The retail tale

In a move to support the inflow of money into the retail segment especially single brand retail we saw some moves from Govt agencies The Govt may relax local sourcing and brand ownership norms as part of a comprehensive review of the FDI policy for singlebrand retail and the local sourcing norms could be modified with the 30 per cent requirement applying to costs and not to sales as currently stipulated The condition that retail companies would have to buy from vendors having investment in plant and machinery of less than 1 million would not be relaxed Austerity ire Madrid SPAIN Demonstrators hold signs reading 39Cuts the wealthy first39 in front of riot policemen during a protest in Madrid At least 1000 Spanish ldquoindignantrdquo protesters rallied against austerity cuts before some of them clashed with police who charged demonstrators with batonsu00a0 China Chinese inflation came down to 22 per cent in June from May at 3 per cent which may put the Chinese authorities in a better position to give more importance to monetary easing and support growth which is showing signs of slowing down In India the investor community expects inflation to move up given the below normal monsoon and rise in food prices due to the forthcoming festival season The RBI is meeting for its first quarter review on July 31 the inflation and IIP numbers would play a crucial role in their decision making as far as cutting interest rates is concerned talk out the trouble Athens Greece Greek Prime Minister Antonis Samaras talks with his Finance Minister FM Yiannis Stournaras l while leaving a meeting at the Ministry of Administrative reform and egovernance in Athens Senior Greek ministry officials were meeting to detail 115 billion Euros 141 billion in budget cuts promised to EUIMF creditors a finance ministry source said picsAFP Sectors During last week we saw the Indian IIP number for May which came in at 24 per cent against 09 per cent in April which was above the estimates but the markets slipped on the day of announcement as the growth in capital goods segment fell while the consumer durable segment gained The mining sector registered a decline of 09 per cent and capital goods segment declined 77 per cent while manufacturing recorded a 25 per cent growth in May compared to 01 per cent in April So as the IIP has shown recovery compared to previous months and inflation expected to move close to double digits we may see a tough call from RBI as far as rate cut is concerned In the FII data pertaining to early of July we saw money flowing into the equity markets to the tune of over Rs 7312 billion They expect some reforms to be announced after the PM took charge of the Finance Ministry and there are expectations that the PM will hand over the portfolio to a reformist or he will hold on the portfolio for the time being Infosys Another major event was the Infosys Q1 results which came in on Thursday The Infosys Q1 net profit jumped 3292 per cent to Rs 2289 crore for the quarter ended June 2012 But the stock price was hit after the company cut its sales forecast for this fiscal to 5 per cent which was much lower than 810 per cent predicted last quarter This sharp revision has caused worry among the investor community as their major revenue generator countries are showing signs of slowdown and companies are cutting down their spending Higher costs higher interest rates and slowing economic activity made SIAM lower its car sales growth forecast for the year ended March 2013 The car sale is expected to rise 911 percent lower than the 1012 per cent growth it had forecast in April Also this week the government reported that the remittance from abroad would not be taxed which has eased concerns Greece The new government of Greece won a vote of confidence in parliament early last week The Government led by Prime Minister Antonis Samaras was backed by all 179 members of the three parties constituting the Government while 121 members belonging to the Radical Left Coalition voted against the Government Now as they have won the vote of confidence they have to put in more efforts to turn around the economy and show credible signs Correction Gold has completed its downside correction in the immediate period and it is likely to test 1599 and 1610 Movements above these two levels will lift the commodity towards 1628 Gold has support at 1565 and 1550 Short term buying can be initiated in counters like Hind Oil exploration Harrison Malayalam Thangamayil Jewellery and REC Ltd Alex K Mathews is the author of Financial Services And Systems as well as Option Trading Bear Market Strategies published by Tata McGraw Hill He is also the technical and derivatives research head of Geojit BNP Paribas Financial Services Ltd The author may have a vested interest in investments he has recommended Feel free to email him at alexgeojitcom Geojit BNP Paribas has membership in and is listed on the National Stock Exchange NSE and the Bombay Stock Exchange BSE Disclaimer No financial information whatsoever published anywhere in this newspaper should be construed as an offer to buy or sell securities or as advice to do so in any way whatsoever All matter published here is for educational and information purposes only and under no circumstances should be used for actual trading or making investment decisions Readers must consult a qualified financial advisor prior to making any actual investment or trading decisions based on information published here Any reader taking decisions based on any information published here does so entirely at his or her risku00a0