Financial focus Fortnightly Newsletter InFINeeti ISSUE 1
Volum e 4
2014
TOP STORIES……………..1 MARKET ACTIVITY.....…...2 ECONOMICS .……….....….. 3 FINE WORD FROM
FIN WORLD......………….. 4 POLICY RATES AND
MARKET UPDATES……... 5 WARREN BUFFETT
MANAGEMENT RULES…. 5
Financial focus
A one stop guide to know about all the recent happenings in the financial world
TOP STORIES : INDIA
AS MODI HEADS TO G20, INDIA AND US ANNOUNCE WTO DEAL: Moving to end the deadlock at the World Trade Organisation (WTO) over the signing of a landmark Trade Facilitation Agreement (TFA), India and the US on Thursday announced they had “successfully resolved” their differences on the issue of public stockholding for food security purposes Read more...
GOVERNMENT HIKES EXCISE DUTY ON DIESEL AND PETROL: Petrol and diesel prices were on Thursday hiked by Rs 1.50 a litre after government raised excise duty on the two fuel to mop up an additional revenue of about Rs 13,000 crore. The fall in international oil prices had resulted in six consecutive reduction in petrol prices since August and two in diesel in the last one month and there was possibility of another round of cuts this weekend. Read more...
JAN DHAN YOJANA: WHY IMPRESSIVE NUMBERS DON’T MEAN MUCH TO FINANCIAL INCLUSION DRIVE The aggregate numbers are designed to impress — 6.99 crore accounts have already been opened since PM Narendra Modi launched Jan Dhan Yojana on Independence Day, according to pmjdy.gov.in, a government website. But several concerns lie hidden beneath those numbers.
Read more... COTTON PRICE CRASH WORRIES FARMERS IN RAICHUR: It was a bad day for Sharanabasava, a farmer from Devasugur village in Raichur taluk, who had brought two mini trucks of cotton to Raichur hoping better price. Unfortunately for him, the price of cotton had fallen from Rs. 4000 a quintal a week ago to Rs. 3500 a quintal on Thursday. With no alternatives before him, he unwillingly sold his crop and was returning home unhappy.
Read more...
Financial focus Fortnightly Newsletter InFINeeti
TOP STORIES : WORLD
AFTER US-CHINA CLIMATE DEAL, FOCUS ON INDIA TO FOLLOW SUIT After this week's carbon deal between the United States and China, No. 3 emitter India faces growing pressure to devise a clear strategy and step out of China's shadow during pivotal global climate talks. India has given no sign what kind of commitment it will make to address climate change in a global agreement. Officials previously stressed that India would likely opt to slow emissions growth rather than Read more...
OIL SLUMPS TO FOUR-YEAR LOW AS BRENT CRASHES BELOW $80 A BARREL Oil prices slumped more than 3 percent to four-year lows on Thursday, with benchmark Brent crashing below $80 a barrel, after a stockpile surge at the delivery point for U.S. crude frayed nerves of traders already worried about an oil glut. The decline compounded Wednesday's losses stemming from comments by Saudi Arabia's oil minister Read more...
CHINA OFFERS ASEAN FRIENDSHIP, LOANS AS SOUTH CHINA SEA TENSION BUBBLES China's Prime Minister Li Keqiang proposed a friendship treaty with Southeast Asian countries and offered $20 billion in loans on Thursday but held firm on the line that Beijing will only settle South China Sea disputes directly with other claimants China, Taiwan and four members of the Association of Southeast Asian Nations (ASEAN) Read more...
MARKET ACTIVITY
WALL STREET TOUCHES NEW RECORD AFTER EARNINGS
WAL-MART
US stocks advanced modestly on Thursday to send the Dow and S&P to new record intraday highs following earnings from Wal-Mart and data on the labor market. Wal-Mart shares climbed 3.4 percent to $81.92 as one of the biggest boosts to both the Dow and S&P 500 after the retail giant posted a 2.9 percent Read More...
OIL TUMBLES TO FOUR YEAR LOW BELOW $79, AWAITS OPEC Brent crude fell to a four-year low below $79 a barrel on Thursday after Chinese data showed further economic slowdown, Saudi Arabia kept silent about a possible cut in production and crude stocks built up at a key U.S. delivery point.
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Financial focus Fortnightly Newsletter InFINeeti
ICICI BANK TAPS CHINESE DEBT MARKET AGAIN, RAISES 600 MILLION YUANS Private sector lender ICICI Bank today raised 600 million yuans from the Chinese debt market (Dim Sum bonds) or a little over $ 95 million, at a coupon of 4 per cent, merchant banking sources said here this evening. This is the fourth time that the city-based lender has tapped the Dim sum bond market and has so far raised 2,050 million yuans. Read more...
ECONOMICS
INDIA’S ECONOMY TO GROW BY 6.4% NEXT YEAR : OECD The country could be within striking distance of China by 2016 in terms of the pace of growth, with that country’s forecast to slow in the years ahead, according to the OECD (Organization for Economic Co-operation and Development). But that doesn't mean the central bank can relent in the fight against inflation, it said.
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SEPTEMBER IIP RECOVERS TO 2.5%; OCTOBER CPI AT 5.52% Industrial production growth picked up marginally in September to a threemonth high and consumer inflation fell to record low, yet few would be willing to risk a wager on Reserve Bank of India Governor Raghuram Rajan cutting interest rates next month to stimulate growth.
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ECONOMY ON TRACK TO GET BACK ON GROWTH TRAJECTORY: INDIAN ECONOMIC SUMMIT 2014 At the India Growth Outlook session, the panelists highlighted the challenges and opportunities India faces as investor interest in the country increases. They agreed that India was on track to get back on the growth trajectory. Foreign investors were ready to give the government time.
Read More... DID YOU KNOW ?
EUROPEAN UNION FAST FACTS The EU is run by five main bodies: European Parliament, Council of the Union, European Commission, Court of Justice, and the Court of Auditors. The European Union is a major economic unit. The combined population of member countries is 57% larger than that of the United States. Read
Financial focus Fortnightly Newsletter InFINeeti
Fine Word from Fin World: AIR POCKET STOCK A stock that experiences a sudden drop, similar to a plane hitting an air pocket. Air pocket stocks are usually the result of investors reacting to negative news. This is almost always caused by shareholders selling because of unexpected bad news. An air pocket stock isn't necessarily in dire straits. More often than not, the abrupt, drop caused by disgruntled investors is usually the end of the correction.
CUTTING A MELON A slang term used to describe when a board of directors declares an additional dividend in addition to the regular distribution. The additional dividend can be in the form of cash, stock or property. The board of directors (BOD) is responsible for deciding how it will share the company's earnings with shareholders in the form of dividends. In most cases, dividends are issued in accordance to a set policy and are paid on preset schedule, such as annually or quarterly. The BOD is cutting a melon when the company has earned additional income, this is the melon and distributes a portion of it to shareholders. The bigger the melon, the sweeter it tastes to investors!
ONE NIGHT STAND INVESTMENT A purchased security that was intended for a long-term investment, but is instead sold the next day. One night stand investments are often sold urgently on the trading day after purchase, because the investor regrets buying the shares to such a degree that fear and panic begin setting in. This can even lead to immediate, short-term losses. A one-night stand investment is typical of an indecisive investor, and is related to the field of behavioural finance. Much can change overnight in a company and an industry. An investor who researches an investment and buys one day, feeling that the company and its future are strong, may be panic-stricken and ready to sell the next day when unexpected news threatens his or her perceptions of the security of his or her long-term investment. The incidents instigating the sudden sale can include many things, such as the company's profits missing their target, industry shifts, acquisitions and regulatory changes.
TAKE A BATH A term referring to the situation of an investor who has experienced a large loss from an investment or speculative position. Investors whose shares have declined significantly are said to have taken a bath. For example, following the technology boom of the late 1990s and early 2000s, many investors, because of their huge losses, were said to have taken a bath. Source: www.Investopedia.com
RESULT OF FEW MAJOR COMPANIES-STOCK PERFORMANCE YoY Revenue increase
Profit increase
25.00% 20.00% 15.00% 10.00% 5.00% 0.00% -5.00% -10.00% -15.00%
Maruti Suzuki
NTPC
HCL Tech
ICICI
PVR
Financial focus Fortnightly Newsletter InFINeeti
POLICY RATES AND MARKET UPDATES DATE :- 14/11/2014 BANK RATE
9.00
REPO RATE
8.00
REVERSE REPO RATE
7.00
MARGINAL STANDING FACILITY RATE
9.00
SENSEX
27,940
NIFTY
8,357
WARREN BUFFET MANAGEMENT RULES : RULE 7 & 8 RULE 7 : We use debt sparingly and, when we do borrow, we attempt to structure our loans on a long-term fixed-rate basis. We will reject interesting opportunities rather than over-leverage our balance sheet. This conservatism has penalized our results but it is the only behaviour that leaves us comfortable, considering our fiduciary obligations to policyholders, lenders and the many equity holders who have committed unusually large portions of their net worth to our care. (As one of the Indianapolis “500” winners said: “To finish first, you must first finish.”)
RULE 8 : A managerial “wish list” will not be filled at shareholder expense. We will not diversify by purchasing entire businesses at control prices that ignore long-term economic consequences to our shareholders. We will only do with your money what we would do with our own, weighing fully the values you can obtain by diversifying your own portfolios through direct purchases in the stock market.
InFINeeti Team Adhiraj Bandyopadhyay (9088342361) Gayathri Bhuvanagiri (8274948812) Mehul Gahrana (8017041166) Suryanarayan Panda (9830351387)