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Subprime mortgage crisis - what is it?
2007-08-23 11:30:00
I am sure that every one of you have read about subprime mortgage crisis that has hit the stock markets and has led to a significant correction across markets (including that of India).So what exactly are subprime mortgages and what is the crisis that has come up now? I try to briefly outline the same below.Subprime lending refers to the practice of lending to borrowers who do not qualify for market interest rates because of problems with their credit history. Subprime lending encompasses a variety of credit instruments, including subprime mortgages, subprime car loans, and subprime credit cards, among others. The rates on subprime lending are obviously higher and the rate depends on how low the credit score of the borrower is.In US, there is a concept of a credit score that is between 300 and 850 (higher the score, better is the credit rating). Subprime lending is typically to borrowers whose score is less than 620.When the economy was growing (as it was in the last couple of years...
More About: Mortgage , Crisis , Prim , Cris

Monetary Policy Update - CRR hiked by 50bps
2007-07-31 08:53:00
The RBI has kept all rates unchanged (repo at 7.75% and reverse repo at 6%) but has hiked the CRR from 6.5% to 7.0% starting the fortnight beginning August 4, 2007. They have also withdrawn the ceiling of Rs. 3,000 crores on daily reverse repo under LAF with effect from August 6, 2007.This is not in line with what I had predicted. And this would not be taken by the markets kindly.http://feeds.feedburner.com/indiaf inancialmarkets
More About: Monetary Policy , Policy , Update

Monetary and Credit Policy 31/Jul/07 - Expectations
2007-07-25 10:45:00
RBI would announce the monetary and credit policy on 31/Jul/07. What can we expect?RBI would hold all rates steadyThis is because inflation is under control - the inflation currently is around 4.27% as against 5.94% as of end of Mar/07. And the inflation is likely to remain around 5% because of the favourable base effect that would continue till second quarter of FY08. There are some pressures though - the main one being that of crude oil prices that have gone up significantly now (a round of fuel price hike in India cannot be ruled out - infact it is definitely expected).There has also been a moderation in credit growth - the credit growth is lower at 25% from around 30%.Also, any future hikes would attract larger capital inflows and leave the economy with a problem of plenty.RBI would definitely focus on liquidity management, no CRR hikeThere currently is excess liquidity in the system due to multiple factors - capital flows have remained quite strong prompting RBI intervention an...
More About: Credit , Policy , Expectations

Markets Touch New Highs Again - 23/Jul/07
2007-07-23 13:47:00
The markets have been on an upswing for sometime now and today they reached new highs - the Sensex closed at 15,732 (up 166 points) and Nifty closed at 4,619 (up 53 points).In the bond markets, the yields fell to the lowest after RBI said that it would sell bonds worth approx. $1 billion to drain out funds, half of what it sold last week. The forex reserves have increased by about $15 billion in the last two months, primarily because RBI has been buying dollars to stem the appreciating rupee.http://feeds.feedburner.com/indiafi nancialmarkets
More About: Markets , Touch

RBI hikes CRR by 50 bps, repo rate by 25 bps
2007-03-30 18:44:00
The Reserve Bank of India has decided to hike the CRR by 50 bps from 6% to 6.50% and the repo rate by 25 bps from 7.50% to 7.75%. The repo rate hike is effective immediately. The CRR change would take place in two phases, from 6% to 6.25% on Apr 14 and from 6.25% to 6.50% on Apr 28. This clearly is due to high rate of inflation which, as mentioned by me in my earlier posts, continues to stay above the RBI tolerance limit of 5.0% to 5.5%.This would suck out Rs. 15,500 cr of liquidity from the markets. Most banks would definitely think of hiking rates now.http://feeds.feedburner.com/indiafina ncialmarkets
More About: Repo , Rate

Weekly Roundup 19/Mar/07 to 24/Mar/07
2007-03-24 10:52:00
The markets across the world bounced back and Indian indices were no exception. The Sensex gained 855 points to settle at 13,285.93 and the Nifty gained 255 points to settle at 3,861.05. The table below gives a comparison of Indian indices vs. other indices across the world:Other newsInflation steady at 6.46% : Inflation remained unchanged at 6.46% for the week ended Mar 10 as the rise in prices of some items were neutralised by decline in others. Net net, there is very little probability that the RBI target of 5.0-5.5% would be met by Mar 31.http://feeds.feedburner.com/indiafinan cialmarkets
More About: Roundup , Weekly

Markets up 3 days in a row, subscribe to ICRA IPO
2007-03-22 13:07:00
The Indian stock markets have been rising for the last 3 days and today was no exception. The Sensex went up 365.90 points to close at 13,311.78 and Nifty went up 112.65 points to close at 3,877.20. Market breadth was positive at 1.69:1 in favour of advances. Banking and telecom stocks were the primary gainers.The US Fed on Wednesday held the rates steady as expected and if the US economy faces a slowdown this quarter, there is a possibility of a rate cut as early as Jun. Lets wait and watch.Subs cribe to ICRA IPO at cutoff price. It is a good issue and with development in financial markets and Basel 2 implementation round the corner, a lot of business would surely go to the rating agencies and they would surely do well.http://feeds.feedburner.com/indiafin ancialmarkets
More About: Markets , Days , Scribe

Weekly Roundup (12/Mar/07 to 17/Mar/07)
2007-03-17 08:28:00
The Indian stock markets followed the global market trends and declined in the last week - the Sensex lost 455 points (3.53%) to close at 12,430 and Nifty lost 110 points (2.96%) to close at 3,608. FIIs were net sellers by about Rs. 345 crores and mutual funds were also net sellers by about Rs. 121 crores for the week ended Mar 15.The table below gives the performance of Indian indices vs. rest of the world in the last week as well as the last year:It should be noted that Indian markets had the steepest fall amongst the various global markets. All of us have read the papers and we all know what ails the world markets - concerns over potential losses that the US subprime mortgage lenders are facing. Couple this with Alan Greenspan's comments that there is a 1/3rd probability of recession and that subprime mortgage defaults would have a big impact on the economy and the crisis that hit these markets is easily explained. But look at the US indices - the Dow Jones lost 1.35% and Nasdaq...
More About: Roundup , Weekly

Markets end flat (15/Mar/07)
2007-03-15 14:28:00
The markets opened strong on the back of recoveries in other Asian markets but lost all the intraday gains and managed to close just higher than previous close. The Sensex closed 7.55 points higher at 12,537.17 and Nifty closed 2.50 points higher at 3,643.60. Market breadth was positive at 1.31:1 in favour of gainers.I think the markets are going to be choppy like this for some time to come. I am sure all of you have read in the papers about unwinding of yen carry trade and fears over high delinquencies of sub-prime mortgages in US. Markets across the world are unsure of what will hit them next. The positive news for Indian markets should come once the results start coming out in Apr/May and maybe we will see some stability then.http://feeds.feedburner.com/indiafin ancialmarkets
More About: Flat

Hutchison Essar to become Vodafone Essar
2007-03-15 09:55:00
Vodafone is signing an agreement with Essar today on management issues. Vodafone would pay $11.1 billion for a 67% stake in Hutch ison Essar and Essar would continue to own the remaining 33%. The company would now be called Vodafone Essar and Ravi Ruia would be the Chairman of the board and Arun Sarin would be the Vice Chairman.Essar may get an option to sell its Hutchison Essar stake to Vodafone within four years as part of a shareholder agreement.http://feeds.feedburner.com/ind iafinancialmarkets
More About: Vodafone , Voda

Markets hit by global woes, news on rating/inflation (14/Mar/07 update)
2007-03-15 05:25:00
The Indian stock markets followed the global cues and took a big hit - the Sensex was down 471.20 points to close at 12,511.78 and Nifty was down 129.45 points to close at 3,641.10. Market breadth was negative at 2.39:1 in favour of losers. IT and banking shares took severe beating.In other news, Moodys has said that India's plan to cut deficit is not enough and that it should be more aggressive and show results before they can consider a change in rating outlook.On the inflation front, RBI deputy governor Rakesh Mohan has said that they would take all possible monetary measures to maintain price stability. The inflation target for Mar 31 is 5.0-5.5% but as I have said repeatedly before, this is impossible to achieve.http://feeds.feedburner.com/india financialmarkets
More About: News , Inflation , Markets , Global , Update

Markets end flat, comparison of Indian Indices vs. the rest
2007-03-12 14:55:00
The table below gives a comparison of Indian indices vs. other global indices:The markets ended flat today - at one point of time, the Sensex was up 172 points but it lost steam towards the end of the day. Cement stocks contributed to this decline. The Sensex closed at 12,902.63 (up 17.64 points) and Nifty closed at 3,734.60 (up 16.60 points). The market breadth was strong at 1.49:1 in favour of gainers.Data on IIP released today showed a growth rate of 10.9% in Jan 2007 as compared to the previous period.http://feeds.feedburner.com/indiaf inancialmarkets
More About: Markets , Comparison , Rest , Flat

Smart recovery by markets, Idea lists tomorrow
2007-03-08 14:24:00
The Indian stock markets staged a smart recovery today - the Sensex closed 469.60 points up at 13,049.35 and Nifty closed 134.80 points up at 3,761.65. One of the triggers for the recovery was the recovery seen in other Asian markets as well.Idea Cellular lists tomorrow - the offer price was Rs. 75.00 in the recently concluded IPO. The stock is expected to list in the range of Rs. 100.00 to Rs. 110.00.IPCL closed 12% higher due to the news that it would get merged with Reliance Industries.http://feeds.feedburner.com/in diafinancialmarkets
More About: Recovery , Markets , Smart , Lists

Markets lose steam, MindTree closes at 45.88% premium (7/Mar/07)
2007-03-07 13:08:00
The Indian stock markets opened firm but lost steam as the day progressed and eventually they closed in the red. The Sensex was down 97.29 points to close at 12,599.80 and Nifty was down 28.80 points to close at 3,626.85. The market breadth was negative at 3.5:1 (it was positive when trading started).MindTree Consulting had a great debut today - it closed at Rs. 620.30, which is a premium of 45.88% over its issue price of Rs. 425.00.http://feeds.feedburner.com/indiaf inancialmarkets
More About: Markets , Steam , Premium , Remi

Singapore Exchange buys 5% in BSE
2007-03-07 12:04:00
Singapore Exchange is all set to buy a 5% stake in BSE - this follows the purchase by Deutsche Borse in Feb07. Singapore Exchange will pay $42.7 mln to buy this stake (Deutsche Borse paid $42.4 mln). The price paid per share is Rs. 5200.00 (same as that of Deutsche Borse).http://feeds.feedburner.com/indiaf inancialmarkets
More About: Singapore , Chang , Chan

Indian Indices vs. Rest of World
2007-03-07 06:22:00
I usually post a comparison of Indian indices vs. the rest of the world on Saturdays but this time I got busy. So, here is the table that gives the comparison.The Sensex closed yesterday at 12,696.09 and Nifty closed yesterday at 3,655.65 after a significant rally and as of now, Sensex is up 96 points at 12,792.10 and Nifty is up 31.7 points at 3,687.35.http://feeds.feedburner.com/indi afinancialmarkets
More About: World , Rest

Idea Cellular IPO Status
2007-03-05 09:33:00
Check here to know the status of Idea Cellular IPO applications.http://feeds.feedburner.com/ indiafinancialmarkets
More About: Status