Reliance Fixed Horizon Fund – XXVIII – Series 5 Floats On

NFO period is from 30 January to 03 February 2015

Reliance Mutual Fund has launched a new fund named as Reliance Fixed Horizon Fund – XXVIII – Series 5, a close ended income scheme with the duration of 1103 days from the date of allotment. During the New Fund Offer (NFO) the scheme will offer units at Rs 10 per unit. The new issue will be open for subscription from 30 January to 03 February 2015. 

This product is suitable for investors seeking returns and growth over the term of the fund limiting interest rate volatality by investment in debt, money market and G-sec instruments maturing on or before the date of maturity of the scheme with low risk - Blue. 

The primary investment objective of the scheme is to generate returns and growth of capital by investing in a diversified portfolio of Central, State Government securities and other fixed income/ debt securities maturing on or before the date of maturity of the scheme with the objective of limiting interest rate volatility. 

The scheme offers two options growth and dividend pay out option under Regular Plan and Direct Plan. 

The scheme will allocate upto 30% of its assets in money market instruments with low risk profile and invest 70%-100% of its assets in government securities & debt instruments with low to medium risk profile. 

The minimum application amount is Rs 5000 and in multiples of Re 1 thereafter. 

The fund seeks to collect a minimum subscription (minimum target) amount of Rs 20 crore under the scheme during the NFO period. 

Entry and exit load charge will be nil for the scheme. 

Benchmark Index for the scheme is CRISIL Short Term Bond Fund Index. 
 
The fund manager of the scheme will be Amit Tripathi. 

HDFC MF Announces Discontinuation of Dividend Reinvestment Facility

With effect from 06 February 2014

HDFC Mutual Fund has approved discontinuation of fresh subscriptions under dividend reinvestment facility option of HDFC Tax Saver and HDFC Long Term Advantage Fund, with effect from 06 February 2015. 

Consequently, no fresh subscription will be accepted under the reinvestment option of the scheme. After discontinuation of dividend reinvestment sub-option, the scheme will offer payout facility of dividend option under the regular plan and direct plan of respective scheme(s).

ICICI Prudential Fixed Maturity Plan – Series 72 – 366 Days Plan M Announces Rollover

The scheme shall mature on 27 February 2017 

ICICI Prudential Mutual Fund has proposed to roll over (extension of maturity date) ICICI Prudential Fixed Maturity Plan-Series 72-366 Days Plan M from 12 February 2015 (existing maturity date) to 27 February 2017 and the details and material terms of such roll over (extension of maturity date) are as follows: 

Purpose-The purpose of the roll over (extension of maturity date) is to continue to benefit from the prevailing yields in the fixed income market into consideration the current economic and regulatory environment. 

Period - 746 days. 

Extended Maturity Date-27 February 2017. 

Date of rollover-23 February 2015. 

Terms of roll over-Upon roll over of the scheme, certain provisions of the scheme stand modified as: 

Asset Allocation: The scheme shall invest 70-100% in debt instrument including securitized debt and up to 30% in money market instruments. 

Tenure of the scheme: The tenure of the scheme will be 746 days from the date of roll over and will mature on 27 February 2017.

ICICI Prudential Fixed Maturity Plan – Series 72 – 367 Days Plan R Announces Rollover

The scheme shall mature on 27 February 2017 

ICICI Prudential Mutual Fund has proposed to roll over (extension of maturity date) ICICI Prudential Fixed Maturity Plan-Series 72-367 Days Plan R from 20 February 2015 (existing maturity date) to 27 February 2017 and the details and material terms of such roll over (extension of maturity date) are as follows: 

Purpose-The purpose of the roll over (extension of maturity date) is to continue to benefit from the prevailing yields in the fixed income market into consideration the current economic and regulatory environment. 

Period - 736 days. 

Extended Maturity Date-27 February 2017. 

Date of rollover-23 February 2015. 

Terms of roll over-Upon roll over of the scheme, certain provisions of the scheme stand modified as: 

Asset Allocation: The scheme shall invest 70-100% in debt instrument including securitized debt and up to 30% in money market instruments. 

Tenure of the scheme: The tenure of the scheme will be 736 days from the date of roll over and will mature on 27 February 2017. 

Principal Debt Opportunities Fund Announces Change In Exit Load Structure

With effect from 30 January 2015

Principal Mutual Fund has announced change in exit load of Principal Debt Opportunities Fund-Corporate Bond Plan, with effect from 30 January 2015. 

Accordingly, if redeemed on or before 90 days from the date of allotment, the exit load charge will be 0.50%. 

If redeemed after 90 days from the date of allotment, the exit load charge will be Nil.

Tata Balanced Fund Announces Dividend

Record date for dividend is 04 February 2015 

Tata Mutual Fund has announced 04 February 2015 as the record date for declaration of dividend under the monthly dividend option of Plan A and Direct Plan of Tata Balanced Fund. 

The amount of dividend will be Rs 0.30 per unit under each plan on the face value of Rs 10 per unit.

Mutual funds step up selling

Net outflow of Rs 649.30 crore on 29 January 2015

Mutual funds sold shares worth a net Rs 649.30 crore on Thursday, 29 January 2015, compared with net outflow of Rs 337.20 crore on Wednesday, 28 January 2015. 

The net outflow of Rs 649.30 crore on 29 January 2015 was a result of gross purchases of Rs 968.70 crore and gross sales of Rs 1618.10 crore. On that day, the S&P BSE Sensex rose 122.59 points or 0.41% to settle at 29,681.77, a record closing high. 

Mutual funds have bought shares worth Rs 270.50 crore in this month so far (till 29 January 2015). Mutual funds had bought shares worth Rs 7036.90 crore in December 2014. 

Tata Fixed Maturity Plan Series 49 Scheme A (1098 Days) Floats On

NFO period is from 30 January to 11 February 2015 

Tata Mutual Fund has launched a new fund named as Tata Fixed Maturity Plan Series 49 Scheme A, a close-ended debt scheme with the duration of 1098 days from the date of allotment. The New Fund Offer (NFO) price for the scheme is Rs. 10 per unit. The new issue will be open for subscription from 30 January and close on 11 February 2015. 

The investment objective of the scheme is to generate income and / or capital appreciation by investing in wide range of fixed income instruments having maturity in line with the maturity of a scheme. 

The scheme offers growth option and periodic dividend option (payout). 

The scheme shall invest 85%-100% of assets in debt instruments with low to medium risk profile and invest upto 25% of assets in money market instruments with low risk profile. 

The minimum application amount is Rs 5000 and multiples of Re 1 thereafter. 

The fund seeks to collect a minimum subscription amount of Rs 20 crore under the scheme during the NFO period. 

Entry load: Not applicable. 

Exit load: Nil. 

Benchmark Index for the scheme is Crisil Composite Bond Fund Index. 

The fund manager for the scheme will be Amit Somani. 

Jayant Sinha, Minister of State for Finance Emphasises the Need for Innovative Product Development in an Ever Expanding Capital Market

Urges The Central Government Ministries to Maximise the Number of Members in NPS; more than 80 Lakh Subscribers Under NPS with Total Asset Under Management (AUM) of more than Rs.76,000 crores 

Shri Jayant Sinha, Minister of State for Finance emphasised the need for innovative product development in an ever expanding capital market. He stressed the aspect of empowerment and not empty entitlements as the core philosophy of the present Government. While commending Pension Fund Regulatory Development Authority (PFRDA) for putting-up a highly efficient technology platform under the NPS architecture, Shri Sinha urged the Central Government Ministries to maximise the number of members in NPS. Currently, NPS has more than 80 Lakh subscribers with total Asset Under Management (AUM) of more than Rs.76,000 crores. Shri Sinha stressed that the Government would strive to provide all possible enablers. Minister of State for Finance Shri Sinha was delivering the inaugural address at a Conference organised by the Pension Fund Regulatory and Development Authority (PFRDA) for the Central Government Ministries to discuss on the important role of the Financial Advisors & Chief Controller of Accounts (FAs/CCAs) of the Central Government Ministries in the implementation and monitoring of the National Pension System (NPS). He said that the workers in the unorganised sector through Swavalamban would be supported through the social security net. He added that NPS would effectively address the pension issues of approximately 10-12 million young work force being added on an annual basis. Addressing the issue of future course of action, Shri Sinha urged PFRDA to provide enabling framework for more products and wider coverage of the population with pension products. Further the Regulator may consider alternative investment funds like Venture Capital funds and Growth Capital Funds which are important to encourage entrepreneurship in our country, the Minister added. 

Earlier speaking on the occasion, Chairman PFRDA, Shri Hemant Contractor, commended the substantial improvement in performance of Central Government Ministries under NPS. He stated that the attractive market based returns have added to the stakeholder confidence. He raised two pertinent issues for the participating members which impact the final pension receivable by a Government subscriber which include efficiency in handling of subscriber contribution & its timely deployment for investment, and ensuring full coverage of all government subscribers including autonomous bodies. 

Shri Ratan P Watal, Secretary, Department of Expenditure, Ministry of Finance emphasised on the dual responsibility of PFRDA as a regulator and developer of the pension industry. Shri Watal stressed the process orientation of NPS and emphasised the important role of FAs/CCAs in terms of early enrolment and timely contribution, upload and redressal of subscribers' grievances. He further advised the FAs/CCAs to carry-out periodic reviews on the implementation of NPS and performance of the scheme under the above parameters specifically. 

Shri R V Verma, Whole Time Member (WTM- Finance), while summing- up emphasised the need for discipline of remitting of the subscriber contribution especially in view of the enhanced role of the Government nodal officers as envisaged in the regulations and the provisions of the Act . He sought the cooperation of Government to suggest the way forward for providing individual choices of pension funds and investment pattern for Government Subscribers. He stressed on the need for enhancing capacity building of the nodal officers so that they could in turn enable the financial literacy and awareness of the subscribers. 

New Series Estimates of National Income, Consumption Expenditure, Saving and Capital Formation (Base Year 2011-12)

The Ministry of Statistics & Programme Implementation has released the new series of national accounts, revising the base year from 2004-05 to 2011-12. The base year of national accounts was last revised in January 2010. 

Base year revisions differ from annual revisions in National Accounts primarily because of nature of changes. In annual revisions, changes are made only on the basis of updated data becoming available without making any changes in the conceptual framework or using any new data source, to ensure strict comparison over years. In case of base year revisions, apart from a shift in the reference year for measuring the real growth, conceptual changes, as recommended by the international guidelines, are incorporated. Further, statistical changes like revisions in the methodology of compilation, adoption of latest classification systems, and, inclusion of new and recent data sources are also made. Changes are also made in the presentation of estimates to improve ease of understanding for analysis and facilitate international comparability. 

Improvements as noted above, especially incorporation of new datasets, have resulted in a correction in the level of GDP, which is likely to affect a wide range of indicators where it is used as a reference point: for instance, trends in public expenditure, taxes and public sector debt that are conventionally analysed in terms of their ratios to nominal GDP. It may be noted that the level of revision in the present base revision is not large enough to affect any of these ratios significantly. 

Users are requested to note that Gross Domestic Product (GDP) at factor cost will no longer be discussed in the press releases. As is the practice internationally, industry-wise estimates will be presented as Gross Value Added (GVA) at basic prices, while ‘GDP at market prices' will henceforth be referred to as GDP. Estimates of GVA at factor cost (earlier called GDP at factor cost) can be compiled by using the estimates of GVA at basic prices and production taxes less subsidies as given in Statement 3.1 of this note. For the years 2011-12, 2012-13 and 2013-14, GVA at factor cost have been compiled and are presented in Statements 10.1 & 10.2. 

The salient features of the key macro-economic aggregates are indicated in the following paragraphs. 

Gross Domestic Product 

GDP for the base year 2011-12 is estimated as Rs. 88.3 lakh crore. Nominal GDP or GDP at current prices for the year 2012-13 is estimated as Rs. 99.9 lakh crore while that for the year 2013-14 is estimated as Rs. 113.5 lakh crore, exhibiting a growth of 13.1 percent and 13.6 percent during the years 2012-13 and 2013-14 respectively. 

Real GDP or GDP at constant (2011-12) prices stands at Rs.92.8 lakh crore and Rs.99.2 lakh crore, respectively for the years 2012-13 and 2013-14, showing growth of 5.1 percent during 2012-13, and 6.9 percent during 2013-14. 

Industry-wise Analysis 

The percentage changes in the Gross Value Added (GVA) at basic prices in different sectors of the economy are presented in Statements 4.1 and 4.2. At the aggregate level, nominal GVA at basic prices increased by 13.2 percent during 2013-14, as against 12.9 percent during 2012-13 (Statement 1.1). In terms of real GVA, i.e., GVA at constant (2011-12) basic prices, there has been a growth of 6.6 percent in 2013-14, as against growth of 4.9 percent in 2012-13. 

The growth in GVA during 2013-14 has been higher than that in 2012-13 due to higher growth in ‘trade & repair services' (14.3%), ‘communication and services related to broadcasting' (13.4%), ‘other services' (10.7%), ‘agriculture, forestry and fishing' (3.7%), ‘construction' (2.5%) and ‘public administration & defence' (4.9%). 

Net National Income 

Nominal Net National Income (NNI) for the year 2011-12 stands at Rs. 78.5 lakh crore, while the estimates for the years 2012-13 and 2013-14 are Rs. 88.4 lakh crore and Rs. 100.6 lakh crore, showing an increase of 12.7 percent and 13.7 percent during 2012-13 and 2013-14 rsepectively. 

Gross National Disposable Income 

Gross National Disposable Income (GNDI) at current prices is estimated as Rs.90.6 lakh crore for the year 2011-12, while the estimates for the years 2012-13 and 2013-14 stand at 102.2 lakh crore and Rs.116.0 lakh crore, respectively. 

Saving 

Gross Saving during 2011-12 is estimated as Rs.29.9 lakh crore, and the estimates for the years 2012-13 and 2013-14 are Rs. 31.8 lakh crore and Rs. 34.8 lakh crore respectively. Rate of Saving to GNDI for the years 2011-12, 2012-13 and 2013-14 is estimated as 33.0 percent, 31.1 percent and 30.0 percent respectively. 

The highest contributor to the Gross Saving is the household sector, with a share of 59.4 percent in the year 2013-14. However, the share has declined from 67.3 percent in 2011-12 and 63.4 percent in 2012-13. This decline can be attributed to the decline in household savings in physical assets, which has declined from Rs.13.4 lakh crore in 2011-12 to Rs. 12.1 lakh crore in 2013-14. On the other hand, the share of Non-Financial Corporations has increased from 29.3 percent in 2011-12 to 34.5 percent in 2013-14. The share of Financial Corporations has been around 9 percent in all these years, while the dis-saving of General Government has decreased from 5.4 percent in 2011-12 to 3.2 percent in 2013-14. 

Capital Formation 

Gross Capital Formation (GCF) at current and constant prices is estimated by two approaches – (i) through flow of funds, derived as Gross Saving plus net capital inflow from abroad; and (ii) by the commodity flow approach, derived by the type of assets. The estimates of GCF through the flow of funds approach are treated as the firmer estimates, and the difference between the two approaches is taken as “errors and omissions”. However, GCF by industry of use and by institutional sectors does not include “valuables”, and therefore, these estimates are lower than the estimates available from commodity flow. 

Gross Capital Formation (GCF) at current prices is estimated as Rs. 33.7 lakh crore for the year 2011-12, while the estimates for both the years 2012-13 and 2013-14 stand at Rs. 36.6 lakh crore. Since GCF did not increase during 2013-14, the rate to GDP declined during the year to 32.3 percent as against 36.6 during 2012-13. The rate of GCF to GDP excluding valuables stands at 33.9 percent and 31 percent during 2012-13 and 2013-14 respectively. The rate of capital formation in the years 2011-12 to 2013-14 has been higher than the rate of saving because of net capital inflow from Rest of the World (ROW). 

In terms of the share to the total GCF (at current prices), the highest contributor is Non-Financial Corporations, with the share rising steadily from 46.6 percent in 2011-12 to 51.5 percent in 2013-14. Share of household sector in GCF is also significant, which has declined from 42 percent in 2011-12 to 34.2 percent in 2013-14. The share of General Government in GCF has increased from 10 percent in 2011-12 to 13.2 percent in 2013-14. 

The rate of Gross Capital Formation at constant (2011-12) prices has decreased from 37.2 in 2012-13 to 33.4 in 2013-14. 

Within the Gross Capital Formation at current prices, the Gross Fixed Capital Formation (GFCF) amounted to Rs. 33.7 lakh crore in 2013-14 as against Rs. 31.4 lakh crore and Rs. 29.7 lakh crore in 2012-13 and 2011-12 respectively. The change in stocks of inventories, at current prices, decreased from Rs. 2.2 lakh crore in 2011-12 to Rs. 1.8 lakh crore in 2013-14, while the valuables decreased from Rs. 2.5 lakh crore in 2011-12 to Rs. 1.5 lakh crore in 2013-14. 

Consumption Expenditure 

Private Final Consumption Expenditure (PFCE) at current prices is estimated at Rs. 50.9 lakh crore for the base year 2011-12, increasing to Rs. 58.8 lakh crore in 2012-13 and further to Rs. 67.7 lakh crore in 2013-14. In terms of GDP, the rates of PFCE at current prices during 2011-12, 2012-13 and 2013-14 are estimated at 57.6 percent, 58.8 percent and 59.7 percent respectively. 

At constant (2011-12) prices, the PFCE is estimated at Rs. 53.7 lakh crore and Rs. 57.0 lakh crore for the years 2012-13 and 2013-14 respectively. The corresponding rates of PFCE for the years 2012-13 and 2013-14 are 57.9 percent and 57.5 percent respectively. 

Government Final Consumption Expenditure (GFCE) is estimated at Rs. 9.9 lakh crore for the year 2011-12. The estimates of GFCE at current prices for the years 2012-13 and 2013-14 stand at Rs. 10.9 lakh crore and Rs. 12.8 lakh crore, respectively. At constant (2011-12) prices, the estimates of GFCE for the years 2012-13 and 2013-14 stand at Rs. 10.0 lakh crore and Rs. 10.9 lakh crore respectively. 

Estimates at per capita level 

For the purpose of estimation of Per Capita Income and Per Capita PFCE, Population Projections compiled on the basis of Census 2011 have been used. Per Capita Income at current prices, estimated as Per Capita Net National Income at current prices, is estimated at Rs. 64316, Rs. 71593 and Rs. 80388 for the years 2011-12, 2012-13 and 2013-14 respectively. Correspondingly, Per Capita PFCE at current prices, for the years 2011-12, 2012-13 and 2013-14 is estimated as Rs. 41728, Rs. 47572 and Rs. 54133, respectively. 

The upcoming releases on GDP are indicated below: 

i. Advance Estimates for the year 2014-15 alongwith quarterly estimates for Q1, Q2 and Q3 of 2014-15 on February 9, 2015; and 

ii. Provisional Estimates for the year 2014-15 alongwith estimates for all the four quarters of the year on May 29, 2015. 

FPIs continue buying

Net inflow of Rs 1825.90 crore on 29 January 2015 

Foreign portfolio investors (FPIs) bought shares worth a net Rs 1825.90 crore on Thursday, 29 January 2015, compared with inflow of Rs 1861.02 crore during the preceding trading session on Wednesday, 28 January 2015. 

The net inflow of Rs 1825.90 crore on 29 January 2015 was a result of gross purchases of Rs 8809.92 crore and gross sales of Rs 6984.02 crore. There was a net inflow of Rs 1791.19 crore into the secondary equity market on 29 January 2015, which was a result of gross purchases of Rs 8775.21 crore and gross sales of Rs 6984.02 crore. The BSE Sensex advanced 122.59 points or 0.41% to settle at 29,681.77 on that day, a record closing high. 

There was an inflow of Rs 34.71 crore into the category 'primary market & others' on 29 January 2015. 

FPIs have bought shares worth a net Rs 12918.97 crore in this month so far (till 29 January 2015). They have bought shares worth a net Rs 12686.51 crore from the secondary markets in this month so far (till 29 January 2015). FPIs had bought shares worth a net Rs 1036.29 crore last month. They had sold shares worth a net Rs 1707.17 crore into the secondary equity market last month. 

FPIs had bought shares worth a net Rs 97055.90 crore in the calendar year 2014. They had bought shares worth a net Rs 84440.80 crore from the secondary equity markets in calendar year 2014. 

Big drop for precious metals

Gold posts its biggest daily percentage drop in 13 months 

Bullion prices ended lower at Comex on Thursday, 29 January 2015. Gold posted its biggest daily percentage drop in 13 months on Thursday as U.S. jobless claims fell sharply, bolstering the Federal Reserve's commitment to tightening monetary policy later in the year. A recovery in U.S. stocks and the greenback also tarnished gold's allure as a safe-haven asset.
Gold for February delivery skidded $31.30, or 2.4%, to settle at $1,254.60 an ounce. 

March silver futures shed $1.32, or 7.3%, to $16.77 an ounce. 

Government data showed the number of U.S. workers making first-time claims for unemployment benefits fell to 265,000 in the week ended 24 January 2015 from a revised 308,000 a week earlier. The fall was much larger than economists had expected and took initial claims to the lowest level since 2000. Economists had warned that the figures could be impacted by a reporting week shortened by the Martin Luther King Day holiday. 

Gold prices had come under pressure a day earlier after the U.S. central bank continued to imply a commitment to raising interest rates around the middle of 2015. 

The market place on Thursday was still digesting Wednesday's Federal Reserve's Open Market Committee statement that left U.S. monetary policy unchanged, saying the Fed remains “patient” on raising interest rates. However, the FOMC statement removed the “considerable time” wording regarding a timeframe for waiting to raise interest rates. Recent developments, including plunging crude oil prices, economic troubles in the European Union, currency market turmoil, and other countries moving to stimulate their monetary policies, have led many to believe the Fed might not be able to raise interest rates until late this year, or may have to wait until 2016. 

Marginal gains for crude

Prices sink below $44/barrel during intra day trading 

Crude oil futures ended with small gains on Thursday, 29 January 2015 at Nymex but only after the U.S. benchmark sank below the $44-a-barrel level for the first time in nearly six years in a trading environment shadowed by a rapidly growing glut of crude. 

Light, sweet crude for March delivery on the New York Mercantile Exchange rose 8 cents, or 0.2%, to close at $44.53 a barrel. It was a choppy trading session, with the contract earlier dipping as low as $43.58, its lowest level since March 2009. 

A day earlier, the U.S. Energy Information Administration said U.S. oil supplies rose by 8.9 million barrels in the week ended 23 January 2015, higher than the increase of around 3.5 million barrels expected by markets. At 406.7 million barrels, U.S. inventories are at their highest since 1924. 

Government data showed the number of U.S. workers making first-time claims for unemployment benefits fell to 265,000 in the week ended 24 January 2015 from a revised 308,000 a week earlier. The fall was much larger than economists had expected and took initial claims to the lowest level since 2000. Economists had warned that the figures could be impacted by a reporting week shortened by the Martin Luther King Day holiday. 

Among other energy products, heating oil for February fell 1.34 cents, or 0.8%, to $1.6184 a gallon, while gasoline for the same month rose 0.87 cents, or 0.7%, to $1.3537 a gallon.
March natural gas fell 12.3 cents, or 4.3%, to $2.719 per million British thermal units.

Bond yield eases by 02 bps

10-year G-sec Paper yield closes at 7.69% 

The yield on 10-year benchmark federal paper, 8.40% GS 2024, eased by 02 basis points to close at 7.69% compared with 7.71% close in the previous trading session. The total trading volume on central bank's gilts trading platform stood Rs 33,490 crore. 

Bond yield eased on strong rally in rate swap market. 

The weighted average rate in the overnight call money increased to 7.83% compared with 7.72% in previous session. The call money rate hovered in the range of 6.25% to 8.05% with the volume of Rs 25,861.26 crore. 

Asia Pacific Market: Stocks down ahead of US GDP, China factory data

Headline equities of the Asia Pacific market closed mostly down after wavering between positive and negative territory on Friday, 30 January 2015, as a late earnings-led surge on Wall Street overnight failed to overshadow concerns over global growth. The MSCI's broadest index of Asia-Pacific shares outside Japan edged down about 0.2%. 

Shares in regional market opened the day higher, as investment sentiment got a lift from Thursday's US gains, which saw major US indexes surging almost 1% or more as Apple Inc and Boeing Co extended gains after strong earnings reports this week. US jobless claims figures also helped bolster the mood, with the number of Americans filing new claims for unemployment benefits last week marking its biggest weekly decline since November 2012, falling to its lowest since April 2000. 

But the regional market quickly turned around, as investors rushed for profit booking on cautious ahead of fourth-quarter US gross domestic product data later on Friday and ahead of China's official data on manufacturing that due over the weekend. The China's official purchasing managers' index is due out Sunday, followed by a similar survey by HSBC on Monday 

Among regional bourses
 
Australia market gains for seventh straight session 
 
The Australian share market ended higher, registering seventh session of consecutive rise. The gains came on account of rebound in resources stocks and continued hunt for high-yielding stocks amid anticipation that the central bank will lower interest rates at next week's policy meeting. The benchmark S&P/ASX 200 Index rose 0.34% to 5588.30 and the broader All Ordinaries Index gained 0.35% to 5551.60. The benchmark S&P/ASX 200 Index and the broader All Ordinaries Index rose 1.6% and 1.5%, respectively, for the week. In the January 2015, the S&P/ASX 200 Index rose 3.3% and the All Ordinaries went up 3%. 

Financial stocks extended gains on growing speculation that the central bank could cut interest rates as early as next week. Commonwealth Bank of Australia advanced 0.6% to A$89.33, ANZ Banking Group 0.2% to A$33 and National Australia Bank 0.4% to A$35.63, while Westpac Banking Corp fell 0.5% to A$34.46 amid news it was selling its businesses in five smaller Pacific-Island nations but keeping those in Fiji and Papua New Guinea. 

Shares of materials and resources companies rebounded on bottom fishing after heavily sold in recent months as commodity prices have weakened. Among the major miners, BHP Billiton was up 1.1% to A$29.26, while Rio Tinto ended 0.9% higher at A$57.56. Fortescue Metals rebounded 5.8% to A$2.36 as both Macquarie and RBC Capital Markets issued upbeat notes about the iron-ore extractor. 

Newcrest Mining fell 1% to A$13.56 on profit taking after climbing nearly 24% over the month. On Friday, it increased full-year production guidance by 100,000 ounces to between 2.3 million and 2.5 million ounces. 

Energy stocks also ended with the gains. Woodside Petroleum added 1.6% to A$34.28, Santos gained 1.9% to A$7.88 and Oil Search rose 0.9% to A$7.77. Whitehaven Coal fell 4.6% to A$1.24 after reporting a wider half-year loss as a deepening slump in global coal prices overshadowed record sales. 

Nikkei ends modest 0.39% higher
 
Japanese share market ended higher, as risk sentiments boosted up after better than expected domestic industrial output and retail sales data for last month. Meanwhile, buying momentum underpinned further by impressive earnings reports from several bellwether firms such as Nomura Holdings and Advantest Corp. The benchmark Nikkei Stock Average advanced 0.39% to close at 17674.39, while the broader Topix has lost 0.11% to close at 1415.07. For the week, the Nikkei index added 0.9%. For the month of January, the market was up 1.3%. 

Japan's retail sales rose 0.2% year-on-year for a sixth straight month in December, following a revised 0.5% rise in November, data by the Ministry of Economy, Trade and Industry (METI) showed on Thursday. The sales data indicating an evidence of a gradual recovery in private consumption as the economy climbs out of recession. 

Also data released on Friday showed manufacturing output increased 0.3% in December from a year earlier and by 1% from the month before, suggesting the world's third-largest economy may be turning the corner on a recession brought on by a hefty sales tax hike. However, inflation moderated to 2.5% from a year earlier, compared with 2.7% in November. The core consumer price index, excluding food, fell 0.2% from the month before. Meanwhile, Japan's jobless rate dipped to 3.4% from 3.5% the month before. 

Chip testing equipment maker Advantest surged 9.3% to 1512 yen, thanks to solid third quarter numbers. The firm booked 4.7 billion yen net profit, up 43% on year, and raised its full-year guidance. 

Brokerage bellwether Nomura Holdings added 1.5% to 634.50 yen after the firm booked 3Q results showing a net profit of 70 billion yen. The firm also announced plans for a share buyback with a ceiling of 30 billion yen, or 1% of outstanding shares. 

Shinsei Bank added 5.4% to 215 yen after booking an April to December nine-month net profit of 52.36 billion yen, almost double the year-ago figure, and well ahead of estimates. It also raised its full-year guidance. 

SoftBank Corp fell 3.4% to 243 yen after Alibaba Group Holding reported lower-than-expected revenues for the third quarter. SoftBank has a 32.59% stake in Alibaba. 

China stocks tumble ahead of manufacturing PMI data
 
Mainland China share market declined for fourth consecutive session, as investment sentiment dampened by fresh investigations into stock margin trading and on caution before this weekend's manufacturing data. The Shanghai Composite Index closed down 1.6% at 3210.36, putting the market down 4.2% since last Friday, the biggest weekly decline since December 2013. 

The market was facing pressure from both the regulators, who have been cracking down on fast fund inflows into equities, and profit taking after a 37% rally in the fourth quarter. Some investors are retreating after finding the market doesn't present too many investment opportunities at this stage. 

Much of the malaise is due to concerns over the presence of high levels of leverage in the stock market. Fears of another clampdown weighed on the market for much of this week too. A news report from the official news agency Xinhua released late on Wednesday said that the securities regulator will inspect margin trading activities at 46 companies, though it said the regulator that the inspections were a normal event that "should not be over-interpreted". 

All ten SSE industry groups declined, with shares of industrial issue falling the most, down 3.6%, followed by information technology (down 2.1%), energy (down 1.7%), financial (down 1.1%), materials (down 1%), consumer discretionary (down 1%), and utilities (down 0.9%). Meanwhile, healthcare, consumer staples and telecommunication services issues all declined by 0.4%. 

Shares of financial companies, especially brokerages, continued to fall today, with Haitong Securities losing 1.8% and Founder Securities falling 2.2%. 

Stocks in the industrial sector declined the most in Beijing today ahead of official data on manufacturing that is due over the weekend. Shanghai Electric Group Co. lost 4.5% and Shanghai Mechanical & Electrical Industry Co. fell 2.6%. 

Hang Seng ends 0.36% down
 
Hong Kong share market ended down for second day in row, as investment sentiments dampened on tracking drop in Mainland A-share market and on caution ahead of China's official manufacturing data due over the weekend. The Hang Seng Index ended down 88.80 points or 0.36% to 24507.05, off an intra-day high of 24771.37 and day low of 24450.05. Turnover decreased to HK$85.13 billion from HK$89.47 billion on Thursday. 

Shares in Hong Kong market opened higher today, on tracking gains for U.S. markets overnight, but soon fell back to the flat line as a heavy fall in index heavyweight Tencent Holdings dragged on the market after New York-listed rival Alibaba Group Holding earnings undershot estimates. Meanwhile, selloff pressure intensified on tracking decline in Mainland A-share market which fell amid concern regulatory scrutiny of margin lending and on caution ahead of official data on manufacturing that is due over the weekend. 

Within HK 50 blue chips, 17 stocks rose and 31 fell, while remaining 2 stocks ended steady. Hengan International (01044) put on 3.9% to HK$92.25 after Goldman Sachs put the stock into its conviction buy list, while Galaxy Entertainment (0027) declined 3.1% to HK$40.90, making themselves the biggest blue chip winner and loser. 

Macau gaming players fell across the board as the government plans to submit a bill to the legislative council proposing a full smoking ban in casinos and all public space. Galaxy Ent (00027) dipped 3% to HK$40.9 becoming the worst blue-chip loser. Sands China (01928) fell 2.9% to HK$38.05. SJM (00800) and Wynn Macau (01128) slipped 4% and 3.6% to HK$11.44 and HK$21.65. Melco Crown (06883) declined 2.7% to HK$62.55. Melco Dev (00200) and MGM China (02282) dropped 2% to HK%15.58 and HK$18.92. 

Most of the major tech stocks declined, with Tencent retreating 1.9% to HK$132, after stock in Alibaba plunged 8.8% overnight. Alibaba's two Hong Kong-traded subsidiaries also suffered significant losses, with Alibaba Pictures Group dropping 7.2% to HK$1.54, and Alibaba Health Information Technology sliding 3.8% to HK$5.12. Online game operator IGG Inc retreated 3.4% to HK$2.85, software developer Kingsoft Corp fell 3.1% to HK$18.62, rival Kingdee International Software Group gave up 4.6% to HK$2.52 and game developer Boyaa Interactive International shed 1.3% to HK$5.38. 

Sensex, Nifty settle at over one-week low
 
Indian stocks tumbled the most in three weeks after two of the nation's largest lenders reported higher bad-debt provisions and the government sold shares in Coal India Ltd. that fetched it $3.6 billion. The S&P BSE Sensex fell 498.82 points or 1.68% to settle at 29,182.95, its lowest closing since 22 January 2015. The CNX Nifty fell 143.45 points or 1.6% to settle at 8,808.90, its lowest closing level since 22 January 2015. 

Shares of a number of PSU bank stocks dropped after a sharp post result setback in BoB counter. ICICI Bank dropped after the bank reported an increase in sticky loans in Q3 December 2014. Coal India dropped as the divestment of the government's up to 10% stake in the state-run Coal major was concluded through the stock exchanges mechanism through a single trading session today, 30 January 2015. Power equipment major Bharat Heavy Electricals (Bhel) hit 52-week high. NTPC rose after declaring Q3 result. 

HCL Technologies scaled a record high after the company's board of directors at its meeting held today, 30 January 2015 recommended a liberal 1:1 bonus issue. Power generation stocks gained on renewed buying. Realty stocks edged higher on reports the finance ministry has floated a draft cabinet note to amend the Foreign Exchange Management Act to permit overseas funds in real estate investment trusts (REITs). 

Elsewhere in the Asia Pacific region: Taiwan's Taiex index fell 0.69% to 9361.91. South Korea KOSPI sank 0.09% to 1949.26. New Zealand's NZX50 shed 0.27% at 5744. Singapore's Straits Times index was 0.81% lower at 3391.20. Indonesia's Jakarta Composite index was up 0.51% to 5289.40. Malaysia's KLCI fell 0.05% to 1781.26. 

Deutsche MF Announces Dividend Under Two Schemes

Record date for dividend is 02 February 2015 

Deutsche Mutual Fund has announced 02 February 2015 as the record date for declaration of dividend on the face value of Rs 10 per unit under the dividend option of DWS Fixed Term Fund – Series 96 and DWS Hybrid Fixed Term Fund – Series 4. The amount of dividend will be 100% of distributable surplus. 

Escorts Tax Plan Announces Discontinuation of Dividend Reinvestment Option

With effect from 01 February 2015 

Escorts Mutual Fund has approved discontinuation of fresh subscriptions under dividend reinvestment option of Escorts Tax Plan, with effect from 01 February 2015. 

Consequently, no fresh subscription will be accepted under the reinvestment option of the scheme. After discontinuation of dividend reinvestment sub-option, the scheme will offer dividend and growth option where growth option is the default option. Dividend option will have only dividend payout as the sub-option.

ICICI Prudential Interval Fund II – Quarterly Interval Plan F Announces Dividend

Record date for dividend is 03 February 2015 

ICICI Prudential Mutual Fund has announced 03 February 2015 as the record date for declaration of dividend under the dividend option of ICICI Prudential Interval Fund II- Quarterly Interval Plan F. The amount of dividend (Rs per unit) on the face value of Rs 10 per unit will be: 

Retail Dividend: 0.1850 

Regular Plan-Dividend: 0.1896 

Retail Quarterly Dividend Payout: 0.1829

JPMorgan India Short Term Income Fund Announces Change In Exit Load Structure

With effect from 01 February 2015

JPMorgan Mutual Fund has announced change in exit load structure under retail plan and direct plan of JPMorgan India Short Term Income Fund (an open-ended income scheme), with effect from 01 February 2015. 

Accordingly, if redeemed within 6 months from the date of allotment in respect of lumpsum & within 6 months from the date of allotment in respect of each purchase made through SIP and if redeemed after 6 months from the date of allotment in respect of lumpsum & after 6 months from the date of allotment in respect of each purchase made through SIP, the exit load will be Nil. 

Tata Fixed Maturity Plan Series 46 Scheme O Announces Extension of Maturity

The scheme shall now mature on 27 February 2017 

Tata Mutual Fund has announced extension of maturity of Tata Fixed Maturity Plan Series 46 Scheme O, a close ended debt fund. 

Tata Fixed Maturity Plan Series 46 Scheme O was launched on 17 February 2014. The units under the scheme were allotted on 26 February 2014 and the scheme is scheduled to mature on 26 February 2015. The trustees have decided to extend the maturity of the scheme by 732 days. The scheme shall now mature on 27 February 2017. 

Birla Sun Life Fixed Term Plan - Series EH Announces Extension of Maturity

The scheme shall mature on 11 February 2015

Birla Sun Life Mutual Fund has decided to reset the maturity of Birla Sun Life Fixed Term Plan – Series EH by two days. Pursuant to roll over, the scheme shall mature on 11 February 2015.

Indiabulls MF Announces Change In Minimum Application Amount Under Its Schemes

With effect from 29 January 2015

Indiabulls Mutual Fund has announced change in the minimum application amount under Indiabulls Gilt Fund, Indiabulls Income Fund, Indiabulls Short Term Fund, Indiabulls Blue Chip Fund and Indiabulls Arbitrage Fund, with effect from 29 January 2015. 

Accordingly, the revised minimum application amount would be Rs 500 and in multiples of Re 1 thereafter under growth and dividend option. Minimum additional amount would be Rs 500 and in multiples of Re 1 thereafter.

HDFC FMP 371D January 2014 (2) Announces Dividend

Record date for dividend is 03 February 2015 

HDFC Mutual Fund has announced 03 February 2015 as the record date for declaration of dividend on the face value of Rs 10 per unit under the regular option-normal dividend option, direct option-normal dividend option, regular option-quarterly dividend option and direct option-quarterly dividend option of HDFC FMP 371D January 2014 (2), a plan under HDFC Fixed Maturity Plans-Series 29, a close ended income scheme. The amount of dividend (Rs per unit) will be distributable surplus, as reduced by applicable statutory levy. 

Franklin Templeton MF Announces Change In Directorship

With effect from 27 January 2015 

Franklin Templeton Mutual Fund has announced that Vivek Kudva has been appointed as Director on the Board of Directors of Franklin Templeton Asset Management Company, with effect from 27 January 2015. 

Vivek Kudva is an engineering graduate from IIT, Delhi and has a post graduate diploma in management from IIM, Ahmedabad. 

UTI Fixed Term Income Fund – Series XXI – IV (1146 Days) Floats On

NFO period is from 29 January to 09 February 2015 

UTI Mutual Fund has launched a new fund named as UTI Fixed Term Income Fund – Series XXI – IV (1146 Days), a close ended income scheme. The duration of the scheme is 1146 days from the date of allotment. The New Fund Offer (NFO) price for the scheme is Rs 10 per unit. The new issue will be open for subscription from 29 January to 09 February 2015. 

The investment objective of the scheme is to generate returns by investing in a portfolio of fixed income securities maturing on or before the date of maturity of the scheme. 

The scheme offers growth option, quarterly dividend option with payout and reinvestment facility, flexi dividend option with payout and reinvestment facility, annual dividend option with payout and reinvestment facility and maturity dividend option with payout facility. 

The scheme would allocate 80%-100% of assets in debt instruments with low to medium risk profile and invest upto 20% of assets would be allocated to money market instruments with low risk profile. 

The minimum application amount is Rs 5000 and in multiples of Rs 10 under all the options. 

The fund seeks to collect a minimum subscription (minimum target) amount of Rs 20 crore under the scheme during the NFO period. 

Entry and exit load charge will be nil for the scheme. 

Benchmark Index for the scheme is CRISIL Composite Bond Fund Index. 

Sunil Patil is the fund manager for the scheme. 

IDFC MF Announces Rollover of IDFC Fixed Term Plan – Series 67

The scheme shall now mature on 07 February 2017 

IDFC Mutual Fund has announced rollover of IDFC Fixed Term Plan – Series 67, a close ended income scheme which is due for maturity on 09 February 2015. 

The features of the proposed rollover are as follows: 

Period of rollover: 729 days. 

Date of Maturity for rollover: 07 February 2017. 

Asset allocation post rollover: 

The scheme would invest upto 30% of assets in money market instruments (including CBLO) with low to medium risk profile and invest 70%-100% of assets in debt securities with medium to high risk profile. 

Escorts MF Announces Dividend Under Its Schemes

Record date for dividend is 03 February 2015 

Escorts Mutual Fund has announced 03 February 2015 as the record date for declaration of dividend under the following schemes. The rate of dividend (Rs per unit) on the face value Rs 10 per unit will be: 

Escorts Short Term Debt Fund: 0.11 

Escorts Income Bond: 0.10 

Escorts Income Plan: 0.092 

Escorts Balanced Fund: 1.50 

Escorts Growth Plan: 1.50 

Escorts Tax Plan: 1.00

Mandatory use of jute in packaging for the Jute Year 2014-15 (1st July, 2014 to 30th June, 2013)

The Cabinet Committee on Economic Affairs, chaired by the Prime Minister Shri Narendra Modi, in an important decision has approved to have mandatory packaging of foodgrains and sugar in Jute material to the minimum extent of 90 percent and 20 percent respectively for the Jute Year 2014-15 with certain exemptions. This preserves the position as in the past and helps the jute sector. There had been many concerns that the reservation for jute packaging would be reduced. 

However, in order to preserve and promote this vital sector which generates a lot of livelihoods for farmers and workers, the CCEA has decided that: 

The following commodities may be reserved for jute packaging for the Jute Year 2014-15, to the extent mentioned below: 

Commodity: Minimum percentage to be reserved for packaging in Jute: 

Food-grains: *90 percent of the production 

Sugar: 20 percent of the production 

*With the stipulation that in the first instance, the indents for the whole requirement would be placed for the jute bags and in case the jute mills would not be able to provide the jute bags as per the requisition, than a dilution upto 10 percent would be permissible by the Department of Food in consultation with the Ministry of Textiles. 

Following exemptions may be allowed in the Order under JPM Act.: 

(i) Sugar packed for export but which could not be exported may be exempted from the operation of the Order on the basis of an assessment by and request of the Department of Food and Public Distribution. 

(ii) Following may be out of the purview of the reservation: 

a) Sugar fortified with Vitamins.
b) Packaging for export of the commodities.
c) Small consumer packs of 10 kgs and below for foodgrains and 25 kgs and below for sugar. 
d) Bulk Packaging of more than 100 kgs. 

(iii) In case of any shortage or disruption in supply of jute packaging material or in other contingency/exigency, the Ministry of Textiles may, in consultation with the user Ministries concerned, relax these provisions further, up to a maximum of 30 percent of the production of foodgrains over and above the extent mentioned above. 

Proposal of the HDFC Bank for maintaining the permissible foreign holding in the bank up to 74% of the total paid up capital

The Cabinet Committee on Economic Affairs, chaired by the Prime Minister Shri Narendra Modi, gave its approval to the proposal of HDFC Bank for maintaining the permissible foreign holding in the bank up to 74% of the total paid up capital and issuance of equity shares aggregating to an amount of Rs.10,000 crore to NRIs/FIIs/FPIs subject to aggregate foreign shareholding not exceeding 74 percent of the post issue paid up capital. 

The approval would result in foreign investment of Rs.10,000 crore (approximately) in the country. 

Proposal of M/s Lupin for increase in aggregate limit of investment by FIIs

The Cabinet Committee on Economic Affair today gave its approval to the proposal of M/s Lupin for increase in aggregate limit of investment by FIIs and their sub-accounts registered with SEBI, from 33 percent to 49 percent. 

The approval would result in foreign investment of Rs.6099 crore (approximately) in the country. 

India's Proposed Food Subsidy and Distribution Reforms Would Mitigate Fiscal and Inflationary Pressures

Shirin Mohammadi, Associate Analyst and Atsi Sheth, Senior Vice President, Sovereign Risk Group, Moody's Investors Service Singapore 

On 21 January, a panel appointed by India (Baa3 stable) Prime Minister Narendra Modi recommended reforms to the country's food subsidy and distribution system. We expect the recommendations to prompt policies that will improve the efficiency of India's food supply chain, a credit positive because it will reduce inflationary pressures and the government's fiscal deficit, two key constraints on the sovereign's credit quality. 

The reforms include decentralizing grain procurement, a process for disposing of excess food grains, delivering food and fertilizer subsidies via direct cash transfers, and reducing food subsidy coverage as mandated by the National Food Security Act to 40% of the population from 67%. 

The country's CPI inflation rate has averaged 9% over the past five years, driven largely by food inflation. India's current food subsidy and distribution system support demand for food by lowering its costs to targeted consumers, but suppress the price signals that would prompt a supply response to India's growing food demand. Furthermore, the loss of grain stocks through inefficiency or corruption has raised costs and lowered the socio-economic benefits of the system. 

Greater transparency and efficiency will lead to both demand and supply responding more quickly to price signals, diminishing the distortions that have kept food price inflation higher in India than globally (see exhibit). Because food accounts for about 50% of the average household consumption basket, lower food inflation will dampen wage inflation, improve the interest rate environment and increase the economy's competitiveness. Additionally, because the government is likely to reduce, but not eliminate, food subsidies, lower food inflation will cap its own food subsidy bill going forward. 

India's general government fiscal deficit ratio of 7.2% of GDP for the fiscal year ended March 2014 ranks in the top decile of all Moody's-rated sovereigns. Annual spending on food subsidies grew by 20% on average over the past eight years, compared with 16% overall expenditure growth during the same period. The central government spent about 0.88% of GDP on food subsidies in fiscal 2014, which accounted for 18% of its fiscal deficit. 

The exact reduction in subsidy costs will depend on the measures that the government eventually adopts. At a minimum, changes to the system will keep food subsidy expenditures from rising as rapidly as they have in past years, and as efficiency gains emerge over the next few years, subsidy costs could fall as a percentage of GDP. This, in turn, would help narrow the government's overall fiscal deficit ratios. 

A reduction in food subsidy coverage is politically sensitive in India, where annual per capita income was $1,509 in fiscal 2014. Therefore, it will be difficult to obtain parliamentary approval to amend the National Food Security Act and reduce the percentage of the population eligible for food subsidies. But many of the panel's other recommendations were made in consultation with state governments, suggesting a political and policy consensus that could smooth their implementation. The central government recognizes that the level and volatility of food prices poses risks to its fiscal target of reducing the central government deficit to 3% of GDP in 2017 from a planned 4.1% in fiscal 2015. Therefore, food subsidy reform is likely to remain part of its fiscal consolidation strategy. And the government, as it has done with other policy reforms in recent months, is likely to administer changes in food policy and process that do not require legislative amendments. 

Indian consumers spending may touch US$ 4.2 trillion in next two years: study

With increasing brand awareness amongst the Indian youth and purchasing power of the upper class in tier II and III cities, Indian consumer spending are expected to grow four times to USD 4.2 trillion by 2017, reveals the ASSOCHAM-Yes Bank joint study. 

According to ASSOCHAM-Yes Bank joint report, Indian luxury market is estimated to be worth USD 18 billion by 2017 from the current level of USD 14 billion with unprecedented growth in luxury categories including fashion, automobiles and fine dining, reveals the joint study. 

Globally too consumer spending is on a rise, expected to reach USD 40 trillion by 2020 with an unprecedented growth of USD 12 trillion in a decade, adds the report. Indians consumer spending is expected to grow four times to USD 4.2 trillion by 2017, driven by increasing income and aspirations. 

Indian Luxury market is poised to expand three fold in next three years and the number of millionaires expected to multiply three times in another five years, said Mr. D S Rawat, Secretary General ASSOCHAM while releasing the study. 

While various estimates exists on the size and growth potential of the Indian luxury market; most estimates align on anticipated growth rates of 20% given the tremendous potential waiting to be harnessed such products: apparel and accessories, pens, home décor, watches, wines & spirits & jewelry, services: spas, concierge service, travel & tourism, fine dining & hotels and assets: yachts, fine art, automobiles & real estate. 

The number of Ultra High Net (UHN) worth Households, with a minimum net worth of Rs 25 crore is expected to triple to 5 lakhs in next five years with a five-fold increase in their net worth to Rs 260 trillion. HNIs will be double in number by 2015 to over 4 lakhs with a collective wealth of USD 2645 billion. These projections along with the increasing price parity in the luxury products with other international destinations like Singapore or Hong Kong, and customized products offerings would indicate that the luxury market in India would evolve quickly, adds the report. 

With the luxury market expected to grow at over 20% year on year, PE investments in the luxury segment are expected to increase and support the enhanced size of the Indian luxury market. 

The survey conducted between September to January, 2015 successfully captured the viewpoints of close to 300 executives from India, United States, United Kingdom, Italy, France and Belgium. 

High internet penetration across tier-II and tier-III cities along with high disposable income shall lead to approx. 80 mn transactions on the Internet by 2020. As a result, the luxury consumption is going to increase manifold in the country, highlighted the study. 

The growing exposure of international brands and the desire to indulge in luxury has penetrated smaller cities and towns of India and it is not surprising to note that 66% surveyed do see themselves increasingly using social media platforms as a brand connect and to increase awareness within this new target segment. 

About 62% of CEOs believe the ideal marketing strategy to penetrate in these towns is to begin retailing ‘ladder to luxury' brands. This segment bridges the gap between the luxury and mid- market segments and provides an entry point for new consumers of luxury. 

Close to 26% of the CEOs believe that the biggest hurdle facing the 30% mandatory sourcing criteria is the product quality constraint. Luxury brands are known for their unique style, quality, methodology and materials which collectively form a trademark to their recognition and a perceived sense of identity to their creations. Most CEOs are of the opinion that they cannot achieve the same product quality by outsourcing a part of their production to India. 

Over 46% surveyed believe that regulatory bottlenecks, red-tapism and bureaucracy are the hurdles anticipated. While voicing concerns over the regulatory issues faced by the luxury industry, some suggested that while reforms are underway, current regulations were not supportive enough for businesses to scale viably. 

About 42% of CEOs believe counterfeit goods result in a sizeable loss of revenue and serve as a major hurdle to conduct operations in India. CEO's are of the view that more corrective measures need to be taken to lock down the emergence and continued existence of this market in the form of effective IP enforcement, plugging loop holes in the legal & judicial structure and higher conviction rates since the absence of these measures collectively lead to the global brand's equity getting diluted and reduced consumer trust in their brands. 

The lack of premium retail infrastructure in the country has led to a demand supply mismatch impacting both expansion plans as well as bottom-line margins due to higher rentals. 

Given the uncertainty surrounding the macro issues of the Indian economy, 67% of the CEOs commonly believe that the political and regulatory landscape is an area of extreme concern while over 70% are concerned by the exchange rate volatility which is adding pressures on their margins of most of the luxury players. 

With this level of growth and subsequent investment from luxury businesses, it is estimated that by 2020 the luxury market in India will be responsible for employing 1.8 million people. This will not only preserve traditional craft skills and heritage, but will also support communities, create employment and provide training. 

According to 66% of the CEOs surveyed, the Indian economy is expected to improve in the short term primarily due to the recent reforms and monetary and fiscal measures initiated by the government. 

Only 12% of the CEOs are of the view there will be a decline in the economy and attribute this to the uncertain global environment and inflationary pressures. They are of the opinion that inflation is a serious area of concern, which if prolonged, could impact consumer spending. 

While 21% believe the economy will stay the same in the short term 81% of those surveyed had a more optimistic outlook for the next 3 years due to better infrastructure, a stable government and a favourable regulatory and tax environment. 

CEOs within the luxury leisure travel & and hospitality segments attribute their positive sentiments due to the increasing in & outbound travel trend that is growing their business by double digit percentages year on year. 

A number of others are also currently investing in the consumer space owing to lack of meaningful opportunities in other segments and some of these funds are expected to vet the luxury markets' appetite for capital, said Mr. Rawat. 

While China is on track to become the world's second largest luxury market within the next five years, India too is not far behind. With positive regulations and policies for the retail industry being put in place by the government along with a burgeoning middle class which aspires to own and experience luxury goods and services, India is a market that can no longer be ignored by international brands.

No Shortage of Seeds in Kharif Season 2015

An assessment of availability of agriculture seeds in various states has been made and is satisfactory. In kharif 2015, approximately 137.27 lakh qtl. seed is required against which 140.69 lakh qtl. seed is available. There is no shortage of seeds except soyabean seeds. All the states were requested to take maximum benefit of central assistance under “submission on seed and planting material” and send the Annual Action Plan of 2015-16 by mid March positively. 

PHD Chamber Seeks Implementation Of GAAR From Assessment Year 2017-18

PHD Chamber of Commerce and Industry has urged the Finance Minister that the provisions of GAAR (General Anti Avoidance Rules) be made to be effective from assessment year 2017-18 rather financial year 2015-16 as some of these are subjective, discretionary and thus capable of difference in interpretation, and lead to litigation and hardships. The GAAR provisions in view of PHD Chamber also need to be seen and modified in this respect. 

At his meeting with the Union Minister for Finance, the President of PHD Chamber Mr. Alok B. Shriram suggested, “for stable tax policy to take effect so as to reduce litigation and encourage promotion of India as a business destination or to promote ‘Make in India', GAAR policy needs to be objective”. 

He further stressed, “dissemination of information and learning amongst all stake holders is material to ensure better understanding of the provisions and so that the provisions are correctly applied. The risk of litigation needs to be reduced. Clarificatory examples & circulars and training of officers will help in better understanding and implementation of the provisions”. 

The highlighted issues raised by the Chamber if considered favorably, will promote tax payers compliance and help tax administrators to correctly apply the provisions.
The provisions of GAAR be used fairly in limited number of befitting cases as excessive use would be counterproductive for the nation. “The tax officers must be accountable. This would help in ensuring proper objective application of the provisions and prevent grievances. It is a settled law that tax officers should not make additions/disallowances based on suspicion, conjectures and surmises. This needs to be ensured in the course of application of GAAR”, added Mr. Shriram. 

The Chamber also holds, “there should be no misconception about revenue generation through GAAR. It is not intended to bring an end to tax planning which is within the law. It will not provide a major tax windfall. There are also other anti abuse legislations in place, be it SAAR, Transfer Pricing and BEPS. Work would need to be continued with OECD and others to develop anti abuse legislation and processes. GAAR does however serve as a strong deterrent. It must deter abusive tax planning. It however need not deter bona fide businesses and investments. GAAR must be seen as having effect on only limited types of transactions. GAAR must not result in belt and braces approach by which excessive regulatory provisions are laid down. Good governance is always appreciated and the same would be required in application of GAAR provisions”. 

Signing of MoU between India and Oman in the field of tourism

The Union Cabinet, chaired by the Prime Minister Shri Narendra Modi, has given its approval to enter into a Memorandum of Understanding (MoU) for strengthening cooperation in the field of tourism, between the Ministry of Tourism, Government of India and the Ministry of Tourism, Government of the Sultanate of Oman. 

The main objectives of the Memorandum of Understanding, amongst other things, are: 

a. To expand bilateral cooperation in the tourism sector. 

b. To exchange information and data related to tourism. 

c. To encourage cooperation between tourism stakeholders including hotels and tour operators. 

d. To establish exchange programme for cooperation in Human Resource Development. 

e. To invest in the tourism and hospitality sectors.

f. To exchange visits of tour operators / media /opinion makers for promotion of two way tourism. 

g. To exchange experiences in the areas of promotion, marketing, destination development and management. 

h. To participate in travel fairs /exhibitions in each other`s country and, 

i. To promote safe, honourable and sustainable tourism. 

India and Oman have enjoyed a strong historical and long economic and political relationship. The Sultanate of Oman is a strategic partner for India in the Gulf region and an important interlocutor in the bilateral, Arab Gulf Cooperation Council, the Arab League and the Indian Ocean Rim Association contexts. The two countries are linked by geography, history and culture. Both countries also enjoy warm and cordial relations, which can be ascribed to historical maritime trade linkages, intimacy of the Royal family with India and the seminal role of the Indian expatriate community in the building of Oman. 

Background: 

In recent years Oman has emerged as an important tourism source market for India in the West Asian region. During 2013, India received 62,252 visitors from Oman. Similarly India has emerged as one of the important source market for Oman in the field of tourism. 

Considering the mutual benefits, both India and Oman would like to create an institutional mechanism for enhancing cooperation in this sector. The signing of the MoU will further strengthen and further develop the established relationship between the Ministry of Tourism, Government of the Republic of India and the Ministry of Tourism, Government of Oman for strengthening cooperation in the field of tourism on reciprocal basis. 

FPIs step up buying

Net inflow of Rs 1861.02 crore on 28 January 2015 

Foreign portfolio investors (FPIs) bought shares worth a net Rs 1861.02 crore on Wednesday, 28 January 2015, higher than inflow of Rs 1105.76 crore during the preceding trading session on Tuesday, 27 January 2015. 

The net inflow of Rs 1861.02 crore on 28 January 2015 was a result of gross purchases of Rs 7405.81 crore and gross sales of Rs 5544.79 crore. There was a net inflow of Rs 1693.61 crore into the secondary equity market on 28 January 2015, which was a result of gross purchases of Rs 7238.37 crore and gross sales of Rs 5544.76 crore. The BSE Sensex had declined 11.86 points or 0.04% to settle at 29,559.18 on that day, its lowest closing level since 23 January 2015. 

There was a net inflow of Rs 167.41 crore into the category 'primary market & others' on 28 January 2015, which was a result of gross purchases of Rs 167.44 crore and gross sales of Rs 0.03 crore. 

FPIs have bought shares worth a net Rs 11093.07 crore in this month so far (till 28 January 2015). They have bought shares worth a net Rs 10895.32 crore from the secondary markets in this month so far (till 28 January 2015). FPIs had bought shares worth a net Rs 1036.29 crore last month. They had sold shares worth a net Rs 1707.17 crore into the secondary equity market last month. 

FPIs had bought shares worth a net Rs 97055.90 crore in the calendar year 2014. They had bought shares worth a net Rs 84440.80 crore from the secondary equity markets in calendar year 2014. 

Mixed finish for bullions

Silver shines but gold turns pale

It was mixed finish for precious metals on Wednesday, 28 January 2015 at Comex. Gold prices fell on Wednesday as the U.S. central bank reiterated its commitment to raising interest rates some time in the latter part of the year but the precious metal pared some of its earlier losses after the Federal Reserve's policy statement. Silver rose. 

March gold lost $6.50/oz to $1285.60/oz, while Mar silver rose $0.01 to $18.09/oz on Wednesday. 

The Fed described U.S. economic growth as ‘solid' while categorizing job growth as ‘strong.' The central bank did not spend much time discussing overseas developments, which could help explain some of the selling that developed after the statement was released. 

Furthermore, the FOMC showed little concern over low inflation, saying that while the price level is expected to decline in the near term, a gradual return to 2.0% should follow once the ‘transitory effects of lower energy prices and other factors dissipate.' 

Economic data was limited to the weekly MBA Mortgage Index, which fell 3.2% to follow the prior week's surge of 16.1%. 

Crude plunges close to 4%

Prices drop after a larger-than-expected increase in U.S. crude supplies 

Crude prices registered a big drop in prices on Wednesday, 28 January 2015 at Nymex. Oil futures fell on Wednesday after a larger-than-expected increase in U.S. crude supplies, which kept inventories at their highest level in 80 years. Oil prices have fallen nearly 60% since the summer as the market struggles with a global supply glut and weakening demand. Several investment banks cut their price forecast for crude, with Barclays one of the latest to do so. 

Light, sweet crude for March delivery dropped $1.78, or 3.9%, to $44.45 a barrel on the New York Mercantile Exchange. That was crude's lowest settlement since March 11, 2009.
In the latest weekly inventory report, the U.S. Energy Information Administration said earlier Wednesday U.S. oil supplies rose by 8.9 million barrels in the week ended 23 January 2015. Market had expected an increase around 3.5 million barrels. At 406.7 million barrels, U.S. inventories are at their highest since 1924. 

The report also showed that gasoline inventories dropped by 2.6 million barrels, whereas distillates supplies dropped by 3.9 million barrels. Market had expected gasoline stockpiles up 830,000 barrels, and distillate stockpiles down 580,000 barrels. Refineries operated at 88% of capacity that week, and gasoline production decreased to 9.2 million barrels a day. 

Barclays further cut its outlook for both Brent and Nymex-traded crude, saying it expects WTI to average $42 a barrel in 2015, down from its Dec. 1 forecast of $66. For Brent, the bank now expects to see $44 in 2015, down from $72 predicted earlier. Barclays said it expects Brent and WTI to rise to $60 and $57 a barrel in 2016, respectively. 

The Fed described U.S. economic growth as ‘solid' while categorizing job growth as ‘strong.' The central bank did not spend much time discussing overseas developments, which could help explain some of the selling that developed after the statement was released. 

Furthermore, the FOMC showed little concern over low inflation, saying that while the price level is expected to decline in the near term, a gradual return to 2.0% should follow once the ‘transitory effects of lower energy prices and other factors dissipate.' 

Economic data was limited to the weekly MBA Mortgage Index, which fell 3.2% to follow the prior week's surge of 16.1%. 

Among other energy products, gasoline for February delivery turned lower, off half a penny, or 0.4%, to finish at $1.3450 a gallon on Nymex. February heating oil fell 3 cents, or 1.9%, to end at $1.6318 a gallon on Nymex. 

February natural gas retreated 11.5 cents, or 3.9%, to end at $2.8660 per million British thermal units. That was natural gas's largest one-day drop in a week.