The market may remain volatile next week as traders roll over positions in the futures & options (F&O) segment, as the near month December 2014 derivatives contracts expire on Wednesday, 24 December 20014. The stock market remains closed on Thursday, 25 December 2014, on account of Christmas.
NTPC will be in focus ahead of a meeting of the company's board of directors on Tuesday, 23 December 2014, to consider a proposal for issuing bonus debentures to the shareholders of the company. NTPC on 18 December 2014 said that it is keen to reward its shareholders for their continued support as the company has entered its 40th year of operations.
All eyes are on the fate of key reform bills pending in parliament. The fate of several crucial bills hangs in a limbo due to several disruptions by the Opposition over the alleged forced conversion row in the Rajya Sabha. With just two days left for the winter session of Parliament to end, the chances of the passage of the Coal Mines (Special Provisions) Bill, 2014 in the Rajya Sabha and the passage of the Insurance Laws (Amendment) Bill, 2008 in both the houses of parliament, look bleak. The winter session of the parliament concludes on 23 December 2014. The government had planned to get Insurance Bill and the Coal Mines (Special Provisions) Bill, 2014 passed in parliament during the winter session. The Coal Mines (Special Provisions) Bill, 2014 has been passed in the Lok Sabha, but the Bill is yet to be tabled in Rajya Sabha where the government is in minority. The bill allows the government to enforce rules and guidelines for auction/allocation of 204 coal blocks cancelled by the Supreme Court in September this year. According to media reports, the government is looking at taking the ordinance route for the Coal Bill.
The government may have to wait till the Budget Session of the parliament for the Insurance Bill. It may be recalled that the Parliamentary Select Committee in its report tabled in Rajya Sabha on 10 December 2014 agreed a composite cap of 49% on foreign investment in the insurance sector, which includes all types of foreign investment as opposed to the 26% foreign direct investment (FDI) allowed at present. Finance Minister Arun Jaitley had said in his maiden budget speech in July that the composite cap in the insurance sector should be increased to 49% from the current level of 26%, with full Indian management and control.
A steep slide in global crude oil prices over the past few months augur well for India. Deregulation of diesel price announced by the Indian government in October 2014 and a sharp decline in global crude oil prices over the past few months will help reduce the government's fuel subsidy burden and help contain its fiscal deficit. The steep slide in global crude oil prices will also help India in containing its current account deficit and fuel price inflation. India imports 80% of its crude oil requirement. However, a weakness in rupee against the dollar will restrict the benefit of falling global crude oil prices to that extent. A weak rupee raises the cost of imports.
Meanwhile, a mid-term economic review tabled by the finance ministry in parliament on Friday, 19 December 2014, stated that the backlog of stalled projects needs to be cleared more expeditiously, a process that has already begun. There are stalled projects to the tune of Rs 18 lakh crore (about 13% of GDP) of which an estimated 60% are in infrastructure, according to the mid-term review. The finance ministry also said that adhering to the fiscal deficit target of 4.1% of GDP in 2014-15 is a major challenge. The report stated that the government is committed to meeting the fiscal targets for 2014-15, despite the difficult odds engendered by a combination of factors. A pick-up in economic activity in the second half of the year is critical to prevent a slippage and to meet the overall fiscal deficit target during 2014-15.
According to the fiscal challenges pointed out by the mid-term view, the tax base was weaker than expected, thanks to unanticipated moderation in inflation. The revenue projections were over-optimistic. The budget was unduly burdened by a legacy of carried-over expenditures. Moreover, the deficit target of 4.1% of GDP for 2014-15 represented strongly pro-cyclical fiscal policy-consolidation when growth was below potential.
In Europe, Greece's parliament holds a second vote on Tuesday, 23 December 2014, to choose a new president, with a two-thirds majority required for the election of Prime Minister Antonis Samaras's nominee, Stavros Dimas. Dimas failed to gain enough support in the first round of polls held on 16 December 2014. If the parliament fails to elect a new head of state in three attempts, snap elections will be called that the anti-austerity Syriza party is projected to win.
NTPC will be in focus ahead of a meeting of the company's board of directors on Tuesday, 23 December 2014, to consider a proposal for issuing bonus debentures to the shareholders of the company. NTPC on 18 December 2014 said that it is keen to reward its shareholders for their continued support as the company has entered its 40th year of operations.
All eyes are on the fate of key reform bills pending in parliament. The fate of several crucial bills hangs in a limbo due to several disruptions by the Opposition over the alleged forced conversion row in the Rajya Sabha. With just two days left for the winter session of Parliament to end, the chances of the passage of the Coal Mines (Special Provisions) Bill, 2014 in the Rajya Sabha and the passage of the Insurance Laws (Amendment) Bill, 2008 in both the houses of parliament, look bleak. The winter session of the parliament concludes on 23 December 2014. The government had planned to get Insurance Bill and the Coal Mines (Special Provisions) Bill, 2014 passed in parliament during the winter session. The Coal Mines (Special Provisions) Bill, 2014 has been passed in the Lok Sabha, but the Bill is yet to be tabled in Rajya Sabha where the government is in minority. The bill allows the government to enforce rules and guidelines for auction/allocation of 204 coal blocks cancelled by the Supreme Court in September this year. According to media reports, the government is looking at taking the ordinance route for the Coal Bill.
The government may have to wait till the Budget Session of the parliament for the Insurance Bill. It may be recalled that the Parliamentary Select Committee in its report tabled in Rajya Sabha on 10 December 2014 agreed a composite cap of 49% on foreign investment in the insurance sector, which includes all types of foreign investment as opposed to the 26% foreign direct investment (FDI) allowed at present. Finance Minister Arun Jaitley had said in his maiden budget speech in July that the composite cap in the insurance sector should be increased to 49% from the current level of 26%, with full Indian management and control.
A steep slide in global crude oil prices over the past few months augur well for India. Deregulation of diesel price announced by the Indian government in October 2014 and a sharp decline in global crude oil prices over the past few months will help reduce the government's fuel subsidy burden and help contain its fiscal deficit. The steep slide in global crude oil prices will also help India in containing its current account deficit and fuel price inflation. India imports 80% of its crude oil requirement. However, a weakness in rupee against the dollar will restrict the benefit of falling global crude oil prices to that extent. A weak rupee raises the cost of imports.
Meanwhile, a mid-term economic review tabled by the finance ministry in parliament on Friday, 19 December 2014, stated that the backlog of stalled projects needs to be cleared more expeditiously, a process that has already begun. There are stalled projects to the tune of Rs 18 lakh crore (about 13% of GDP) of which an estimated 60% are in infrastructure, according to the mid-term review. The finance ministry also said that adhering to the fiscal deficit target of 4.1% of GDP in 2014-15 is a major challenge. The report stated that the government is committed to meeting the fiscal targets for 2014-15, despite the difficult odds engendered by a combination of factors. A pick-up in economic activity in the second half of the year is critical to prevent a slippage and to meet the overall fiscal deficit target during 2014-15.
According to the fiscal challenges pointed out by the mid-term view, the tax base was weaker than expected, thanks to unanticipated moderation in inflation. The revenue projections were over-optimistic. The budget was unduly burdened by a legacy of carried-over expenditures. Moreover, the deficit target of 4.1% of GDP for 2014-15 represented strongly pro-cyclical fiscal policy-consolidation when growth was below potential.
In Europe, Greece's parliament holds a second vote on Tuesday, 23 December 2014, to choose a new president, with a two-thirds majority required for the election of Prime Minister Antonis Samaras's nominee, Stavros Dimas. Dimas failed to gain enough support in the first round of polls held on 16 December 2014. If the parliament fails to elect a new head of state in three attempts, snap elections will be called that the anti-austerity Syriza party is projected to win.
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