Financial Coffee

(Please click on the Newspaper link to read the full article)   INDIAN ECONOMY DoT wants spectrum in 800 MHz band to be put on sale next year Risks to Financial System Have Increased Since June, Says RBI RBI’s Jan rate cut under cloud New bank capital rules to start in April: RBI SIAM Welcomes Proposal to Hike Diesel Prices INTERNATIONAL ECONOMY Obama Makes Last-Ditch Effort to Avoid ‘Fiscal Cliff’ IPOs Slumps, Since Global Financial Crisis U.S. Stocks Fall for Fifth Day, Treasuries Gain on Budget Spain Alone in Lifting 2013 Bond Sales as Aid Looms Housing Rebound Joined by U.S. Business Activity Pickup Japan’s Production Slumps to 2011 Quake-Aftermath Low: Economy Treasury Plans ‘Extraordinary’ Measures to Avert US Default EQUITY MARKET RBI sees pressure on banks profitability Dalal Street Ends the Week Higher, but All Eyes on US Encore for pharmaceuticals, FMCG outlook cautious DEBT MARKET India Bonds Complete Weekly Gain on Rate-Cut Bets; Rupee Climbs Bond yield eases as higher borrowing fears fade OIS little changed, US 'fiscal cliff' watched Bank deposit growth still sluggish COMMODITIES/FOREX Gold may shine on overnight global gains Oil Fluctuates as Gasoline Supply Rises Amid Fiscal Talks Rising forex inflow may lift Re to 52-53 against $ Canadian Dollar in Tight Range Amid Fiscal Cliff Concern Yuan Sets Tone for Asia as Japan Dethroned by China: Currencies Rupee set to end 2012 with losses despite $24-bn inflows  MUTUAL FUNDS Retail investors lean towards debt, gold ETF schemes HDFC AMC to launch realty fund soon Equity mutual funds' banking sector exposure soars to 20.1% Mutual fund schemes for 2013 INSURANCE Insurers fret at prospect of new mkt highs Bleeding motor insurers find novel ways to stem losses REAL ESTATE Realty sector banks on reforms, economy growth Office space absorption drops 23% in 8 cities: Cushman and Wakefield ‘Residential demand remains strong in NCR Realty set for growth in 2013 OPINION Investment demand will improve in medium term: Apoorva Shah For safeguards in bank licensing Good chance of gold appreciating, say experts KNOWLEDGE CENTER Tax investments should be part of asset allocation policy Draw Up an Investment Strategy with a Long-term View Why ordinary Americans are selling stocks in bull market Things you should consider before buying property for rental income

Fantastic Friday!..Quote of the day

Financial Coffee

(Please click on the Newspaper link to read the full article)   INDIAN ECONOMY Built to last: Brand Tata Painful steps necessary to bring down fiscal deficit: P Chidambaram Manmohan Singh warns against complacency, pitches for hike in prices of petroleum goods, coal & power 12th Plan growth target to be lowered to 8%, says Montek INTERNATIONAL ECONOMY Treasury Plans ‘Extraordinary’ Measures to Avert US Default Wall Street falls for fourth day over 'fiscal' fears Major borrowers to reduce bank deposits: Fed survey US home prices up in October from year earlier France should review 2013 deficit target with EU partners: IMF EQUITY MARKET Encore for pharmaceuticals, FMCG outlook cautious BSE F&O Turnover Hits Peak on Cash Incentive Mid-sized IT Firms See Worrying Signs in 2013 Govt notifies MCX-SX as recognised stock exchange BSE shares soar 50% after bourse decides to go public DEBT MARKET Bond yield eases as higher borrowing fears fade OIS little changed, US 'fiscal cliff' watched Bank deposit growth still sluggish COMMODITIES/FOREX Crude oil mixed in Asia on US fiscal cliff worries Gold dips, focus on US budget talks Oil prices fall on 'fiscal cliff' concerns Gold ends below Rs 31k level on sustained selling, global cues Rupee set to end 2012 with losses despite $24-bn inflows MUTUAL FUNDS Nomura MF seeks to join Rs 10,000 crore club by March 2013 Retail buyers give MFs a pass in 2012 Equity mutual funds' banking sector exposure soars to 20.1% Mutual fund schemes for 2013 INSURANCE IRDA chief differs with finmin over new post Future Generali re-launches health insurance plan Bleeding motor insurers find novel ways to stem losses REAL ESTATE Realty sector banks on reforms, economy growth Office space absorption drops 23% in 8 cities: Cushman and Wakefield ‘Residential demand remains strong in NCR Realty set for growth in 2013 OPINION Investment demand will improve in medium term: Apoorva Shah For safeguards in bank licensing Good chance of gold appreciating, say experts KNOWLEDGE CENTER Draw Up an Investment Strategy with a Long-term View Why investors should consult professional advisors and stick to suggested asset allocation Why ordinary Americans are selling stocks in bull market Things you should consider before buying property for rental income

My Wealth Club's Thirsty Thursday!....Quote of the Day

Financial Coffee

(Please click on the Newspaper link to read the full article)   INDIAN ECONOMY Govt announces more sops to lift exports, extends interest subsidy Govt approves 12 FDI proposals worth over Rs 802 cr Govt to announce new guidelines to revive SEZs by Jan-end RBI proposal may put 70% NBFCs out of business; over 9,000 companies may lose licences 12th Plan growth target to be lowered to 8%, says Montek INTERNATIONAL ECONOMY US home prices up in October from year earlier France should review 2013 deficit target with EU partners: IMF US stocks drop for third day, led by retailers LSE revises buyout offer for LCH.Clearnet  Greece not doing its bit against tax dodgers: EU & IMF EQUITY MARKET Sebi hints at IPO pricing norms Nifty will Scale New Heights, Mid-caps to Sizzle Equities take shine off gold and debt products in 2012 Markets to Remain Volatile Ahead of US Fiscal ‘Cliff-mas’ DEBT MARKET India's 10-year bond yield hits 5-month low, rate cut eyed RBI targets purchases of bonds held by banks, funds Infrastructure companies set to launch tax-free bond issues COMMODITIES/FOREX Gold up in thin post-Christmas trade; US budget in focus Gold demand set to pick up in 2013 on the back of stabilizing prices Government approves 5% jump in wheat MSP for this year How slide in yen can give Toyota an edge over Hyundai Rupee gains against dollar on inflows MUTUAL FUNDS IDBI Mutual Funds garners over Rs 120 crore from 'Gilt Fund' Mid-cap funds outshine benchmarks, may help industry to lure investors Retail buyers give MFs a pass in 2012 Equity mutual funds' banking sector exposure soars to 20.1% Mutual fund schemes for 2013 INSURANCE Non-life insurance business surges 25% Private insurer Max Life Insurance announces special bonus, to distribute Rs 130 crore Life insurance premium income down 1.5% in 2011-12 Life insurance industry's profit doubles to Rs 5,974 cr REAL ESTATE Godrej Properties inks pact with Ratnaraj to redevelop estate Real estate sector: Hopes build up, but no one’s betting on a rebound ‘Residential demand remains strong in NCR Realty set for growth in 2013 OPINION Suparna Karmakar: FDI in retail is much ado about nothing There is a need to put pressure on IPO pricing: U K Sinha Good chance of gold appreciating, say experts KNOWLEDGE CENTER Enhance your health cover to reduce healthcare cost inflation Investment mantra: Are you entitled to returns? Political turmoil vs economic turmoil Understanding Trade Settlement

Call rates stay above repo level on Wednesday

Interbank three-day call rates were trading higher at 8.10/15% against its Monday’s close of 8.05/8.15% as demand remained stable in second week of reporting cycle. However, announcement of Open Market Operation by Reserve Bank of India (RBI) capped the further uptick of the call rates.

Consistent with the stance of monetary policy and based on the current assessment of prevailing and evolving liquidity conditions, the Reserve Bank has decided to conduct Open Market Operations by purchasing government securities for an aggregate amount of Rs 8,000 crore on December 28, 2012.

The banks via Liquidity Adjustment Facility (LAF) borrowed Rs 135,535 crore via repo window on December 26, 2012, while bank by using LAF facility borrowed Rs 150,390 crore via repo window on December 24, 2012.

The overnight borrowing rates touched a high and low of 8.15% and 7.95% respectively.

According to the Clearing Corporation of India (CCIL), the weighted average rate (WAR) in the call money market was 8.08% on Wednesday and total volume stood at Rs 15,033.54 crore, so far.

As per CCIL data, WAR in the CBLO (Collateralized Borrowing and Lending Obligation) market was 8.00% on Wednesday and total volume stood at Rs 16,058.15 crore, so far.

The indicative call rates which closed at 8.05/8.15% on Monday were contributions made from Andhra Bank, AXIS Bank, Bank of America, Bank of Baroda, Bank of India, Canara Bank, J P Morgan Chase, Citibank N.A., Corporation Bank, Credit Agricole Bank, Indusind Bank, ICICI Bank, ICICI Securities, IDBI Bank, Jammu and Kashmir Bank, Punjab National Bank, RBS, Societe Generale, Standard Chartered.

Bond yields edge tad lower on RBI’s announcement of OMO

Bond yields edged tad lower as expectations of a rate cut in January monetary policy and support from consistent bond purchases by the RBI, spurred buying in bonds.

Consistent with the stance of monetary policy and based on the current assessment of prevailing and evolving liquidity conditions, the Reserve Bank has decided to conduct Open Market Operations by purchasing government securities for an aggregate amount of Rs 8,000 crore on December 28, 2012.

On the global front, US 10-year Treasuries held steady in Asian trade on Wednesday, with investors waiting to see whether US lawmakers will reach a last-minute deal to avoid a looming fiscal crunch. Meanwhile, Brent crude rose above $109 per barrel on Wednesday in thin trade as investors clung to hopes US lawmakers would come up with a last-minute deal to avert a looming fiscal crisis in the world's largest oil consumer.

Closer home, the yields on 10-year 8.79% - 2021 were down by 1 basis point to 8.12% from its previous close of 8.13% on Monday.

The benchmark five-year interest rates were trading 1 basis point lower to 7.16% from its previous close of 7.17% on Monday.

The Reserve Bank of India has announced the auction of 364-day Government of India Treasury Bills for notified amount of Rs 5,000 crore each. The auction will be conducted on December 26, 2012 using 'Multiple Price Auction' method.

The Government of India have announced the sale (new/re-issue) of three dated securities for Rs 12,000 crore on December 28, 2012, which includes 

(i) “8.12 percent Government Stock 2020” for a notified amount of Rs 3,000 crore (nominal) through price based auction; 

(ii) “8.20 percent Government Stock 2025” for a notified amount of Rs 6,000 crore (nominal) through price based auction;

(iii) “a new 30-Year Government Stock 2042” for a notified amount of Rs 3,000 crore (nominal) through yield based auction. 

The auctions will be conducted using uniform price method. The auctions will be conducted by the Reserve Bank of India, Fort, Mumbai on December 28, 2012 (Friday).

Wise Wednesday!...Quote of the day

Financial Coffee

(Please click on the Newspaper link to read the full article)   INDIAN ECONOMY Rangarajan proposal to bring relief to ONGC 100% FDI gets green light for rly line projects Predictable investment environment key for India: Russian fund FDI in services sector up 5 pc in April-Oct RBI's 2012 policy rates: What makes Subbarao click? INTERNATIONAL ECONOMY Greece not doing its bit against tax dodgers: EU & IMF SBI, Russian fund to invest $2 bn in projects Israel Bond Yield Drops, After Central Bank Rate Cut Fed Flummoxed by Mortgage Yield Gap Refusing to Shrink: Economy China Foreign Exchange Manager Calls U.S. Global ‘Bright Spot’ Grand arrangemnet Shrinks as Congress Nearing U.S. Budget Deadline Draghi’s Cash Triggers Unprecedented Drop in Bank Lending Stress EQUITY MARKET Sebi hints at IPO pricing norms Nifty will Scale New Heights, Mid-caps to Sizzle Equities take shine off gold and debt products in 2012 Markets to Remain Volatile Ahead of US Fiscal ‘Cliff-mas’ DEBT MARKET Bonds firm up on sustained demand, call rate ends higher Call rates edges higher on tight cash condition Bond yields edge lower on OMO hopes Federal Bank ups deposit rates by up to 0.50% COMMODITIES/FOREX Gold rises for third day on sustained buying, global cues Gold comes under stress from govt & RBI, but continues to shine Rs 80,000 crore Sugar industry saw bumper production this year; sees decontrol in 2013 Top Five Picks for the Upcoming Year Rupee gains against dollar on inflows Rupee sees volatile movements, touches life’s low at June-end Yen Rises From 20-Month Low on Speculation Drop Overdone MUTUAL FUNDS Mid-cap funds outshine benchmarks, may help industry to lure investors Should you opt for the direct plan in mutual funds? Media and entertainment funds do well in past three months Equity mutual funds' banking sector exposure soars to 20.1% Mutual fund schemes for 2013 INSURANCE LIC's  paying claims better than other insurers: IRDA Overall charges capped at 3% of net yield for Ulips of 10 yrs or below Persistent efforts REAL ESTATE Hopes build up, but no one’s speculating on a rebound Real estate trusts may get govt nod to invest in rental property Return on equity for realty development to improve in FY14: Crisil Realty set for growth in 2013 OPINION Suparna Karmakar: FDI in retail is much ado about nothing A ‘Principled’ LIC can Never Go the UTI Way Good chance of gold appreciating, say experts KNOWLEDGE CENTER Enhance your health cover to reduce healthcare cost inflation Investment mantra: Are you entitled to returns? Political turmoil vs economic turmoil Understanding Trade Settlement

Tax Saving & Wealth Creation- My Wealth Club's Recommendation

Dear Investor

We are approaching the end of Financial Year which means that its time to make a tax saving investment. This year www.mywealthclub.com  would like to recommend an investment opportunity which can help you in both Tax Saving & Wealth Creation.

www.mywealthclub.com recommends ICICI Pru Tax Plan which has given consistent performance in the last 5 years. The fund is an Equity Linked Saving Scheme (ELSS) which is eligible for deduction under Section 80C for upto Rs. 1 lac. The features of the fund are as under:

·         Lock in – 3 years

·         Entry and Exit Load – Nil

·         Minimum Investment Amount – Rs. 500

·         Investment Type – 100% exposure in Equity

·         Taxation – Nil. Both Dividend and Capital gain are tax exempt.

·         Suitable for investors whose risk behavior is Moderate or Aggressive

·         Recommended Time horizon – 5 Years

·         Expected Return – 15% per annum. Current market conditions are very favorable for good performance in next 5 years.

·         Expense Ratio – One of the lowest among various Tax Saving Products.

Past Performance Analysis of the Fund :

               

Scheme	Corpus (Crores)	LaunchDate	1Y	2Y	3Y	5Y
ICICI Pru - Tax Plan (G)	1362	9-Aug-99	36.68	3.68	10.46	5.38
SBI - M Tax Gain (G)	4648	7-May-07	35.13	2.82	6.31	0.65
HDFC - Tax Saver (G)	3223	31-Mar-96	25.99	-0.56	8.07	4.41
Reliance - Tax Saver (G)	1993	25-Jul-05	47.12	5.8	12.13	4.47
Sundaram - Tax Saver (G)	1377	5-May-05	32.35	1.45	5.29	1.68
Franklin - India Taxshield (G)	853	10-Apr-99	29.27	5.24	11.56	5.3

                *Returns are annualized.

                **As on 21/12/12

Comparison with other Tax Saving Options:

Instruments	Lock-in Period (years)	Risk Level	Returns - CAGR	Minimum investment (Rs)	Tax status on maturity
ICICI Pru Tax Plan (ELSS)	3 Years	High	Market Linked	500	Tax free
Public Provident Fund (PPF)	15 Years	Low	8.8	500	Tax free
National Savings Certificate (NSC)	5 Years	Low	8.6	100	Taxable
Bank Fixed deposits	5 Years	Low	9	10000	Taxable
Unit Linked Insurance Policy (ULIP)	5 Years	High	Market Linked	10000	Tax free

Offer from mywealthclub.com:

We are giving 16GB Pen Drive free of cost to all the investors who make a Tax Saving Investment through us.

Please let us know if your interest builds on the above recommendation.

Best Regards 

Mywealthclub.com

1154, 11^th Floor, Tower B2,

Spaze I Tech Park, Sohna Road,

Gurgaon-122018 , Haryana, India.

Ph:      +91 124 4246036, Fax: +91 124 4246037,Mobile: +91 9582415190

Email: support@mywealthclub.com