Weekly Wrap Up: Sensex gains 64.83 pts in the week

India`s benchmark 30 share index, BSE Sensex gained 64.83 points to 20,030.83, over the week ended December 15, while the broad based NSE Nifty climbed 113.10 points to 6,047.70 in the same period.

The Sensex lost the ground after opening with gains on Monday, following the drop in global markets after UBS reported that it will write down assets attached to US subprime lending by USD 10 billion. Select stocks from capital goods, FMCG, metal, health care and power led the fall while consumer durable, realty and banking stocks gained.BSE Sensex closed with a loss of 35.32 points, or 0.18%, at 19,930.68, while the broad-based NSE Nifty closed at 5,960.60, down 13.7 points, or 0.23%.

On Tuesday, Sensex closed above 20,000 driven by continuous buying activity among the investors on speculation that another cut by the Fed will lure more investors to emerging market assets. The index opened firm at 20,049.35 and touched an intraday high of 20,333.06. Heavy buying interest was seen across board.BSE Sensex closed with a hefty gain of 360.21 points, or 1.81%, at 20,290.89, while the broad-based NSE Nifty closed at 6,097.25, up 136.65 points, or 2.29%.

Sensex closed on a firm note on Wednesday by touching an intraday high of 20,419.11 backed by sustained buying activity among the investors in index heavyweights. The index opened negative at 20,197.44 and continued to trade in the negative terrain on news of Fed cut by 25 basis points. Later the index moved up in the positive and again fell into the negative to trade on a flat note. The index touched an intraday low of 20,045.42.BSE Sensex closed with a gain of 84.98 points, or 0.42%, at 20,375.87, while the broad-based NSE Nifty closed at 6,159.30, up 62.05 points, or 1.02%.

On Thursday, Sensex opened at 20,498.11 and later slipped into the negative on back of selling activity in frontliners and global cues. The index proceeded to trade in the negative throughout the day. Profit booking was seen across board. Consequently, the index fell further and touched an intraday low of 20.065.63, to finally wrap the day on a weak note.
BSE Sensex closed with a loss of 271.48 points, or 1.33%, at 20,104.39, while the broad-based NSE Nifty closed at 6,058.10, down 101.2 points, or 1.64%.

On Friday, Sensex opened positive at 20,108.09 and later slipped into the negative on back of selling activity in frontliners and global cues. The index traded in negative throughout the day on account of profit booking which was witnessed across the board. Considerable amount of movement was seen during the day.The index fell to an intraday low of 19,936.49, to finally end the day on a sluggish note. BSE Sensex closed with a loss of 73.56 points, or 0.37%, at 20,030.83, while the broad-based NSE Nifty closed at 6,047.70, down 10.4 points, or 0.17%.

New ListingShares of Mumbai-based jewellery maker Renaissance Jewellery got listed on Wednesday at a premium of 26.67%, or at Rs 190 as against its issue price of Rs 150 a share on the Bombay Stock exchange (BSE).The company`s initial public offering received 23.63 times subscription. The company`s IPO of 5.32 million shares of Rs 10 each, was priced between Rs 125 and Rs 150 a share.

Edelweiss Capital made a sparking debut at the bourses on Wednesday.The company`s scrip got listed at 75% premium, or at Rs 1,443.75 on the Bombay Stock exchange (BSE) over its issue price of Rs 825.00 a share.The company had come out with an initial public offering (IPO) of 8,386,147 equity shares of Rs 5 each, at a price band of Rs 725 to Rs 825 a share. The issue was open for subscription from November 15 to November 20. The issue received an overwhelming response, as it was oversubscribed 110.90 times.Shares of realty major in Pune, Kolte Patil Developers (KPDL) after listing on bourses on Thursday, settled with 24.24% premium on the National Stock Exchange (NSE). It opened at a premium of Rs 85, or 58.62%, at Rs 230 as compared with the issue price of Rs 145 a share. It touched a high of Rs 230 and a low of Rs 176. Shares of Kaushalya Infrastructure Development Corporation (KIDCO), a diversified infrastructure development company, after listing on bourses on Friday, settled with 35.50% premium on the National Stock Exchange (NSE). Shares opened at a premium of Rs 19, or 31.67%, at Rs 79 as compared with the issue price of Rs 60 a share. It touched a high of Rs 84.80 and a low of Rs 59.

Corporate Highlights

Suzlon`s arm Hansen list with 42.3% premium on LSE
Suzlon Energy on Tuesday announced the listing of Hansen Transmissions International, Belgium (Hansen), the subsidiary of the company, on Dec. 11, 2007 on the London Stock Exchange.
IOC warns Indian RailwaysIndian Oil Corp (IOC) has threatened to stop fuel supplies to rail locomotives if the railways continue to insists on discounts on rates. IOC is the largest supplier of diesel to Indian Railways. IOC supplies 85% of the 2.38 million kilolitre (kl) diesel railways need annually.
TV18 acquires 53% stake in InfomediThe board of directors of Television Eighteen (TV18) India at its meeting held on Dec. 11, 2007 approved the acquisition of at least 53% stake in Infomedia India from ICICI Venture managed fund.
Television Eighteen makes open offer for 20% in InfomediaTelevision Eighteen India along with I-Ven Interactive issued a public announcement to the shareholders of Infomedia India to acquire upto 51,87,621 equity shares being 20% of the voting capital of Infomedia India at Rs 237 a share, paybale in cash.The offer opens on Feb. 04, 2008 and closes on Feb. 23, 2008.

Economy

India`s wholesale price index (WPI) based Inflation moved to 3.75% for the week ended December 01, as against 3.01% in the previous week.

Policy

Stock market regulator SEBI said that it will expand the municipal bond market in the country, that can help urban local bodies raise funds for infrastructure development.
SEBI chairman M Damodaran said there is enough liquidity in the capital market, and a few enabling provisions are needed to pull investors into long-term funds.
Municipal bonds, are issued by urban local bodies (ULBs) to finance infrastructure such as water supply and sanitation. In India, municipal bond market is 10 years old. The first bonds were issued by Ahmedabad Municipal Corporation. More ULBs should raise money from the capital market, he said.
So far there are 13 municipal bodies that have issued such bonds and in the 1999-2000 budget, the government allowed issuance of tax-free municipal bonds.
Damodaran is of the opinion, that flexibility is required in the kind of municipal bonds through which one seeks to raise money in the country as compared to standard bonds concept.

RBI issues MoI for Foreign Currency Vostro A/cs

The Reserve Bank of India (RBI) issued a memorandum of instructions (MoI) for opening and maintaining Rupee or foreign currency vostro accounts of non-resident exchanges houses.
Authorised Dealer Category –I (AD Category – I) banks are invited to the MoI for opening and maintaining such accounts.
For operations in the Rupee vostro accounts, the accounts can be used for channeling inward remittances to India primarily on private account. The remitter is permitted upto Rs 20 million per transaction and the accounts will not be used for outward remittances from India.
Separate Rupee Vostro accounts will be maintained for each arrangement and the accounts shall run on credit basis.
Also, the RBI has laid down instructions on foreign currency drawing arrangements as well as on internal control and monitoring of accounts.

Spectrum policy, also open to new comers: PM

The telecom spectrum policy should be allocated in a manner that are open to new comers to ensure the competitiveness in the sector, said Prime Minister Manmohan Singh.
He expressed concern saying that the spectrum availability can be a constrain for the growth of telecom sector in future. Also the centre has taken steps for vacating air waves by the existing users.
Singh said the key issues in the spectrum policy should be correct pricing, fair allocation rules and a pro- competitive stance. All the spectrum users to use this scare resource optimally `all technological options must be explored to maximize its utilization.`

Industrial outlook `positive`:FM

Finance Minister P Chidambaram described industrial outlook as positive, a day after official figures showed an industrial production growth of 11.8% in October 2007, as against 4.5% in the corresponding month a year ago.
According to the official figures, the industrial production during October grew by 11.8% from 4.5 % in the corresponding month last year.

However, for April-October period the growth worked out to be 9.7%, marginally lower than 10.1% recorded in the same period last year.

IRDA to consider more instruments for insurers

The Insurance Regulatory Development Authority of India (IRDA) is thinking to include mortgage-backed securities, infrastructure securities and investments in initial public offers (IPOs) in approved investments.
It is learnt that there will be certain changes in the insurance regulations that will give more flexibility to insurers without taking recourse to legislative amendment.

Investors are much inclined to infrastructure securities, as it is similar to investment requirements that offers good yields, lower defaults and are long term in nature.

IRDA to liberalize IPO investment norms for insurers

Insurance Regulatory and Development Authority (IRDA), may allow life insurers to subscribe to initial public offerings (IPO) of companies.

The insurers will be allowed to subscribe IPO of companies with a high IPO rating by a credit rating agency and the move will enable insurers to generate higher returns for their policyholders.

Global

The US Federal Reserve on Wednesday cut interest rates by a quarter percentage point to 4.25%, or 25 basis points.The cut in the federal funds rate is the third in the past three months by the world`s most powerful central bank. Fed officials signalled that further cuts were possible if the downturn in housing and the crisis in mortgage lending were to get worse.

Agri

Government announced that it had notified a new scheme extending financial assistance to sugar mills. As part of the package, the sugar mills will get interest-free loans to help them pay the dues of the farmers who supply them sugarcane.

General

Vikram Pandit has been named CEO of Citigroup, the world`s largest bank.Vikram will have to face mounting challenges at Citigroup. The bank has suffered staggering losses in recent times in the mortgage melt-down and other exposures. Shares of Citigroup dropped to below USD 30 for the first time in five years.........

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