India shares hit new high, beating January 2008 peak

India shares hit new high, beating January 2008 peak
Updated 28 December 2013

India shares hit new high, beating January 2008 peak

India shares hit new high, beating January 2008 peak

MUMBAI: Indian shares jumped to their highest-ever trading level, beating the previous record set in 2008, fueled by strong foreign fund inflows and an easing of both global and domestic economic concerns.
The Bombay Stock Exchange benchmark Sensex hit a new high of 21,293.88 points in morning trade on Dhanteras day, part of the five-day festival of lights called Diwali.
The index's previous intraday record high was 21,206.77 points on January 10, 2008.
The Sensex retraced later on profit taking to end at a new record close of 21,196.81 points.
Sentiment has been improving across Asian markets over hopes that the US central bank may delay plans to start tapering its massive stimulus programme.
India's market has been sluggish for most of 2013, due to an outflow of foreign funds over fears of an end to the US program, while the country's slowing economic growth, weak rupee and high trade deficit also weighed.
But with global and domestic fears beginning to ease, investments are starting to flow in again.
Foreign funds pumped $2.55 billion into Indian equities in October, taking their total purchases to $16.48 billion for 2013, regulatory figures showed.
"This rally has been fueled by an avalanche of global liquidity into emerging markets, after the reprieve by the US Fed as far as the US tapering plan goes," said Ajay Bodke, head investment strategist with Mumbai brokerage Prabhudas Lilladher.
Local sentiment has improved as several Indian firms, including IT and auto giants, have reported better-than-expected earnings data for the September-ended quarter.
India's Finance Minister P. Chidambaram Friday warned investors against "excessive exuberance" despite being confident that the country's current account deficit may narrow, as exports improve and investments into India rise.
"The markets seem to be happy but I would caution investors against excessive exuberance," Chidambaram told reporters in New Delhi.
Chidambaram said he was confident that India's current account deficit — the broadest measure of trade — could be contained at $60 billion this fiscal, from an earlier figure of $70 billion.
The appointment in September of renowned economist Raghuram Rajan as India's new central bank governor also appears to have helped sentiment, analysts say.
Rajan, a former International Monetary Fund chief economist, has outlined a plan to boost investor confidence, fight high inflation and support the ailing rupee.
The rupee, which was one of the worst performing Asian currencies this year, has started to stabilise, gaining more than 10 percent against the dollar from its record low of 68.85 in August.
Rajan has been hawkish in his stance on inflation, which remains above the bank's comfort levels, by raising interest rates in his two monetary policy meetings since taking office.
India's annual inflation jumped to a seven-month-high of 6.46 percent for the month of September, led by surging food and fuel prices.
But analysts such as Bodke hope that consumer prices could start to ease soon, thanks to a good monsoon, giving the central bank room to cut rates and spur growth, something business leaders have been calling for.
India recorded five percent growth last year, the slowest in a decade, and far below the levels of eight to nine percent that it enjoyed in recent years.
Economists remain concerned that the rupee, though stable now, may come under pressure in coming weeks when the central bank eventually ends a temporary facility it opened to sell dollars directly to state-run oil firms.
Fears of fresh outflows once the US Fed commences tapering off its stimulus programme also remain.
"I would call this an illusionary rally. There are some roadblocks ahead in terms of valuations and economic fundamentals," said Jigar Shah, India's head of research for Kim Eng Securities.
The Congress party-led government of Prime Minister Manmohan Singh is anxious both to tame inflation and to revive the economy as it seeks a third term in office, with elections due by next May.
Foreign investors are eyeing the 2014 elections with hopes that a new government could announce more plans to boost reforms and investments into key areas such as infrastructure and banking.


Saudi non-oil sector’s expansion continues

Saudi non-oil sector’s expansion continues
Updated 29 min 46 sec ago

Saudi non-oil sector’s expansion continues

Saudi non-oil sector’s expansion continues
  • Rising demand from domestic, overseas clients supported upturn: Survey

RIYADH: Non-oil business activity in Saudi Arabia maintained a sharp pace of expansion in July, despite slowing for the second month running, according to a survey released on Tuesday. 

Output grew at a sharp pace, underlined by a robust increase in new business inflows, but still staff levels rose only fractionally in July as firms continued to signal an excess of business capacity despite rising sales.

Rising demand from domestic and overseas clients supported the upturn, which some firms linked to competitive pricing strategies.

The seasonally adjusted IHS Markit Saudi Arabia Purchasing Managers’ Index (PMI) fell for the first time in four months to 55.8 in July, from 56.4 in June, due to weaker growth in output, new orders and employment compared to the previous month. 

Employment prospects were also harmed by a drop in future output expectations to the joint-weakest for more than a year, despite the strong improvement in operating conditions that extended the current run of growth to 11 months.

Hiring growth weakened to a fractional pace, as only few firms reported needing additional staff and backlogs were reduced solidly, suggesting a wide gap between demand and full capacity in spite of a sharp increase in new orders in recent months

“While Saudi Arabia’s PMI continued to signal strong growth in the non-oil economy in July, our survey data related to business capacity highlighted that challenging economic conditions prevailed,” said David Owen, an economist at IHS Markit.

“Firstly, employment growth slowed to only a marginal pace, suggesting that many companies still have little need for new hires in spite of a sharp rebound in new orders. Secondly, backlogs of work fell at the second-quickest pace for a year, adding further evidence that businesses have yet to reach pre-pandemic levels of capacity utilization,” he said.

“Sustained rises in demand should help the economy move closer to full capacity over the second half of the year. However, a drop in business expectations to its joint-weakest since June 2020 illustrated growing doubts that this will be a smooth ride,” he said.

Nearly 27 percent of surveyed businesses reported an increase in activity, linked to strengthening client demand and a loosening of pandemic-related measures.


SABIC set to announce Q2 financial results

SABIC set to announce Q2 financial results
Updated 35 min 38 sec ago

SABIC set to announce Q2 financial results

SABIC set to announce Q2 financial results

JEDDAH: The Saudi Basic Industries Corp. (SABIC) said that it will hold a virtual press conference to review the financial results for the second quarter of 2021 on Thursday.

Yousef Al-Benyan, SABIC vice chairman and CEO, will attend the conference.

Based on the data available on Argaam news website, analysts predict profits of SR6.4 billion ($1.7 billion) compared to SR2.2 billion losses in the second quarter of 2020.

SABIC is seeking to become the largest petrochemical company in the world by 2030. 

The petrochemical industry in the Kingdom has a significant impact as it contributes more than SR260 billion annually to the gross domestic product (GDP), representing 36 percent of the industrial GDP and more than 57 percent of non-oil exports.


Startup of the Week: Skil Studio; Perfecting the art of marketing, designing

Startup of the Week: Skil Studio; Perfecting the art of marketing, designing
Updated 26 min 18 sec ago

Startup of the Week: Skil Studio; Perfecting the art of marketing, designing

Startup of the Week: Skil Studio; Perfecting the art of marketing, designing

JEDDAH: Zakaria Ahmad owns a digital design agency called Skil Studios focused on identity building, graphic designing, and social media content building.

“We were working with another company but recently started our own business,” said Ahmad.

The entrepreneur is grateful for the customers who trust them with the design and layout.

Their services start with designing the identity that represents their clients, then services such as digital marketing, e-commerce, and social media content development are also offered. Sometimes the business also offers videography and photography services.

The company’s founder said that most companies here focus more on quantity rather than quality. He said his company’s goal is to start an agency that cares about its clients and has their best interest in mind.

“We appreciate art in everything,” Ahmad said. He believes marketing and identity building is an art and his company seeks to achieve the target with perfection.

He said that they want to offer something new. Ahmad said his team does not believe in “copying and modifying already existing designs,” instead they want to introduce the latest global trends in the Middle East without compromising on their uniqueness.

He admitted that the business faced quite a few challenges along the way, which is usual for a startup.

“We were looking for talented people with a passion for designing and art to help us achieve our goals,” Ahmad said.

Ahmad is most proud of his company’s identity and the trust that his team has built with clients due to their sincere efforts.

He said members of the creative team ensure they understand the requirement of clients and deliver them whatever their demands are.


WEF leader urges countries to ‘pay close attention’ to digital currency

WEF leader urges countries to ‘pay close attention’ to digital currency
Updated 03 August 2021

WEF leader urges countries to ‘pay close attention’ to digital currency

WEF leader urges countries to ‘pay close attention’ to digital currency
  • The Asian superpower recently announced it will allow foreign visitors to use digital yuan in the upcoming Winter Olympics

DUBAI: Digital currency is going to play a big role in the global economy, a World Economic Forum (WEF) committee leader said, and nations need to pay attention to its unprecedented progress.

“Somebody needs to be paying close attention to this space, and assessing on a weekly basis, what the national policy ought to be regarding digital currencies,” Sheila Warren, deputy head of the Centre for the Fourth Industrial Revolution (C4IR) committee of WEF, told Arab News.

Digital currency will continue to evolve, she said, adding some nations have already started investigating its effect on their own economies.

“We’re going to see a variety of offerings in the digital currency space — central bank digital currency, stable coin issuances, and cryptocurrencies including Bitcoin,” Warren explained.

According to Atlantic Council, which tracks central banks’ participation in the space, 81 countries have already explored a digital currency with China leading the pack.

The Asian superpower recently announced it will allow foreign visitors to use digital yuan in the upcoming Winter Olympics.

Other major central banks in the race are the US Federal Reserve, the European Central Bank, the Bank of Japan, and the Bank of England.

In the Gulf, Saudi Arabia and the UAE previously said they were working jointly on a digital currency plan — they called the initiative “Project Aber.”

The two countries aim to develop a cross-border payment system that will reduce transfer times and costs between banks.

Although every nation doesn’t necessarily have to “immediately jump in,” Warren said it is important to watch the evolution of the industry.

“If you're not doing that, you're going to be stuck, I think, with whatever the world decides, the direction of travel is going to be, and not have enough opportunity to help shape that,” she explained.

On decentralized cryptocurrencies, including bitcoin, Warren said it will continue to have a huge role in the global economy as well.

“We’re going to see an increase in market cap, an increase in market share of the suite of digital currencies,” she said.

The private sector will take advantage of this by developing some of a blockchain or distributed ledger, she added.


Tunisians hope for better times ahead

Tunisians hope for better times ahead
Updated 03 August 2021

Tunisians hope for better times ahead

Tunisians hope for better times ahead
  • The proceeds from selling the plastic, combined with limited financial assistance from the government

TUNIS: As day breaks over Tunis, Jamila Ghuili takes her two small children out into the streets to scavenge in waste bins for plastic bottles that she sells to buy food for her family.
Abandoned by her husband, the single mother lives in a poor part of Omrane Superieur, a neighborhood of the capital where Tunisia’s economic malaise is acutely felt.
“Everything has become expensive,” said Ghuili, as her children played next to her.
Exacerbated by the repercussions of the COVID-19 pandemic, economic grievances have fueled discontent in Tunisia, leading to protests that encouraged President Kais Saied to remove the prime minister and assume governing authority last month.
Ghuili, 55, gathers a few kilograms of dirt-covered plastic each day, foraged from heaps of garbage dumped at the roadside.
The proceeds from selling the plastic, combined with limited financial assistance from the government, amount to 190 Tunisian dinars ($69) a month, around half her monthly rent.
Hamza Ayari, who buys the bottles and re-sells them to factories, says many people are doing the same. “They don’t have any other job, they are poor people,” he said.
Desperate for better lives, some of Omrane Superieur’s residents are hopeful about Saied’s move.
“I salute the people who voted for him, he is a good person,” said Fakhreddine Wannas, 56, a resident. “I hope he can take us out of the dark and into the light.”
It echoes sentiment expressed by other Tunisians who are fed up with political bickering and want to see an improvement in the economy — which shrank by 8.8 percent last year — and more effective action against COVID-19.
Saied, who was elected in 2019, says he will not become a dictator and that the actions he took on July 25, including the 30-day suspension of parliament, were constitutional. He has yet to set out next steps.
Soumaya, who paints henna tattoos for a living, expressed relief about the situation, saying that for a long time Tunisians did not know where they were heading. “Now we are all happy,” said Soumaya, as she painted a child’s hand.