended narrowly mixed.

The benchmark six-month forward dollar premium payable in May eased to 164-166 paise from last close of 165-167 paise.

However, Far-forward contracts maturing in November edged up to 308-310 paise from 307-309 paise.

The RBI has fixed the reference rate for the US dollar at 55.2020 and for euro at 71.4700.

The rupee shot up further against the pound sterling to 87.85 from previous close of 88.83 and also hardened against the euro to 71.24 from 71.78.

It remained strong against the Japanese yen to end at 66.81 per 100 yen from Tuesday's close of 67.58.

http://zeenews.india.com/business/n...-ends-at-nearly-2-wk-high-of-54-84_65366.html
 
India's Q2 GDP growth falls to 5.3%

Last updated on: November 30, 2012 15:20 IST

The Indian economy grew by 5.3 per cent in the July-September period of the current financial year (2012-13), pulled down by poor performance of manufacturing and agriculture sectors, showing persistent signs of slowdown.

The gross domestic product (GDP) had expanded by 6.7 per cent in the same period of last fiscal.

It had grown by 5.5 per cent in the first quarter (April-June) of 2012-13.

During the three-month period ended September 30, the manufacturing sector grew marginally by 0.8 per cent, against 2.9 per cent growth in the same period of 2011-12, according to data released by the Central Statistical Organisation (CSO) on Friday.

Farm sector output expanded by just 1.2 per cent in the July-September period this fiscal against 3.1 per cent in the same period last year.

Mining and quarrying sector, however, showed some improvement and recorded a growth of 1.9 per cent during the quarter, as against a contraction of 5.4 per cent in the second quarter of 2011-12.

The economic growth in the first six month of this fiscal (April-September) is 5.4 per cent, lower than 7.3 per cent growth clocked in the year-ago period.

In the July-September quarter, trade, hotels, transport and communications segment also witnessed lower pace of growth at 5.5 per cent compared to 9.5 per cent expansion in the same quarter in year ago.

The growth rate of electricity, gas and water supply also dipped to 3.4 per cent in the second quarter, from 9.8 per cent witnessed in the same quarter of 2011-12.

Construction sector expanded by 6.7 per cent Q2 of 2012-13, as against 6.3 per cent in the year-ago period.

Growth rate of services sector, including insurance and real estate, stood at 9.4 per cent in the second quarter, against 9.9 per cent recorded in same quarter last fiscal.

Finance Minister P Chidambaram had earlier said that the economy faces a "difficult situation" and the way to overcome this difficult situation is through innovation and increasing the production of goods and services.

Terming the second quarter economic growth rate of 5.3 per cent as "below expectations", Finance Minister P Chidambaram on Friday said it was mainly due to scanty rainfall and poor showing by the manufacturing sector.

"Overall, the growth rate is below our expectations," Chidambaram said in a statement after the official data showed that GDP growth fell to 5.3 per cent in July-September period.

The gross domestic product (GDP) had expanded by 6.7 per cent in the same period of last fiscal. In the April-June period of 2012-13, the economic growth rate was 5.5 per cent.

During the three-month period ended September 30 this year, farm sector output expanded by just 1.2 per cent, against 3.1 per cent in the same period last year.

"The reduction in growth in agriculture and allied sectors has been on account of rainfall being lower than normal, particularly in June-July. The impact on the khariff crop has pulled down the growth rate," Chidambaram said.

He said the industry growth has been lower mainly due to poor show by manufacturing, which grew marginally by 0.8 per cent, against 2.9 per cent in the same period of 2011-12.

Growth rate of services sector, including insurance and real estate, stood at 9.4 per cent in the second quarter, against 9.9 per cent recorded in same quarter last fiscal.

"The growth rate of services sector showed some improvement in Q2 of 2012-13 vis-a-vis the Q1, it still remains below the trend level," Chidambaram said.

The economic growth in the first six months (April- September) of this financial year (2012-13) is 5.4 per cent, lower than 7.3 per cent clocked in the year-ago period.

India's Q2 GDP growth falls to 5.3% - Rediff.com Business
 
^^^^^^^^^^^^^^^

Real sector growth is less than 2% (mfg,mining,agro etc) while insurance and real estate growth is 9% which will eventually lead india to bankruptcy.
 
Plaza Hotel in New York sold to Indian billionaire

Indian billionaire Subrata Roy has bought the luxury Plaza Hotel at the corner of Central Park in Manhattan.

Mr Roy's Sahara group, known for its sponsorship of Indian cricket and motor sports, paid the US-Israeli retailer El Ad $575m (£360m) for its 75% stake.

The remaining 25% of the hotel is being retained by its current owner, Prince Alwaleed bin Talal of Saudi Arabia, via his Kingdom Holding group.

BBC News - Plaza Hotel in New York sold to Indian billionaire
 
Business Line : Industry & Economy News : Core industries post 6.5% growth in October

New Delhi, Nov 30:
Eight core industries’ output grew 6.5 per cent in October on the back of double digit growth in output of coal and petroleum refinery products.This overall performance is much better than the 0.4 per cent increase recorded in October last year and five per cent increase in September 2012.

This has raised hopes that the IIP numbers for October, which are expected around mid-December, will be much better than the 0.4 per cent contraction seen in September.The eight core industries – coal, crude oil, natural gas, petroleum refinery products, steel, cement and electricity – have a weightage of 37.90 per cent in the index of industrial production.For the April-October 2012 period, the cumulative growth rate stood at 3.7 per cent, lower than the 4.3 per cent growth seen in same period last year, official data released on Friday showed.

The growth spike in October is largely attributed to the robust output growth in coal (10.9 per cent) and petroleum refinery products (20.3 per cent).Both crude oil and natural gas production declined in October on a year-on-year basis.While steel production grew 5.9 per cent in October, fertiliser production saw growth of two per cent for the month under review.In October 2011, steel output grew 4.2 per cent and fertilisers output declined 2.1 per cent.Electricity generation grew 5.2 per cent in October, lower than the 5.3 per cent growth recorded in the same month last year.
 
Business Line : Markets News : FII secondary market investments top Rs 1 lakh crore so far in 2012

Mumbai, Nov. 30:

Secondary market investments in India by foreign institutional investors (FIIs) have crossed Rs 1 lakh crore so far this calendar year. Adding today’s purchases of Rs 1,165 crore (provisional data), FIIs bought equities worth Rs 1,01,315.83 crore in the secondary market alone.Together with primary market investments, FIIs have pumped in Rs 1.04 lakh crore so far in 2012.

Yet, the rupee remained weak against the dollar. Though the rupee appreciated during the day to close at 55.28, it recorded its life-time low of 57.37 in June.In the first eleven months of 2012, February and September witnessed a maximum equity infusion by FIIs. Although the year saw no major fundamental change and even as most market participants accused the Government for doing nothing on the policy front, foreign institutions kept pumping money into the equity market due to ‘easy’ global money, said analysts. The Sensex and Nifty gained about 25 per cent in 2012. However, mid- and small-cap indices were the star performers, as much of the money flowed into that space.

“Foreign inflows have been good in the equity market because global as well as domestic cues have been positive. There seems to be some sort of positive policy movement now. The decision on foreign direct investment in multi-brand retail is expected soon. It gives a feeling that the Government is actually pushing for reforms,” said Madhumita Ghosh, Head of Research, Unicon Financial Intermediaries
 
Indian Stocks Advance for a Fifth Day; Automakers Lead Gains - Businessweek

Indian (SENSEX) stocks rose for a fifth day, after posting their biggest weekly gain in almost six months last week. Automakers advanced after November sales for some companies increased.

The BSE India Sensitive Index, or Sensex, climbed 0.3 percent to 19,396.09 at 9:40 a.m. in Mumbai, adding to last week’s 4.5 percent gain. Mahindra & Mahindra Ltd. (MM), India’s largest maker of sport-utility vehicles and tractors, jumped 1.4 percent after November sales rose 18 percent. Maruti Suzuki India Ltd. (MSIL), the biggest carmaker, climbed for the first time in three days after reporting a 12.5 percent increase in sales.

The Sensex climbed to a 19-month high on Nov. 30 as data showing economic expansion slowed last quarter to match a three- year low stoked speculation the government will introduce more policy measures to boost growth and investment. A finance ministry official said the same day that India had raised the limit for foreign investors to buy sovereign debt and company bonds in a bid to attract inflows and bolster the rupee.

The Sensex has climbed 26 percent this year, driven by foreign flows and policy measures announced since September. Overseas investors bought $360 million more stocks than they sold on Nov. 29, the most in eight weeks, regulatory data show. They’ve purchased a net $19.8 billion of local shares in 2012, the highest among 10 Asian markets tracked by Bloomberg, excluding China, the data show.

Prime Minister Manmohan Singh began a campaign in September to revive economic growth from the weakest levels since 2009 and avoid a credit-rating downgrade by paring fuel subsidies and opening up retailing and aviation sectors to foreign investment.

Goldman Sachs Group Inc. raised its recommendation on Indian equities to overweight from market-weight, citing the prospect of stronger economic growth, lower inflation and continued policy reforms, according to a Nov. 29 report.


India’s gross domestic product grew 5.3 percent in the three months to Sept. 30 from a year ago, in line with the median of 42 estimates in a Bloomberg survey and down from 5.5 percent in the previous quarter, the government said on Nov. 30.
 
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