Trade cautiously- koolfriend4u
The government has set reform of the insurance sector as a priority for the winter parliament session that begins today, 19 November 2009. The bill, which was stalled in the last parliament, proposes raising the foreign investment limit in insurance companies from 26 % to 49 %.The government also wants to open up the pension sector to private and foreign firms and give equal voting rights to foreigners in private-sector banks, which are currently limited to 10 % irrespective of their actual holding. Prime Minister Manmohan Singh said recently India is ready to increase the pace of reform, and the government has flagged stake sales in state firms and tax changes to help to plug a large budget deficit.
The government kicked off the discussion process towards consolidation in the banking sector at a meeting with senior bankers on Wednesday. The finance ministry has been urging banks since the last few years to start the process of mergers and acquisition on a voluntary basis, but none of the state-run banks have shown any initiative on this.
Meanwhile, the government is taking its first significant step to ward off a surge in foreign capital inflows that may threaten the stability of the financial system by drawing up new rules that will make overseas loans costlier for companies. The government is finalising plans to auction corporate entitlements to borrow abroad, a pre-emptive move relaying the message that the country is determined not to allow unruly capital inflows to disrupt the incipient economic recovery.
Finance Minister Pranab Mukherjee said on Wednesday the country is monitoring foreign capital inflows and the current higher inflows are not a matter of concern. Indian stocks have risen sharply this year on robust inflow from foreign funds. Indian officials had said on recent occasions that they welcomed fund inflows, but Mukherjee on Wednesday also noted that India is ready to deal with the flows if they become a problem. We have a system of monitoring inflows, he said.
Already I have sent mail to all my friends -to trade cautiously & exit all longs here partially.if there any breakout above 5100 rest of the stocks.
Things may change overnit!
Regards
JK