Current Economic Statistics and Review For the
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Theme
of the week:
Gold: Highly Traded Commodity Futures on Domestic Exchanges *
Within
a span of about four years, the commodity futures market has grown rapid
growth following the permission was granted to the national commodity
exchanges to start their operations. A number of commodities have been made
available for trading on these exchanges including precious metals,
non-precious metals, and agricultural commodities among others. However, in
the past two years, a number of concerns raised regarding the trading in
agricultural commodities, which led to the government to set up a committee
to probe into the role played by these exchanges in influencing the prices
and thereby affecting the inflation rate. Amidst all this, the trading in
precious metals and energy contracts have continued to grow and have now
begun to assume a bulk of the share of the total turnover on these
exchanges. Among
the precious metals, gold and silver have been traded for since October
2003; recently, platinum has also been introduced. However, for the purpose
of this note, we focus only on gold among the precious metals. A
number of factors have stimulated the trading in gold futures such as:
availability of international benchmarks, highly traded commodity in
international exchanges, huge domestic demand for gold and an history of
gold derivatives trading in the past in the domestic markets. As a result,
gold has become the highest traded commodity on these exchanges and due to
the surge in turnover, domestic exchanges have recognized as one among the
top derivatives exchange internationally. Yet, the domestic market remains a
price taker and despite such a huge turnover in gold, there is no price
discovery. Further, the ability of futures to play a deterrent to hoarding
of gold while encouraging investment activities might be difficult given the
strong cultural and social setup. Also, in terms of data availability, no
data has been made available on investor profile. Growth
of Commodity Futures
Since the trading in commodity futures have begun in 2003, the total turnover on commodities exchange has galloped from Rs 129,364 crore in 2002-03 to Rs 36,76,927 crore in 2006-07, but following the ban on a few commodities in January 2007 and then in May 2008 as well as imposition of higher margins and stringent norms for trading, the growth in trading has somewhat been restrained to Rs 40,65,989 crore in 2007-08. As a percentage of gross domestic product (GDP) at market prices, the total trading accounted for 89 per cent in 2006-07, which has slipped to 86 per cent in 2007-08 (Table 1). Unlike the decline in agricultural commodities, the trading in precious metals, viz., gold and silver have been rising consistently and they account for a major portion of the total trading on commodity futures, which is partly due to increased trading in these commodities as well as partly due to sharp fall in trading in other commodities such as oil seeds and agricultural commodities.
Concentration
of Trading
Though the trading in commodity futures has been permitted on 23 commodity exchanges, the bulk of the trading is witnessed only on three national exchanges: Multi Commodity Exchange of India Limited (MCX), National Commodity & Derivatives Exchange Ltd (NCDEX) and National Multi-Commodity Exchange of India (NMCE). Driven by the new wave of usage of state of art technology for the trading and settlement system, they have used the time-tested mechanism of electronic trading platform for anonymous automatic order matching system, which is transparent and efficient (Table 2). With such a sharp and rapid increase in the turnover, the domestic commodity futures market has begun to be recognized among the top derivatives exchange of the world. As per the Futures Industry Association, the MCX ranks 28th among the top derivatives exchanges worldwide in 2007, while it ranks third in gold trading followed by NYMEX and TOCOM.
Share
of MCX
The share of MCX in total turnover has been increased from 9 per cent in 2003-04 to 77 per cent in 2007-08 and to 87 per cent in June 2008 in a span of four years, while the share of NCDEX has declined from 38 per cent to 15 per cent and further to 11 per cent over the same period. Among the commodities traded on MCX, the bulk of the trading is in precious metals and crude oil. For instance, as per the data shown in Table 3, the share of gold in major commodities traded has increased from 22 per cent to 39 per cent between March 2007 and 2008. The combined share of gold, silver and crude oil has risen from 69 per cent to 80 per cent in March 2008 (Table 3).
Features
of Gold Trading In Domestic Commodity Futures Market
Gold
futures have been historically traded with the Bombay Bullion Association
playing a dominant role since 1920 for derivatives trading in gold and
silver. The formal forward trading however was banned in 1962 in view of
excessive speculative activities. It was after 41 years, in October 2003,
that the futures trading were allowed in gold. The total trading in gold has
increased both in volume and value terms on these three exchanges. As shown
in Table 4, the volume has increased from 9821 tones in 2006-07 to 10,258
tones in 2007-08. While as per
the World Gold Council, the total demand for gold in
International
Benchmark Unlike
the agricultural commodities, there are international markets wherein gold
has been traded extensively on New York Mercantile Exchange (NYMEX), London
Metal Exchange (LME) and Tokyo Commodity Exchange (TOCOM). Further, the
price of gold has been historically fixed by London Bullion Market
Association since 1919 which serves as an international benchmark. Until
1968, the price of gold was fixed in pound sterling but from April 1, 1968,
the price of gold has been fixed in dollars. The
Indian gold market has always been linked to international gold market in
view of large requirements of imported gold against the backdrop of huge
demand and low domestic supply of gold. As a result, the trading in these
commodities on the domestic exchanges has followed the prices at which they
were traded at LME and NYMEX. Further, the prices on gold futures on MCX
have now been in close alignment with the international prices, the price
risk faced by the Indian physical markets players are effectively covered by
hedging and are used as reference prices for physical transactions. Arbitrage
Opportunities Given
the difference in international and domestic prices, there have been ample
arbitrage opportunities for the investors to reap gains from them. As per
the data published on the website of World Gold Council, the difference
between the dollar and rupee prices is shown in Chart A. For example, a
person would have invested about $449 a few days back and at the same time
the MCX was quoting about Rs 6,340. MCX was quoting about Rs 70-80 below the
parity price because the markets are still raw. They are not so liquid, that
they can be on parity with international markets.
Narrow
Investor Base of MCX While
MCX has been the largest exchange in terms of the turnover in No
Price Discovery
Despite
such a huge turnover in gold futures as well as Lack
of Data Availability
As the data regarding investor profile has not been published by the
exchanges showing the share of retail participants, proprietary positions as
well as hedging and arbitrage activities, its is difficult to ascertain if
the retail investors have begun using futures as an instrument for hedging
and are discouraged of hoarding of gold. However, given the strong cultural
and societal reasons, it seems unlikely that the presence of futures would
attract deter gold hoardings. *
This note has been prepared by Piyusha Hukeri References: Money
Control Website (2008): All that glitters is indeed gold, June MCX
(2003): Gold Note 1 and 2
Highlights of Current Economic Scene AGRICULTURE As
per the latest report by Food and Agriculture Organisation (FAO), Private
traders and big corporate houses like ITC and Cargill have procured only
11.7 lakh tonnes of wheat by June 2008 as compared to 20 lakh tonnes last
year. Of total procurement by private traders, ITC and Cargill have mopped
up 5.4 lakh tonnes and 1.2 lakh tonnes of wheat, respectively, as against
the corresponding quantities of 8.2 lakh tonnes and 3.8 lakh tonnes
purchased last year. The state agencies, so far, have procured nearly 225
lakh tonnes of wheat from farmers. Shortfall
in rains in Cotton
prices have shot up in both domestic as well as international market due to
short supply. Owing to which farmers in Andhra Pradesh have received Rs 3 7,
000 per quintal in the month of July 2008 as compared with Rs 2,400- Rs
2,500 per quintal last month. Cotton sowings completed so far account for
almost 70 per cent of 900, 000 hectares, the total area covered under cotton
during the corresponding period of last year. Around 55 per cent of the
cotton crop has already germinated. It is expected that coverage under
cotton would touch 1.1 million hectare. If rains would get delayed in cotton
growing areas, then farmers are expected to go for resowing. Around 25 per
cent of the summer crop cultivated in
Poor
rains during the current kharif season would spoil cotton production in
central Raw
jute prices are expected to gain in 2008-09 (July – June), as the acreages
under raw jute crop is substantially lower than that of last year and crop
getting destroyed to some extent due to occurrence of floods at the early
stage of plantation. As per the market sources, production of raw jute in
2008-09 is pegged at 75 lakh bales (each bale is of 180 kg). Total
availability of raw jute in the country for the 2008-09-jute year would be
around 100 lakh bales, including a carry forward stock of 20 lakh bales and
likely import of 5 lakh bales from
Acreage
under sugarcane in As per Maharashtra State Co-operative Sugar Factories
Federation Ltd., sugar production in 2008-09 (October-September) is
estimated to fall by 20 per cent to 217 lakh tonnes as against 273 lakh
tonnes last year. It may slip further by 14 per cent to 187 lakh tonnes in
2009-10. Consequent to the fall in output, sugar prices are expected to rise
to Rs 1,600 per quintal from Rs 1,485. In Maharashtra, sugar output is
estimated to drop by 38 per cent to 57 lakh tonnes as against 92 lakh tonnes
last year, in Uttar Pradesh by 14 per cent to 65 lakh tonnes (76 lt), in
Karnataka to 25 lakh tonnes (28 lt), in Tamil Nadu to 20 lakh tonnes (25 lt)
and in Andhra Pradesh to 10 lakh tonnes (13 lt). All India Coffee Board Exporter Association has
portrayed that coffee production in Andhra Pradesh is falling short of the average
rainfall needed for normal kharif sowings. The situation in districts like
Khammam, Andhra Pradesh Jute Development Centre would be
setting up Rs 100-crore Major salt producing states of Industry Index of Industrial Production (IIP) with base
1993-94 for the month of May 2008 registered a growth of 3.8% higher as
compared to the level in the month of May 2007. The cumulative growth for
the period April-May 2008-09 stands at 5.0% over the corresponding period of
the pervious year. The Mining, Manufacturing and Electricity sectors for
the month of May 2008 registered growth rates of 5.2%, 3.9% and 2.0%,
respectively, as compared to May 2007. The cumulative growth during April-May, 2008-09 over
the corresponding period of 2007-08 in the three sectors have been 5.6%,
5.3% and 1.7% respectively, which moved the overall growth in the General
Index to 5.0%. In terms of industries, as many as eleven (11) out of
the seventeen (17) industry groups (as per 2-digit NIC-1987) have shown
positive growth during the month of May 2008 as compared to the
corresponding month of the previous year. The industry group ‘Beverages,
Tobacco and Related Products’ have shown the highest growth of 31.1%,
followed by 12.3% in ‘Transport Equipment and Parts’ and 9.5% in
‘Basic Chemicals & Chemical Products (except products of Petroleum
& Coal)’. On the other hand, the industry group ‘Wood and Wood
Products; Furniture and Fixtures’ have shown a negative growth of 30.7%
followed by 10.4% in ‘Rubber, Plastic, Petroleum and Coal Products’ and
9.0% in ‘Jute and Other Vegetables Fibre Textile (except Cotton)’. As
per Use-based classification, the Sectoral growth rates in May 2008 over May
2007 are 3.0% in Basic goods, 2.5% in Capital goods and 1.2% in Intermediate
goods. The Consumer durables and Consumer non-durables have recorded growth
of 4.4% and 8.1% respectively, with the overall growth in Consumer goods
being 7.2%. Infrastructure The Index of Six core-infrastructure industries
having a combined weight of 26.7 per cent in the Index of Industrial
Production (IIP) (base 1993-94) registered a growth of 3.5% (provisional) in
May 2008 compared to a rise of 7.8 % in May 2007.
During April-May 2008-09, the growth of 3.5% (provisional) was almost
half to that of 6.9% during the corresponding period of the previous year. Crude Oil production (weight of 4.17% in
the IIP) registered a growth of 3.2% (provisional) in May 2008
compared to a negative growth rate of 1.6% in May 2007. The Crude Oil
production registered a growth of 2.1% (provisional) during April-May
2008-09 as against a decline of 0.1% during the same period of 2007-08. Growth in Petroleum refinery production
(weight of 2.00% in the IIP) at 0.1% (provisional)
in May 2008 is miniscule compared to growth
of 14.9% in May 2007. The Petroleum
refinery production registered a growth of 2.1%
(provisional) during April-May 2008-09 compared to 15.0% during the same
period of 2007-08. Impressive growth of 8.3 per cent in coal
(weight of 3.2% in the IIP) in May 2008 compared to growth rate 0.5% in May
2007 has been the only silver lining in an otherwise bleak performance..
Coal production grew by 9.3% (provisional) during April-May
2008-09 compared to an increase of 0.5% during the same period of 2007-08.
Electricity generation
(weight of 10.17% in the IIP) registered a growth
of 2.0% (provisional) in May 2008 compared
to a growth rate 9.3% in May 2007. Electricity generation grew by 1.7%
(provisional) during April-March 2008-09 compared to 9.0% during the same
period of 2007-08. Cement production (weight
of 1.99% in the IIP) registered a growth of 3.8% (provisional)
in May 2008 compared to 9.9% in May 2007. Cement
Production grew by 5.4% (provisional)
during April-March 2008-09 compared to an increase of 7.8% during the same
period of 2007-08. Finished (carbon) Steel production (weight
of 5.13% in the IIP) registered a growth of 5.2% (provisional)
in May 2008 compared to 8.4% (estimated) in May
2007. Finished (carbon) Steel production grew by 4.5%
(provisional) during April-May 2008-09 compared to an increase of 5.6%
during the same period of 2007-08. Inflation Wholesale
Price Index for 'All Commodities' (Base: 1993-94 = 100) for the week ended
19th July 2008 rose by 0.1 percent to 239.3 (Provisional) from 239.0 for the
previous week. The
annual rate of inflation, stood at 11.98 percent for the week ended
19/07/2008 (over 21/07/2007) as compared to 11.89 percent for the previous
week. The annual rate of inflation stood at 4.65 percent as on 21/07/2007
i.e. a year ago. The
index for Primary articles major group rose by 0.1 percent to 247.7 from
247.5 for the previous week. The index for 'Food Articles' group rose by 0.1
percent to 235.9 from 235.7 for the previous week due to higher prices of
moong (4%), urad (3%), arhar (2%) and condiments & spices and gram (1%
each). However, the prices of fish-marine and tea (1% each) declined. Prices
of ‘Non-Food Articles' group
declined marginally to 245.2 from 245.3 for the previous week due to lower
prices of gingelly seed and rape & mustard seed (1% each). However, the
prices of linseed (2%) and raw rubber (1%) moved up.
The
annual rate of inflation, calculated on point-to-point basis, for ‘Primary
Articles’ stood at 10.24 percent (Provisional) for the week ended
19/07/2008. It was 10.69 percent as on 21/07/2007 i.e. a year ago. Annual
rate of inflation for ‘Food Articles’ stood at 5.78 percent for the week
ended 19/07/2008. It was 9.53 percent as on 21/07/2007 i.e. a year ago.
The
index for this major group remained unchanged at its previous week's level
of 376.3 The
index for this major group rose by 0.2 percent to 205.9 from 205.5 for the
previous week. The index for 'Food Products' group rose by 0.6 percent to
212.6 from 211.4 for the previous week due to higher prices of oilcakes (2%)
and sugar and khandsari (1% each). However, the prices of rice bran oil (2%)
and gingelly oil and groundnut oil (1% each) declined.
The
index for 'Textiles' group rose by 0.9 percent to 140.9 from 139.6 for the
previous week due to higher prices of cotton yarn-cones (3%) and cotton
yarn-'hanks (2%). However, the prices of hessian & sacking bags and
hessian cloth (2% each) and synthetic yarn (1%) declined.
The
index for 'Paper & Paper Products' group rose by 0.2 percent to 199.8
from 199.5 for the previous week due to higher prices of map litho paper
(2%) and other boards (all kinds) (1%).
The
index for 'Non-Metallic Mineral Products' group rose marginally to 215.4
from 215.3 for the previous week due to marginal increase in the prices of
cement. The
index for 'Basic Metals, Alloys & Metal Products' group rose marginally
to 299.0 from 298.9 for the previous week due to higher prices of other iron
steel (4%) and lead ingots (2%). However, the prices of zinc (4%) and zinc
ingots (3%) declined. The
index for 'Machinery & Machine Tools' group rose by 0.1 percent to 175.2
from 175.0 for the previous week due to higher prices of power driven pumps
(4%) and other electrical equipment & systems and boilers, its parts
& accessories (1% each). For
the week ended 24/05/2008, the final wholesale price index for 'All
Commodities’ (Base: 1993-94=100) stood at 231.2 as compared to 229.8
(Provisional) and annual rate of inflation based on final index, calculated
on point to point basis, stood at 8.90 percent as compared to 8.24 percent
(Provisional) reported earlier vide press note dated 06/06/2008. Banking The RBI has asked banks to keep their
mobile payment services on hold till it issues final guidelines for such
transactions. Banks can, however, continue to provide basic services such as
mobile alerts for credit or debit entry, balance enquiry or other services
that are in the nature of providing information. The RBI has asked banks to
dissociate themselves from any mobile-based money transfer service that has
not received the regulator’s “explicit approval” or is not covered by
its guidelines. The National Housing Bank (NHB) is
drawing a roadmap including prudential norms to buy home loans from banks
and housing finance companies (HFCs) and securitise the portfolio at a later
date. The scheme is aimed at providing liquidity by releasing capital locked
up in the home loan portfolio. The roadmap is expected to be ready in 2-3
months and is aiming to start operation by March next year. LIC Housing Finance, the mortgage arm of
Life Insurance Corporation of India (LIC), is set to foray into the venture
capital arena and intends to start Rs 500 crore real estate fund by the end
of this financial year. The company has reported a 124 per cent increase in
its net profit to Rs 105 crore for the quarter ended June this year,
compared to Rs 47 crore in the corresponding quarter last year. Financial
Market Capital
Markets Primary Market Nu Tek India Ltd, a telecom infrastructure services
provider, is entered the capital market with an initial public offering
(IPO) of 45 lakh equity shares of Rs 10 each. The offer is open for
subscription from July 29 and will close on August 1 with the price band of
Rs 170 to 192. The company plans to raise between Rs 85 crore and Rs 90
crore. The issue will comprise a fresh issue of 35-lakh equity shares and an
offer for sale of 10-lakh equity shares.
As
per the financial statements of the companies that recently tapped the
capital market, it has been observed that bulk of the amounts have not been
utilised and have been parked in fixed deposits with banks or in debt
schemes. A total of 32 companies mopped up Rs 40,148 crore for their
expansion plans, but could utilise only Rs 23,603 crore so far (Table 1). According to available information, realty,
telecom and logistic companies have used the money for the pre-determined
purposes, while power, port and securities and finance companies have used
only a portion of the IPO resources and parked the remaining amount with
banks and debt funds. Secondary Market The key benchmark indices extended gains for the
third straight week for the week ended July 25, 2008, buoyed the UPA
government winning confidence vote in parliament, sharp correction in crude
oil and short covering of derivative positions. The fall in the last two
sessions has taken away most gains posted in the early part of the week.
Still the BSE Sensex gained 640 points or 4.69 per cent to 14,275 on week on
week basis. The BSE Mid-Cap index rose 333.20 points or 6.35 per cent to
5,572.59. The BSE Small-Cap index advanced 322.89 points or 5.01 per cent to
6778.78. The NSE Nifty edged up 220 points or 5.36 per cent to 4,312 over
the week. The Defty rose 6.7 per cent as the rupee strengthened a lot. All the sectoral indices of BSE recorded remarkable
earnings over the week. Among them Bankex and PSU were the highest gainers
with more than 9 per cent. Finance Minister P Chidambaram on July 23, 2008 said
that the government would try to speed up key financial sector reforms,
including insurance legislation, and would reach out to other parties to
ensure smooth passage in Parliament for key legislation. It is expected that
financial sector reforms—covering pension, insurance, banking and the bond
market—will spur investment and could add as much as 1.5 per cent to According to Crisil report, many asset management
companies (AMCs) are sitting on huge piles of cash or cash equivalents, with
some equity-oriented funds holding as much as 40 per cent of their assets in
cash, due to downturn in the stock market which has lost over 30 per cent
from its January peak. The
country's largest fund house, Reliance Mutual Fund, is holding an average of
over 33 per cent cash in three of its funds - Reliance Equity (39.25),
Reliance Natural Resources (32.30) and Reliance Diversified Power (30.13). Derrivatives The derivative segment has been gone through with
massive volatility and consistently high-volume, given the confidence vote
followed by the blasts in Government Securities Market Primary Market On July 23, 2008, RBI auctioned 91-day and 182-day
T-bills for the notified amounts of Rs.3,000 crore (out of which Rs.2,500
crore under MSS) and Rs.1,500 crore (out of which Rs.1,000 crore under MSS),
respectively. The cut-off yields for 91-day and 182-day T-bills were 7.71
per cent and 9.06 per cent, respectively.
RBI re-issued 8.24 per cent 2018 for Rs.6,000 crore
on July 24, 2008, at the cut-off yields of 9.08 per cent.
Secondary Market Inter bank call rates ruled between 8.96-9.39 per
cent during the week. Bond yields softened over the week, despite high
inflation as global oil prices eased. As per traders, improved inward flows
from foreign institutional investors (FIIs) due to relaxed external
commercial borrowing (ECB) norms supported the bonds. Since the beginning of
the special market operations (SMO), the Reserve Bank of Liquidity remained tight during the week, which has
been evident from the weekend liquidity adjustment facility (LAF) auctions,
where the recourse to the repurchase window has been Rs 43,260 crore. The
tight liquidity has also reflected at the weekly Treasury bill auctions. The
cut-off yield on the 91-day T-bill has been 9.06 per cent or 56 basis points
above the repo rate of 8.5 per cent. The expectations of a further hike in
the repo rate and cash reserve ratio (CRR) during the review of the monetary
policy on July 29, kept the 10-year yield to maturity at 9.16 per cent on a
weighted average basis. On July 21, 2008, bond yields ended at 9.06 per cent
their lowest in more than two weeks, aided by the recent fall in
global oil prices from record peaks, but concerns over political uncertainty
curbed the move The yield on the benchmark 8.24
per cent note due April 2018 fell 10 basis points to 9.02 per cent on
July 23. The spread between the 91-day T-bill and the 10-year weighted YTM
towards the weekend has been just 10 basis points. Average daily trade
volume, improved to Rs 5,000 crore during the week, largely on account of
RBI’s oil bond purchases as part of the SMO and LIC switches for purchase
of the 8.28 per cent 2032 security at an YTM of 9.66 per cent. Bond Market BHW Home Finance Ltd tapped the market by issuing
bonds to mobilise Rs 50 crore by offering 10.85 per cent for 5 years. The
bond has been rated AA+ by Icra. The finance ministry has proposed a mechanism to
improve the tradability of domestic convertible bonds, under which the
equity option can be traded separately. According to market players, this
will enable a portion of the debenture to be traded separately, even at a
discount, and address the needs of different classes of investors. The
ministry has asked SEBI to implement the measure, which has been announced
by finance minister P Chidambaram in Budget 2008-09 as part of efforts to
expand the domestic market for corporate bonds. The move is expected to be
implemented by September 2008. In another market-friendly move, the ministry
is planning to ease the norms governing the pricing formula for American
Depository Receipts (ADRs) and Global Depository Receipts (GDRs). Foreign Exchange Market The rupee appreciated to Rs 42.23 or 2.25 per cent
since July 11. On July 23, strong foreign exchange inflows pushed the
rupee-dollar exchange rate to close at a two-month high of
Rs 42.08 per dollar after opening at Rs 42.45, as crude oil dropped
for a second day. The rupee rallied on speculation that winning the trurt
vote by UPA will introduce changes including giving overseas companies a
bigger role in the local financial industry. The spot rupee gained around
1.6 per cent over previous days close of Rs 42.74. Yet, forward premia
remained firm. One, three, 6, 9 and 12-month forward premia were 7.10 per
cent, 5.97 per cent, 4.69 per cent and 3.67 per cent, respectively. Commodity Derivatives Market A Parliament Standing Committee panel on agriculture
has recommended in Lok Sabha that futures trade in agricultural commodities
should be discouraged as speculative trade leads to artificial rise in
prices. In its 41st report, the panel said that though futures
offers a good hedging mechanism, it has not benefitted small farmers in On July 21, 2008, maize prices crossed Rs 1,000 a
quintal mark both in spot and futures market spurred by the expectation of a
hike in support prices and shortfall in output though the government has
banned exports to increase domestic supplies and bring down prices.
According to market sources, maize active July 2008 contract prices have
jumped up by 18 per cent to trade around Rs 971 per quintal in the last
one-month on strong domestic demand. On July 22, 2008, the National Multi-Commodity
Exchange (NMCE) has taken a decision to set a 30-day deadline for the BSE to
comply with the stake acquisition norms and make payments as per the
mutually agreed guidelines. However, the commodity exchange's board has
agreed to allow a short period of extension to BSE, if it shows adequate
interest to pay the acquisition amount to NMCE. While according to Jagdish
Capoor, the new chairman of BSE, the deal may be honoured within a couple of
weeks, after the clarification of legal issues. Multi Commodity Exchange (MCX) launched coriander seed (coriander) futures on July 28. The whole machine-cleaned variety of Badami coriander will be delivered at ex-Kota mandi with base price quoted in rupees per quintal inclusive of all taxes and expenses but excluding value-added tax. Dhania futures kick-started on the exchange on a positive note at Rs 9,671 per quintal taking cues from strong spot market and futures prices were ruled firm on the first day of trading. The sharp surge in gold futures on MCX, since April 1
has symbolised the investors alternative avenues to park their funds on
commodity markets due to consistant decline in the stock markets. The MCX
near-month gold contract price has risen from Rs 11,521 per 10 grams on
April 1 this year to around Rs 13,203 per 10 grams in just over three
months. Gold prices have vulnerable to reach $1,000 a troy ounce in global
markets, which are pushing up local prices. The volume of gold traded on the
exchange surged to around 583.7 tonnes in the last 15 days of the April-June
quarter from around 425.4 tonnes in the first 15 days of the quarter. In
value terms, the metal rose to around Rs 728 billion from around Rs 503
billion. A spike in returns from gold exchange-traded funds (ETFs) also
gives an indication of the preference for gold as a majority of the gold
ETFs listed on the stock exchange posted a return of close to 20 per cent in
the last two months. The politically influential sugar cooperatives of According to data released by FMC, the total turnover
of all 3 national commodity exchanges and 19 regional exchanges in the
country during July 1-15, doubled to Rs 2,36,846 crore from Rs 1,17,028
crore against the previous year. Of this, 87.90 per cent has been
contributed by MCX. The turnover went up to Rs 13,53,173 crore against Rs
10,14,845 crore during the corresponding period in 2007-08.
Insurance The Insurance Regulatory Development
Authority (IRDA) is planning to issue a notice to Life Insurance Corporation
of Corporate
Sector Mumbai-based Nissan Copper Ltd is
planning to set up a Videocon Retail, a part of the Venugopal
Dhoot-promoted Videcon Industries, plans to invest Rs 800 crore to expand
its electronic retail format, Next Retail and Plannet M, the mobile, music,
entertainment and lifestyle chain in the next three years. The country’s largest car-maker Maruti
Suzuki’s net profit has dipped by 6.8 per cent to Rs 466 crore for the
first quarter ended June 2008 as against Rs 499 crore in the corresponding
period last year, mostly on account of rising raw material costs, a change
in accounting norms and a loss from derivative instruments. Reliance Industries Ltd (RIL) has
reported a 13 per cent rise in its net profit to Rs 4,110 crore for the
first quarter ended June 2008 as against Rs 3,360 crore in the corresponding
period last year, as RIL was able to sell its products at higher prices and
also owing to doubling of export sales. The government has imposed a steep
anti-dumping duty on imported picture tubes for colour TVs from External Sector Exports during May 2008 had been US $ 13782 million as against US $ 12210
million in May 2007 registering a growth of 12.9 per cent. As against this
Imports was valued at US $ 24548 million as against US$ 19313 million
recording a growth of 27.1 per cent. In rupee terms, while export increased by 16.6 per cent , import flared
up by 31.3 per cent.As a result trade deficit was estimated at US $ 10766 in
May 2008 million higher than the deficit at US $ 7103 million during May
2007Oil imports were estimated during May 2008 at US$ 8465 million
and non-oil imports at US $ 16083 million was 50.8 per cent and 17.4
per cent higher than that in last year Telecom The Department of Telecommunications (DoT)
has raised questions about the merger between Idea Cellular and Spice
Telecom violating key clauses on intra-circle merger and mobile licence
conditions. The government may suspend the DTH
licence of Bharti Group’s broadcasting company, Bharti Telemedia, for
non-compliance with the foreign direct investment (FDI) norms and breaking
the cross media ownership regulations.
*These statistics and the accompanying review are a product arising from the work undertaken under the joint ICICI research centre.org-EPWRF Data Base Project. | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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