Weekly News: Economic Times Presented By: NitinGoel
Retail investors cash out of market, sell shares in companies (16 Oct, 2010) Funds led by Fidelity , Templeton and Goldman Sachs Group may have created a record investing $23 billion in Indian stocks, but retail investors are turning away from the market, as they still lick their wounds of the last market crash in 2008. India’s benchmark indices have been on a tear this year on strong economic and earnings growth prospects, but typical of the retail psychology many are paring their stakes, as stock prices reach their previous peaks. The desire to take capital out due to fears that there may be yet another collapse and the attractiveness of alternative investments such as retail bonds are leading to investors selling stocks
LSE, Reliance Foundation to set up universities in India (16 Oct, 2010) The London School of Economics will collaborate with Reliance Foundation, run by the promoters of India's largest corporate house, for setting up world-class universities in the South-Asian nation. The Foundation has taken up the challenge to set up a world class university in India to put India on the global education map. India faced the challenge of equity and expansion in education and healthcare DhirubhaiAmbaniInternational School in Mumbai had produced some of the top talents in the country and some of the students are currently studying at the LSE.
Gush of dollars set to hit India as emerging mkts close gates (15 Oct, 2010 ) India is staring at the possibility of overseas fund flow trickles turning into a flood, as more emerging markets shut their doors on cheap money from developed nations that are throwing money to get their economies back on feet. Policymakers in the government and RBI may be forced to choose selective measures to restrain the flow of capital that is beginning to disturb trade and commerce. India has resisted the temptation to indulge in controls and has openly said it will not resort to such measures as the flows do not threaten the markets at this point.
RBI buys dollars, likely year's first: Traders (14 Oct, 2010) The Reserve Bank of India bought dollars around 44.10 rupees on Thursday in a move that helped brake a rise in the rupee and is believed by traders to have been its first such intervention this year. The Reserve Bank of India has been reluctant to intervene in currency markets but may be forced to in coming weeks as foreign investors are expected to pour in billions of dollars to buy shares in the country's largest ever IPO. Coal India's $3.5 billion initial public offer, which opens on Monday, is expected to attract heavy foreign fund flows and may push the rupee up to 43.50 and force further intervention. India would intervene in the foreign exchange markets in order to maintain stability. Other central banks in Asia including the Bank of Thailand and Bank of Korea have been intervening in their forex markets to prevent sharp appreciation of their currencies due to an influx of hot money flows in recent weeks.
Coal India premium falls in grey market (16 Oct, 2010) Grey market premium for Coal India shares in Ahmedabad fell 11% to Rs 25 a piece from as high as Rs 28 on Thursday, following a slide in the secondary market. It was trading at a premium of Rs 32 on Tuesday. The nation’s biggest initial public offer would be open between October 18 and 21 and will begin trading on November 4. The Sensex fell 1.8% on Friday. The government plans to raise Rs 15,200 crore, selling 10% of the company, or 63.16 crore shares, in the Rs 225-245 price band. Coal India staff and retail investors will get a 5% discount to final price. Although many recent offers have performed poorly, analysts expect Coal India to yield positive returns since it is priced at a discount to global peers. The BSE IPO index is down 5.6% in the last month, compared with the Sensex’s 3.2% gain.