New Sustainability Index from S&P BSE expected in 2017-18 -The Total Investment & Insurance Solutions

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26 May 2017

Asia Index Pvt Ltd, a joint venture between S&P Dow Jones Indices LLC and BSE Ltd, is planning to introduce a new Sustainability Index in India aiming to capture holistic sustainability parameters, a top company official said here on Friday. The Total Investment & Insurance Solutions

According to the official, the new index is expected in the current fiscal. S&P BSE Indices have two sustainability indices -- S&P BSE Carbonex and S&P BSE Greenex -- which are environment-oriented and remained as "non-movers". The Total Investment & Insurance Solutions

"We are already working toward introducing a new sustainability index that will try to capture holistic sustainability parameters. We are working with our partners and hope it could be out by this year," the index provider's Business Head Koel Ghosh said.

She said the index provider is waiting for data from RobecoSAM, an investment specialist focused exclusively on sustainability investing. The Total Investment & Insurance Solutions

"They are currently capturing sustainability data from BSE 100 companies and once they come out with data, we will create the index on the basis of that data," Ghosh said. 

"The two existing sustainability indices were created in 2012. They are non movers. Apart from carbon and green house gas emissions, there are other parameters in the sustainability category. The new index will capture more parameters in the sustainability space," Ghosh added.

She, however, said gradually passive investments have been gaining popularity through index based products. Assets under management for equity exchange-traded funds (ETFs) amounted to Rs 27,203 crore as of December 2016-35 times higher than it was three years ago.

An ETF holds assets such as stocks, commodities, or bonds. It trades on the stock exchange like any ordinary stock over the course of the trading day. Most ETFs track an index, such as a stock index or bond index.The Total Investment & Insurance Solutions

UGC orders special audit in 10 central varsities-The Total Investment & Insurance Solutions

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26 May 2017

The University Grants Commission (UGC) has directed special audit in 10 central universities in the country to check complaints of financial, administrative, and academic irregularities, officials said on Friday. The Total Investment & Insurance Solutions

The UGC order follows a Ministry of Human Resource Development (MHRD) directive, a top Tripura (Central) University official said on the condition of anonymity.

"The Tripura varsity has already notified the UGC decision to all its 41 departments and eight centres and asked officials concerned to be prepared for the special audit," the official added.

The audit will also be conducted at the Aligarh Muslim University and Allahabad University in Uttar Pradesh, Pondicherry University, Hemwati Nandan Bahuguna Garhwal University in Uttarakhand, Central University of Jharkhand, Central University of Rajasthan, Central University of Jammu, Mahatma Gandhi Antarrashtriya Hindi Vishwavidyalaya in Wardha in Maharashtra, and Hari Singh Gour University in Madhya Pradesh.

Meanwhile, the Tripura assembly unanimously adopted a resolution on Thursday to urge the Ministry of HUman Resource Development for action on complaints of various irregularities in the Tripura (Central) University. The Total Investment & Insurance Solutions

Trinamool Congress key leader and legislator Sudip Roy Barman moved the resolution requesting the ministry to send a high-level team to probe the misdeeds of the Tripura University. The Total Investment & Insurance Solutions

Education Minister Tapan Chakraborty, and Congress and treasury bench members supported the resolution before it was accepted by Deputy Speaker Pabitra Kar.

Teaching and non-teaching staff of the Tripura (Central) University have been agitating for several months against alleged irregularities.

"There have been irregularities in the recruitment of professors, assistant and associate professors, promotions, admissions, construction and purchase of materials in the university," Salim Shah, a spokesperson for professors and the teaching staff, told the media here.

He said the varsity spent Rs 10 crore on purchase of e-books from select few publishers without floating tender and without consultation/requisition from academic departments concerned.

Tripura (Central) University Vice Chancellor Anjan Kumar Ghosh was not available for comments and other senior varisty officials refused to comment. The Total Investment & Insurance Solutions

US Growth In Q1 Revised Up To 1.2 Pct. But Still Weak-The Total Investment & Insurance Solutions

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26 May 2017

U.S. economy (The Total Investment & Insurance Solutions)

The U.S. economy started 2017 out with a whimper, but it wasn't quite as weak as first thought. The government revised up its January-March growth reading to a rate of 1.2 percent — better than an earlier estimate of 0.7 percent but well below President Donald Trump's ambitious growth targets.

Growth in the gross domestic product, the broadest measure of economic health, is down from a 2.1 percent annual growth rate in the fourth quarter and marks the weakest result in a year, the Commerce Department reported Friday. The Total Investment & Insurance Solutions

The upgrade to 1.2 percent reflected new-found strength in consumer spending, business investment and state and local government spending. The Total Investment & Insurance Solutions

Many economists believe growth in the current April-June quarter will rebound sharply to above 3 percent, helped by stronger consumer spending that reflects solid employment gains and an unemployment rate that has fallen to a decade low of 4.4 percent. Moreover, part of the first quarter weakness reflected various temporary factors such as unusually warm winter weather.

Paul Ashworth, chief U.S. economist at Capital Economics, said even with the upward revision it "doesn't alter the fact that it was another disappointing start to the year."

But he and other analysts said they were still looking for a better showing in the current quarter.

"Growth is bouncing back in the second quarter," said Gus Faucher, chief economist at PNC. "Consumer spending continues to expand with job and wage gains, and business investment is picking up, especially for energy-related industries." The Total Investment & Insurance Solutions

However, after a spring surge, analysts believe growth will fall back to a level of 2 percent to 2.5 percent in the second half of the year — the same modest pace that has been in effect for the almost eight years of this economic recovery, making it the slowest expansion in the post-World War II period.

During the campaign, Trump attacked the economy's weak growth and blamed it on failed economic policies of the Obama administration. He vowed that his economic program of tax cuts, deregulation and tougher enforcement of trade agreements would double growth to 4 percent or better.

Trump released his first budget on Tuesday, a $4.1 trillion spending plan that counts on faster growth to trim deficits by $2 trillion over the next decade. Many private economists believe Trump's budget is far too optimistic about how fast the U.S. economy can grow, given an aging workforce and stubbornly low productivity gains. The Total Investment & Insurance Solutions

The economy grew 1.6 percent for all of last year, the poorest showing in five years. With Trump's legislative program running into obstacles in Congress, forecasters have been trimming their growth numbers for the second half of this year and pushing any gains from Trump's tax cuts into 2018.

The revision for the first quarter reflected a boost in consumer spending to an annual rate of 0.6 percent, still the slowest in seven years but up from an initial estimate of 0.3 percent. Analysts believe that consumer spending should expand in the current quarter, helped in part by the tendency of consumers to spend more during periods of rising stock prices and home values because their net worth is increasing.

The latest result was also driven by lower declines in spending by state and local governments than initially thought and stronger investment by businesses in structures and intellectual property.

The report on GDP represented the government's second of three estimates of GDP performance in the first quarter.The Total Investment & Insurance Solutions

World Stocks Dip, Oil Price Stabilizes After Big Slide-The Total Investment & Insurance Solutions

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26 May 2017

World stock (The Total Investment & Insurance Solutions)

World stock markets mostly weakened Friday as investors watched the G-7 summit of leaders and oil prices stabilized after falling sharply over a production cut deal.

KEEPING SCORE: In Europe, France's CAC 40 was down 0.7 percent to 5,301 and Germany's DAX lost 0.5 percent to 12,562. Britain's FTSE 100 rose 0.2 percent to 7,529. Wall Street was poised to open lower, with Dow and S&P 500 futures both slipping 0.1 percent.

WORLD LEADERS: President Donald Trump and other leaders of the Group of Seven wealthy nations are meeting in Italy. The leaders, who once found broad agreement but are now increasingly divided, will be looking to build trust among themselves as they try to find common ground on issues including climate change, trade and the global economy. The Total Investment & Insurance Solutions

QUOTEWORTHY: "The G-7 summit that is starting today is unlikely to bring a much brighter outlook in terms of U.S. policy. As Trump meets with the other world leaders, differences remain large," Bas van Gaffen of Rabobank said in a commentary. "Indeed, Trump's protectionist tone doesn't appear to be weakening." The Total Investment & Insurance Solutions

CRUDE CUT: Oil prices bottomed out after a sharp selloff triggered by a deal by an alliance of oil-producing nations to extend production cuts for nine months to shore up crude prices. The deal was widely expected by analysts, but disappointed investors who were hoping for a longer extension. Benchmark U.S. crude lost rose 14 cents to $49.04 a barrel in electronic trading on the New York Mercantile Exchange. The contract shed $2.46, or 4.8 percent, on Thursday. Brent crude, the international standard, rose 21 cents to $51.67 a barrel in London.

JAPAN PRICES: Inflation ticked up to a two-year high last month on rising energy costs, according to the latest official data. The figures offer some hope that people in Asia's second-largest economy might be spurred to start spending more as growth recovers although economists say the consumer price index's 0.3 percent increase is not likely to rise further. The Total Investment & Insurance Solutions

ASIA'S DAY: Japan's benchmark Nikkei 225 index shed 0.6 percent to 19,686.84 but South Korea's Kospi climbed 0.5 percent to 2,355.30. Hong Kong's Hang Seng was nearly unchanged at 25,639.27 and the Shanghai Composite index in mainland China climbed ended less than 0.1 percent higher at 3,110.06. Australia's S&P/ASX 200 lost 0.7 percent to 5,751.50. Taiwan's benchmark fell and indexes in Southeast Asia were mostly lower. The Total Investment & Insurance Solutions

CURRENCIES: The dollar dipped to 110.89 yen from 111.84 yen in late Thursday trading. The euro rose to $1.1219 from $1.1209. The Total Investment & Insurance Solutions

Nifty, Sensex on a rally mode again – Thursday closing report -The Total Investment & Insurance Solutions

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25 May 2017

I had mentioned in Wednesday’s closing report that Nifty might find support at 9,400. The major indices of the Indian stock markets rallied on Thursday and closed with gains of around 1.50% over Wednesday’s close. The trends of the major indices in the course of Thursday’s trading are given in the table below:The Total Investment & Insurance Solutions

 

Major Indices (The Total Investment & Insurance Solutions)

The Indian equity markets on Thursday traded with gains on the back of positive global cues, a strong rupee and healthy buying in capital goods, banking and IT (information technology) stocks. The key indices traded with substantial gains on the day of expiry of May futures and options (F&O) contracts. Equity benchmark indices started off the last trading session of the current month expiry on a firm note, tracking positive global cues and appreciation of the rupee against the US dollar. Both the indices witnessed some recovery in early trades. Banking stocks are currently witnessing strong buying support with shares of SBI (State Bank of India), Yes Bank and ICICI Bank trading with over 1% intra-day gains. IT, auto and realty sector stocks are currently supporting the recovery in Indian equity markets, pointed out market analysts. On the NSE, there were 1,124 advances, 320 declines and 68 unchanged. The BSE market breadth was bullish -- with 1,878 advances and 804 declines. The Total Investment & Insurance Solutions

China will increase imports from the US in wide-ranging areas including agricultural products, energy and high-tech equipment, the Ministry of Commerce (MOC) said on Thursday. In a research report on China-US Economic and Trade Relations, the MOC noted the growth potential in US exports as China's total imports are expected to reach $8 trillion in the coming five years, which will bring more opportunities for US companies, Xinhua news agency reported. South Korea's central bank on Thursday froze its benchmark interest rate at the record-low level of 1.25% in its first rate-setting meeting under the new government. Bank of Korea (BOK) Governor Lee Ju-yeol and six other policy board members decided to keep the seven-day repurchase rate on hold at an all-time low of 1.25%, Xinhua news agency reported. 

Adani Ports and Special Economic Zone (APSEZ) on Wednesday reported an increase of 27% in its consolidated net profit for the fourth quarter (Q4) of 2016-17. According to the company, its consolidated net profit during the quarter under review increased to Rs1,179 crore from Rs928 crore in the corresponding period of 2015-16. APSEZ's consolidated revenue during the quarter under review rose by 18% to Rs2,231 crore. "This is one of our best all round performance. Our strategy to diversify our cargo mix and focus on high value cargo continues to yield positive results," said Karan Adani, Chief Executive Officer and Whole Time Director of APSEZ.  On a full financial year 2016-17 basis, Asian Paints reported a 35% increase in its consolidated net profit to Rs3,920 crore from Rs2,914 crore in 2015-16. The company's consolidated group revenue during the fiscal under review increased by 19% to Rs8,439 crore.  The company’s shares closed at Rs340.75, up 0.21% on the BSE.

Electric vehicles (EV) manufacturer Mahindra Electric on Wednesday unveiled its comprehensive technology and product road map -- EV 2.0 -- under which it plans to ramp up manufacturing and charging infrastructure. According to the company, under EV 2.0 it will make investments to develop new, high-end electric powertrains, motor controllers, systems integration and battery technology. The company which is a part of $17.8 billion Mahindra Group, had acquired the Bengaluru based Reva Electric Car Company in 2010. Mahindra & Mahindra closed at Rs1,334.70, up 2.08% on the BSE.

The GST regime will be a game changer for real estate sector and the 12% GST on construction projects meant for sale to buyers will boost the sector, National Real Estate Development Council (NAREDCO) said on Wednesday. "The GST will be a game changer for industry, including for real estate sector, since it will subsume more than 16 major taxes and levies into a single consolidated tax," NAREDCO President Parveen Jain said.  Additionally, he said, the unified tax regime will stop the unwanted practice of double taxation, which hurt real estate and other sectors, given their cascading effect which inflated prices for end-users. The S & P BSE Realty Index closed at 1,967.65, up 2.01% on the BSE.

Shares of pharma major Lupin hit a 33-month low on Thursday after plunging nearly 10% on reports that the company has received six USFDA Form 483 observations for its Indore plant.  The plant was inspected by the US drug regulator between May 8 and May 19. Lupin shares closed at Rs1,137.95, down 7.31% on the BSE. The Total Investment & Insurance Solutions

The top gainers and top losers of the major indices are given in the table below:

 

Top Gainer (The Total Investment & Insurance Solutions)

The closing values of the major Asian indices are given in the table below: The Total Investment & Insurance Solutions

Asian Indices (The Total Investment & Insurance Solutions)

2016-17: Record for rural roads, but under 50% of targeted habitations reached -The Total Investment & Insurance Solutions

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25 May 2017

On May 22, the Bharatiya Janata Party (BJP) tweeted it had ratcheted the pace of rural road construction under the Pradhan Mantri Gram Sadak Yojana (PMGSY) to 133 km a day over the three years to 2016-17, up from 69.35 km a day in 2013-14. The Total Investment & Insurance Solutions

However, compared with the Narendra Modi government's own performance in the first two years, the pace of rural road construction has slackened, connecting, up to January 2017, less than half (46 per cent) of the habitations targeted under PMGSY-I in 2016-17, an IndiaSpend analysis of Rural Development Ministry data shows. The Total Investment & Insurance Solutions

In its manifesto, the BJP had made three major promises on roads: It would connect tribal hamlets with all-weather roads, improve village-level road infrastructure, and connect ports with roads to the hinterland. While standalone data on roads connecting tribal hamlets are not available, on roads connecting ports to the hinterland, consolidated numbers are available only up to 2013.

In case of rural roads, for which data are available, the pace of construction has slackened. as noted above. Less than half of the habitations targeted under PMGSY-I for 2016-17 had been connected by January 2017. The length of roads built as a share of the government's target has also dropped from 167 per cent in 2014-15 and 108 per centin 2015-16 to 73 per cent in 2016-17, according to IndiaSpend's analysis of data available up to January 2017. The Total Investment & Insurance Solutions

PMGSY-I aims to build all-weather roads to habitations with a population of at least 500 in plain areas and at least 250 in "special" areas such as hills or tribal hamlets and located at least 500m (1.5 km of path distance in case of hills) from an all-weather road or a connected habitation.

The good news is that under Modi, allocation to the rural roads scheme has risen back to the Rs 19,000-crore peak seen under Manmohan Singh's prime ministership -- it had subsequently dropped to Rs 9,000 crore during the Congress-led United Progressive Alliance's second term -- an analysis by the Centre for Policy Research (CPR) shows. The Total Investment & Insurance Solutions

The time taken to complete a project after sanction under PMGSY has also fallen progressively by 74 per cent to 124 days under Modi, from 474 days under UPA-II's final year 2013-14, according to CPR's analysis. Compared with Modi's first year, the time taken has fallen by 67 per cent in 2016-17, from 374 days in 2014-15. The Total Investment & Insurance Solutions

In 2016-17, the pace of construction of national highways has also dropped to 44 per cent, the lowest in this government's three-year rule. This year has seen an average rate of highway construction of 22 km a day, according to information provided to the Rajya Sabha in April 2017.

The government had initially set a target of building 40 km a day. Roads and Transport Minister Nitin Gadkari claimed at an Aaj Tak Editors Roundtable on May 21, that targets had been intentionally set higher than feasible to "push the bar higher".The Total Investment & Insurance Solutions

Jio battle: Airtel urges DoT to reject TRAI's Rs 3,050 cr fine on 3 telcos -The Total Investment & Insurance Solutions

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25 May 2017

Sticking to its earlier stand, the Indian telecom regulator on Wednesday recommended penal action against three operators -- Bharti Airtel, Vodafone India and Idea Cellular -- for not providing adequate points of interconnections (PoI) to newcomer Reliance Jio.

The amount of penalty the three collectively have to pay is Rs 3050 crore. 

In similarly worded decisions against the three operators, the Telecom Regulatory Authority of India (TRAI) said it "considered it appropriate to recommend penal action... in view of the large public interest involved." The Total Investment & Insurance Solutions

An Airtel spokesperson said that the company disagreed with TRAI's recommendation and requested the Department of Telecom (DoT) to reject it. The Total Investment & Insurance Solutions

"The penalty has been recommended on the basis of an incorrect assessment of the situation on the ground," the spokesman said in a statement. The Total Investment & Insurance Solutions

Airtel requested the Department of Telecom (DoT) to reject the recommendations and "take into consideration the actions taken on ground by Bharti Airtel". It said "the fact is that we have provided PoIs to Jio at an unprecedented pace despite the provision of 90 days in the licence". 

The regulator, in response to queries by the DoT, said that its earlier penalty imposed on the three companies on the basis of licence service areas (LSA) were being confirmed. It had proposed penalties of Rs 1,050 crore each on Airtel and Vodafone and Rs 950 crore on Idea for 21 and 19 licence service areas.

TRAI said under the rules it is not prevented from exercising its mandate to make recommendations to the government for wilful non-compliance of terms and conditions of license. 

The sector regulator in October said the top three telecom operators in the country had violated licence norms by denying adequate PoI to Jio. The Total Investment & Insurance Solutions

The TRAI said Department of Telecommunications (DoT) may appreciate the fact that Airtel, Vodafone and Idea were "intentionally denying and delaying the provision/augmentation of PoIs to RJIL (Reliance Jio Infocomm), only to restrict a new entrant, thus violating the terms and conditions of licence and regulations/directions of the Authority, which also caused a lot of inconvenience to consumers."

It added that after its intervention the incumbent players have provided PoI capacity at much shorter notices (in some seven instances within 2-3 days), which implies "that it was capable of providing such POIs" without delay. The Total Investment & Insurance Solutions

"In this context, the denial and delay in providing PoIs when the quality of service (QoS) parameters were not being met cannot be explained in any other manner but wilful."

It said there was no provision in the licence or TRAI Regulation "to deny/delay provisioning of PoIs during the test phase. On the contrary, the testing cannot be completed unless sufficient PoIs are provided." The Total Investment & Insurance Solutions

TRAI said it was clear that the incumbents TSPs were not willing to provide adequate POIs to RJIL to provide a satisfactorily service to its customers on launch of its commercial service. 

The TRAI said it took into consideration the efforts made by the incumbent operators in providing sufficient number of PoIs to RJIL. The Total Investment & Insurance Solutions

"However, on finding that the incumbent operators are not willing to provide adequate POIs to RJIL as per its projections and demand, the Authority had to issue show cause notices to the telecom service providers." The Total Investment & Insurance Solutions

OPEC And Other Nations Set To Extend Output Cuts-The Total Investment & Insurance Solutions

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25 May 2017

OPEC (The Total Investment & Insurance Solutions)

OPEC and other oil nations meeting Thursday were set to extend their production cuts in an effort to shore up prices. But the intended impact could be short-lived.

That's due to U.S. shale producers. With crude prices above $50 a barrel from lows of last year, they are increasingly moving back into the market. Their output already is partially offsetting the cuts, and even more U.S. companies are poised to return if prices rise further.

The upshot is that the price of oil — and derived products like fuel —is unlikely to increase much in coming months, analysts say. That will be welcome news to consumers and energy-hungry businesses worldwide but could continue to strain the budgets of some of the more economically-troubled oil-producing nations, like Venezuela and Brazil. The Total Investment & Insurance Solutions

The latest reductions have been in effect since November, when the Organization of the Petroleum Exporting Countries agreed to cut production by 1.2 million barrels a day. Non-OPEC countries led by Russia chipped in with a further 600,000-barrel reduction.

With the deal due to expire at the end of June, one participant said the group had opted for a nine-month extension. He spoke only on condition of anonymity because he was not authorized to divulge the information prematurely. The Total Investment & Insurance Solutions

Earlier, Saudi Oil Minister Khalid A. Al-Falih spoke of a "9-month straight" extension going into the meeting. Iran's Bijan Namdar Zanganeh floated possible extensions of three months, six months or even a year and said his country had "no difficulty" with any of the options, while Jabbar Ali Hussein Al-Luiebi, his Iraqi counterpart, mentioned "the scenario of a nine-month freeze."

Al-Falih said that the cuts had managed to draw down inventories. At the same time, he said "more time is needed" to reduce oversupply. The Total Investment & Insurance Solutions

The price of oil slumped $1.03 a barrel to $50.33 in New York trading Thursday, seemingly on the realization among investors that the extension is unlikely to substantially boost prices in the longer term.

Oil prices have risen less than OPEC hoped for from last year's levels. Crude sits substantially below the highs above $100 a barrel reached in 2014, but is priced high enough to bring back into the market U.S. producers who eased back as prices tumbled last year. U.S. shale production requires a higher price to be profitable. The Total Investment & Insurance Solutions

U.S. output since last year has increased by nearly a million barrels a day to a daily 9 million barrels. That already puts American producers in the league with oil giants Saudi Arabia and Russia and cuts further into OPEC's past ability to play a role in setting prices and supplies

More than 400 oil rigs are now working U.S. shale fields — an increase of more than 120 percent compared with a year ago. And U.S. producers are poised to expand more, even if prices tick upward only moderately as a result of an oil-cut extension by OPEC and its partners.

Commerzbank cited data from the U.S. Department of Energy saying U.S. production was roughly 540,000 barrels per day higher in mid-May than at the start of the year.

"This offsets nearly half of OPEC's production cuts," it noted.

Even a decision to maintain oil cuts thus is likely to only kick the can down the road from Thursday's meeting until OPEC ministers convene again late this year. Crude prices are unlikely to rise substantially — and that means the era of windfall profits appears to be over for member nations, at least for now.

While analysts at research firm IHS Markit expect OPEC revenues to rise modestly this year after dropping from their peak of $1.2 trillion in 2012, "the total will be less than half the level of 2012, when prices were more than double current levels." The Total Investment & Insurance Solutions

Ahead of the meeting, the organization announced that Equatorial Guinea had joined, expanding OPEC membership to 14.The Total Investment & Insurance Solutions