The government is seeking a vote of confidence in parliament in a special two-day session of the parliament starting today after it was reduced to minority following withdrawal of support of Left parties early this month. Voting will take place tomorrow. Media reports suggest that the government has wafer-thin edge of winning the trust vote.
A section of the market reckons that the government may push forward economic reforms if it survives the vote of confidence in parliament. There has been a virtual halt in reforms process in the last four years due to strong opposition to reforms from Left parties. Left parities had stalled privatisation of state-run firms, pension reforms, higher foreign limits in insurance and more liberal norms for foreign bank.
Asian stocks rose sharply on Monday, 21 July 2008, helped by a smaller-than-expected loss at Citigroup that provided comfort about the financial sector's stability ahead of more results this week from banks and industrial companies. Key benchmark indices in Hong Kong, China, South Korea, Singapore and Taiwan were 1.4% to 3.4%. Markets in Japan were closed for a public holiday,
A sharp fall in crude prices from a record high of above $147 a barrel and a good amount of buying by foreign funds which had pressed heavy sales over the past few weeks, triggered a solid rebound on the bourses late last week. The barometer index BSE Sensex jumped 1059.60 points or 8.42% to 13,635.40 on Friday, 18 July 2008 from its close of 12575.80 on 16 July 2008
Crude prices edged up today from late New York levels but remained below $130 a barrel as talks between world powers and nuclear ambitious Iran, the fourth largest oil exporter, proved inconclusive.
Meanwhile, a cause for concern on the inflation front is the uneven distribution of rains in this monsoon season so far which has raised concerns about some kharif crops. Though the Indian Meteorological Department (IMD) has estimated the cumulative monsoon rainfall till 15 July 18, 2008, at 6% above normal, rains have been scanty in southern peninsula, Maharashtra and parts of Gujarat and Rajasthan.
With inflation hovering at highest level in more that 13 years, the Reserve Bank of India (RBI) is expected to further tighten the monetary policy.
As per provisional data released by stock exchanges after trading hours, foreign funds on Friday, 18 July 2008, bought shares worth a net Rs 408.21 crore. Foreign funds purchased worth a net Rs 535.80 crore on Thursday, 17 July 2008, data released by market regulator Securities & Exchange Board of India (Sebi) after trading hours on Friday, 18 July 2008, showed.
US stocks finished mixed on Friday, 18 July 2008. Favorable results from No. 1 US bank Citigroup and technology leader IBM drove the Dow Jones Industrial Average higher, but the Nasdaq fell on disappointing results from tech icons Google and Microsoft. The Dow closed up 49.91 points, or 0.44%, at 11,496.57. The Standard & Poor's 500 Index added 0.34 points, or 0.03%, at 1,260.66. The Nasdaq Composite Index fell 29.52 points, or 1.28%, at 2,282.78.