Financial focus Weekly Newsletter

InFINeeti

ISSUE 2 2014 Volume 2

TOP STORIES…………….1 MARKET ACTIVITY…..….2

ECONOMICS.………....….3

TERM OF THE WEEK ….. 4 POLICY RATES AND

MARKET UPDATES….….. 5

WARREN BUFFETT

MANAGEMENT RULES…. 5

A o n e s t o p g u i d e t o k n ow a b o u t a l l t h e r e c e n t h a p p e n i n g s i n t h e f i n a n c i a l w o r l d

TOP STORIES : INDIA

INDIA STOPS HISTORY FROM BEING MADE AT WTO, DIPLO-MATS EXPRESS SHOCK

Several member states of the World Trade Organisation (WTO) voiced frus-tration after India's demands for concessions on agricultural stockpiling (food security) led to the collapse of the first major global trade reform

pact in two decades. Read more...

Financial focus

SAHARA GROUP'S SUBRATA ROY GETS RELIEF, SC CLEARS SHIFT FROM LOCK-UP TO TIHAR JAIL HALL

In a reprieve to the Sahara group, the Supreme Court on Friday allowed shifting of its chief Subrata Roy from lock up to a conference hall in Delhi's Tihar jail complex to facilitate business negotiations.

A bench led by Justice T S Thakur permitted this arrangement for 10 work-

ing days, starting from August 5. Read more...

AMAZON INFUSES $2 BILLION INTO INDIAN ARM, A DAY AF-TER FLIPKART ANNOUNCED $1 BILLION FUNDING

Flipkart announced that it raised a fresh round of funding worth $1 billion. This is seen as a part of Flipkart's aggressive scale up after Amazon's rapid expansion in India that has heated up competition.

Now a day later, Amazon announced that it will invest an additional $2 bil-lion "to support its rapid growth and continue to enhance the customer and

seller experience in India." Read more...

Financial focus Weekly Newsletter

InFINeeti

FIIS OWNERSHIP HITS 2 YEAR HIGH IN 22 NIFTY STOCKS IN JUNE QUARTER

Post the change in government, a high amount of cash influx by FIIs have been observed. More than 25% stake in the top 21 stocks comprising the NIFTY have been their composition, and 22 stocks being running at an all time high. Read more...

OIL SLIPS BELOW $106 ON INCREASED SUPPLY, LOW DE-MAND

Reduced demand and higher OPEC output resulted in the oil price reducing below $103. Brent crude’s so occurred were to the highest post April ’13. With the dollars hitting a 10-month low, currency situations are not fa-

vouring the oil prices. Read more...

TOP STORIES : WORLD

IMF LOWERS GLOBAL GROWTH FORECAST

International Monetary Fund (IMF) has lowered its forecast for global eco-nomic growth from 3.7% to 3.4%,according to its latest “World Economic Outlook” report. The main reason for downward revision was a weak first quarter by major economies and several emerging markets. According to the report, the United States suffered from a biting winter and excess invento-ries, while attempts to rein in credit growth in China have dented demand.

Read more...

RUSSIA'S SURPRISE INTEREST RATE RISE 'TO CURB INFLATION'

Russian Central Bank has increased its key bank interest rate by 50 basis points to 8% per year. The bank’s board took this decision to ease the infla-tionary pressure on Russia’s economy. “Geopolitical tension” could be an-other main reason for the hike. Stocks and the rouble tumbled earlier this year after sanctions were implemented. In June, core inflation grew to 7.5%,

well above the bank's forecast of up to 6.5% for the year. Read more...

THE BRICS DEVELOPMENT BANK CAN RELEASE AFRICA FROM WORLD BANK TYRANNY Leaders from BRICS countries have signed a treaty in the Brazilian city of

Fortaleza to launch a Brics development bank. The bank will rival the US-

and European-led World Bank and its private lending affiliate, the Interna-

tional Finance Corporation. This bank would be instrumental in giving finan-

cial assistance to the developing countries minus the punishing strings

attached to World Bank lending. Read more...

MARKET ACTIVITY

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InFINeeti

RBI CREDIT POLICY: RAJAN MAY KEEP KEY RATES UNCHANGED, SAYSCNBC-TV18POLL If Reserve Bank governor Raghuram Rajan’s intention was to make the central bank be seen as an inflation fighting machine, he appears to have succeeded. Our CNBC-TV18 poll showed that despite a clear fall in the CPI in June, 100 per-cent of the respondents polled don’t see the governor cutting rates on August 5

monetary policy. Read more...

ECONOMICS

Q1 FISCAL DEFICIT CROSSES 56% OF ESTIMATE

Fiscal deficit in the April-June quarter crossed 56% of the Budget estimates of the entire 2014-15 mainly due to slow revenue collections and a steady rise in non-Plan spending, Controller General of Accounts data showed on Thursday. The deficit in the first quarter amounted to Rs 2.98 lakh crore, or 2.3% of GDP. The Budget target for the fiscal deficit for the full year is Rs 5.31 lakh

crore, or 4.1% of GDP. Read more...

FACTORIES POST FASTEST GROWTH FOR 17 MONTHS IN JULY

India's factory activity expanded at its fastest pace in 17 months in July as firms responded to burgeoning new orders by increasing output even as input prices jumped sharply, a business survey showed on Friday.

The HSBC Manufacturing Purchasing Managers' Index (PMI), compiled by Markit, rose to 53.0 in July from 51.5 in June, its highest since February

2013. A reading above 50 separates growth from contraction.Read more...

RETAIL INFLATION FOR INDUSTRIAL WORKERS EASES TO 6.19 PER CENT IN JUNE

Retail inflation for industrial workers eased to 6.19 per cent in June com-pared to 7.2 per cent in May on account of softening of prices of foods items. The year-to-year inflation based on CPI-IW decreased from 7.2 per cent in May to 6.19 per cent in June 2014 against 11.6 per cent in June 2013,

sources said. Read More...

INDIA RANKS SECOND WORLDWIDE IN FARM OUTPUT India ranks second worldwide in farm output. India is the largest producer

of milk, jute and pulses in the world.

Source::http://www.rediff.com/business/slide-show/slide-show-1-special-25-interesting-facts-you-must-know-about-the-indian-economy-/20130808.htm#10

DID YOU KNOW ?

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TERM OF THE WEEK

COLLATERALIZED MORTGAGE OBLIGATION (CMO)

WHAT IS COLLATERALIZED MORTGAGE OBLIGATION?

Collateralized mortgage obligations are complex financial instruments. Each CMO tranche can have different principal balances, interest rates, maturities and repayment risks. They are sensitive to interest rate changes as well as changes in economic conditions, such as foreclosure rates, refinance rates and the rate at which properties are sold. Investors in CMOs look to obtain access to mortgage cash flows without having to originate or purchase a set of mortgages themselves. Organizations that purchase collateralized mortgage obligations include hedge funds, banks, insurance companies and mutual funds. The use of collateralized debt, such as collateralized mortgage obligations and collateralized debt obligations, has been criticized as a precipitating factor in the 2007-2008 financial crisis. Rising housing prices made mort-gages look like attractive investments, but market and economic conditions led to a rise in foreclosures and payment risks that financial models did not accurately predict. Because CMOs were complex and involved many different mortgages, investors were more likely to focus on income streams rather than the health of the underlying mortgages themselves. The first CMO was created by two banks, Salomon Brothers and First Boston, for Freddie Mac in 1983.

Source :- http://www.investopedia.com

RESULT OF FEW MAJOR COMPANIES-STOCK PERFORMANCE

-15.00%

-10.00%

-5.00%

0.00%

5.00%

10.00%

15.00%

20.00%

25.00%

Maruti Suzuki NTPC HCL Tech ICICI PVR

YoY Revenue Increase

Share Price Increase

Financial focus Weekly Newsletter

InFINeeti

InFINeeti Team

POLICY RATES AND MARKET UPDATES

DATE :- 02/08/2014

WARREN BUFFET MANAGEMENT RULES : RULE 3 & 4 RULE 3 : Our long-term economic goal (subject to some qualifications mentioned later) is to maximize Berkshire’s aver-age annual rate of gain in intrinsic business value on a per-share basis. We do not measure the economic significance or performance of Berkshire by its size; we measure by per-share progress. We are certain that the rate of per-share pro-gress will diminish in the future – a greatly enlarged capital base will see to that. But we will be disappointed if our rate does not exceed that of the average large American corporation. RULE 4 : Our preference would be to reach our goal by directly owning a diversified group of businesses that generate cash and consistently earn above-average returns on capital. Our second choice is to own parts of similar businesses, attained primarily through purchases of marketable common stocks by our insurance subsidiaries. The price and availa-bility of businesses and the need for insurance capital determine any given year’s capital allocation.

BANK RATE 9.00

REPO RATE 8.00

REVERSE REPO RATE 7.00

MARGINAL STANDING FACILITY RATE 9.00

SENSEX 25,480.84

NIFTY 7602.60

Ankit Tiwari | 9674650102

Ashutosh Deshpande |9088104827

Sanket Tandon | 8697912131

Sobhit Agarwal | 8697912181