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In a chat with ET Now, BP Singh, ED & CIO, Equities of Pramerica Mutual Fund, shares his views on the markets. Excerpts: ET Now: What is the current allocation in your portfolio? In this decline, where are you buying and selling? BP Singh: When IT corrected in the decline, we had added since we were sitting on an underweight position on IT. Otherwise we are using the FMCG and pharma sectors as fund source to get into private banks and some of the capital goods sectors, particularly road construction, the various auto ancillary units, etc. We are preparing ourselves for a better monsoon season, a lower interest rate scenario and capex pick up in the economy. Accordingly, those are the sectors where we are increasing our weightage. Economics Times Sent from BlackBerry® on Airtel

Banks' credit down 2.91% Credit in the banking system has declined by 2.91 per cent from the start of this financial year (April 1). According to the Reserve Bank of India data, bank credit fell from Rs 68,30,965 crore at the end of April 3 to Rs 66,32,101 crore by the end of May 15. In the same period, deposits also declined by 1.92 per cent However, credit in the system grew 10.16 percent at the end of May 15 as compared to the corresponding period a year earlier. Deposits in the same period inched up 11.8 per cent. With credit demand in the banking system continuing to remain sluggish, credit growth has been hovering either in single digits or the low double digit range. Reflecting an economic slowdown in the country, the pace of growth in bank credit slowed to 9.52 per cent in 2014-15, compared with 13.83 per cent in 2013-14. Bankers believe credit growth has continued to remain under pressure due to slowdown in the corporate segment of the business. Those in ...

The following are the salient features of the proposed pan-India Goods and Services Tax regime that was approved by the Lok Sabha by way of an amendment to the Constitution: 1. GST, or Goods and Services Tax, will subsume central indirect taxes like excise duty, countervailing duty and service tax, as also state levies like value added tax, octroi and entry tax, luxury tax. 2. The final consumer will bear only the GST charged by the last dealer in the supply chain, with set-off benefits at all the previous stages. 3. As a measure of support for the states, petroleum products, alcohol for human consumption and tobacco have been kept out of the purview of the GST. 4. It will have two components - Central GST levied by the Centre and State GST levied by the states. 5. However, only the Centre may levy and collect GST on supplies in the course of inter-state trade or commerce. The tax collected would be divided between the Centre and the states in a manner to be pro...

〽arket 〽⭕⭕D as on 27-May-2015 provisional @ 6:10 pm BSE Sensex: + 33 (27565) 🔼 NSE Nifty: - 5 (8335) ↔ BSE midCap + 7 (10616) ↔ BSE smllcap - 3 (11163) ↔ Fii Derivatives N.A. Fii investment - 935 Crs 😩 Dii investment + 594 Crs 😊 Brent Crude 63.63 $/brl 🔽 Gold $/oz 1186 & Rs/10gm 26890 ↔ Silver Rs./kg 38439 🔽 8.40-GS-2024 / 10 Yr ytm 7.87% 🔽😜 7.72-GS-2025 / 10 Yr ytm 7.67% (New Benchmark)↔😜 ForeX: Rs. / us $ 64.01 🔽😩 Sent from BlackBerry® on Airtel

RBI to watch for monsoon onset before softening rates further India has emerged as a bright spot in the otherwise gloomy world economy in the last one year. Investment climate in general has improved with the government proactively taking measures to ease legal & bureaucratic processes, and enhance coordination among different stakeholders. The government has done remarkably well in lifting morale of public servants. Recent coal block and telecom spectrum allocations are good examples of transparent and accountable service delivery. Further, a record 150 million new banking accounts have been opened with the prime minister's Jan Dhan Yojana, making 99.99 per cent of Indian households financially connected. Advertisement The government is now harnessing this platform to provide universal social security at very affordable cost for common citizens of the country. On macro front, with current account deficit, fiscal deficit and inflation - all three persistent vulnerabilities - ha...

Health insurance customers may soon have to loosen their purses to pay premiums, if a proposal by an expert committee on health insurance is accepted. This committee has recommended that health premiums increase per year be linked to consumer price inflation and that it is should be CPI plus 3 per cent. This would lead to additional hikes since presently health policy premiums increase only after three years. The expert committee has said that the CPI+3 formula would be a cap and an insurer can increase up to this limit. It said that any higher increase would require the Authority's approval. Consumer Price Index (CPI)-based inflation for April stood at 4.86 per cent, the lowest in four months, on the back of another month of declining food prices, data by the Central Statistics Office showed. Consumer Food Price Inflation (CFPI) for April was 5.11 per cent, against 6.14 per cent in March and 9.21 per cent in the year-ago period. "The health inflation at present is almost 16-1...

After pouring in the largest sum in shares at the start of the current financial year, India's fund managers have reduced their pace of investment in stocks. Industry experts say it's tactical call and not a directional one. They add that it is a continuation of "buy on dips" strategy. Thus far this month, in the 16 trading sessions, equity fund managers have net invested about Rs 3,300 crore - which is nearly a third of what the previous month witnessed. Compared to the immediate previous month, the quantum of net investment is low but is in line with the average monthly investments ever since the Narendra Modi-led BJP government took office in New Delhi last year. Three more trading sessions are yet to come in May. In April, the net investment stood at Rs 9,244 crore, which was unusually high given the robust inflows as key indices corrected about 10%. According to fund managers, it is a tactical call and should not be read as directional. It has come at a time when...

In an interview with ET Now, Kenneth Andrade, CIO, IDFC Mutual Fund, shares his views on markets. Excerpts: ET Now: There is a section in the market which believes that the economic recovery in the first year of the current administration is slow. Is the criticism valid? Are you also disappointed, given the fact that earnings are yet to pick up? Kenneth Andrade: I think it was too early to expect earnings to pick up. Whatever this government has done is left on implementation, but corporates have to follow through. ET Now: So how will the second year of the government be different from the first? Kenneth Andrade: As far as investment world is concerned, we look at the policy initiatives and we see how corporates follow them up. They do not have the balance sheet to follow it up. So, 2016 is not going to be very different from what you saw in 2015. And going into 2017, we need to see how demand actually picks up. So, capacities are there on the ground. They got created over the last 10 ...

Don't switch out of debt funds We have been recommending the long-dated debt fund strategy for some time now. While it has generated handsome returns in the past, conditions are not rosy for investors who got in only in the last three months. Income funds have generated absolute returns of only 0.97% in the last three months while the average longand medium-term gilt fund has lost money . So what went wrong? After falling for more than 18 months, the 10-year yield remained almost flat the last three months before starting to inch up in the last few days. The 10-year yield is now placed at 7.87%, 22 bps higher than the recent low of 7.65% on 2 February . To find out where the yield is headed, we need to take a look at the factors that contributed to its recent spurt. First, the spurt in crude prices from its recent lows has raised doubts about the low inflationary situation in India.Brent crude is at $69 per barrel, a more than 40% jump from its January low.However, experts think th...

Mutual Funds exposure to bank stocks climbs to Rs 75,000 cr Mutual Fund managers have been on a shopping spree of bank shares as they have raised their allocation in the sector to about Rs 75,000 crore in April anticipating a rate cut by the Reserve Bank. In comparison, equity fund managers' deployment in banking stocks stood at Rs 41,104 crore in April 2014. According to the industry experts, fund managers have raised their allocation to bank stocks expecting a rate cut by the RBI. They said that fund managers cannot take a bearish call on banking stocks, given the high weightage attached to the index. As per the data available from Securities and Exchange Board of India (Sebi), overall deployment of equity funds in bank stocks stood at Rs 74,810 crore in April compared with Rs 73,575 crore in the previous month. Besides, exposure to banks was at 20.7 per cent against 20.42 per cent in the preceding month. The BSE bankex index inched up 0.8 per cent in A...

     

  In the recent past, most of the diversified equity funds have posted encouraging returns. Please refer our attached note on the subject wherein we explained the contribution of mid caps in boosting scheme performance of diversified equity funds in general. However, with huge divergence in performance of Nifty and Mid cap index and convergence in valuation, we believe that next leg of the rally shall be driven by large caps and hence there is a case to increase allocation to large caps. Most of our diversified equity funds are now overweight on large caps and hence positioned to capture next leg of rally. To summarise, we expect large caps performing better than mid caps over medium term. However, key to financial success remains asset allocation. Looking forward to your feedback and comments on the subject and appreciative of your continual support.       Rajesh kathpalia        

Mutual fund managers pumped in over Rs 22,000 crore in the debt market in April, mainly on account of positive investor sentiments and the government's reforms agenda. In comparison, they have invested a net amount of Rs 9,244 crore in the stock markets. Moreover, mutual fund houses are upbeat about overall inflows in equities and debt markets for the current financial year (2015-16) as well. Industry experts have attributed the inflows in debt markets during 2014-15 to the new government's reforms agenda, improved fundamentals of the domestic economy and increased participation from retail investors. "Improved sentiments and the reforms initiative taken by the the Central government has helped in the inflow," Axis Mutual Fund Managing Director and CEO Chandresh Nigam said. As per data released by the Securities and Exchange Board of India, mutual fund managers invested a net sum of Rs 22,650 crore in the debt markets in April. Besides, fund managers...

RBI sets cut off yield for new 10-year bond The Reserve Bank of India (RBI) on Friday set the cut off yield for the new 10-year bond at 7.72%, lower than the 7.88% close of the 10-year bond on Thursday. The RBI raised Rs.9,000 crore by selling the new benchmark bond on Friday. "The cut off is in line with what the market expected. It is normal for the yield to soften about 15 to 20 basis points (bps) when the new benchmark becomes effective because of the demand for that security. Going forward I expect the 10-year bond yield to have a softening bias with the yield trading in the 7.65% to 7.70% range ahead of the monetary policy review," said Bansi Madhavani​, a fixed income and macroeconomic research analyst at Securities Trading Corp of India. RBI will announce its next bi-monthly monetary policy review on 2 June. LIvemint Sent from BlackBerry® on Airtel

The Reserve Bank today relaxed norms to help Indian corporates to raise funds in rupees from overseas lenders. To facilitate external commercial borrowing (ECB) in rupees, RBI said off-shore lenders may enter into swap transactions with their overseas bank which in turn will enter into a back-to-back swap transaction with a bank in India. Earlier, a non-resident ECB lender was allowed to extend loans in rupees provided the lender mobilises rupees through a swap undertaken with a bank in India. For the purpose of executing swaps for ECBs denominated in rupees, the ECB lender, "if it desires, may set up a representative office in India," it added. Also, the continuation of the swap will be subject to the existence of the underlying ECB at all times. The RBI further said a KYC certification on the end client should also be taken by the bank in India as a one-time document from the overseas bank. Meanwhile, speaking at an event in New Delhi, RBI Deputy Gov...