Oil price touches high for 2009

The price of oil has hit its highest level of the year, boosted by sharp rises in Chinese stocks and rising shares on Wall Street.

The price of US crude rose to $74.15 a barrel before settling at $73.89, a gain of 98 cents. London Brent was up 86 cents at $74.19.

The oil price hit $147 a barrel last July and fell below $74 last October, a level it has not breached since.

Worldwide oil prices have been extremely volatile this year.

Prices have been affected as much by sentiment as by fundamentals of demand and supply.

Ben Bernanke, the chairman of the Federal Reserve, said that prospects for a return to growth in the near term appeared good in the US and abroad.

Dreamworks seals Indian film deal

Hollywood's Dreamworks studio is finally set to receive a multi-million dollar film production deal from Indian company, Reliance Big Entertainment.

The first film from the investment will be Harvey, an adaptation of a play about a man and a giant invisible rabbit. Stephen Spielberg will direct.

Reliance is a key player in Bollywood. Dreamworks was co-founded by Spielberg.

Under the agreement, Dreamworks will make five to six films every year for global audiences.

The second movie, titled Dinner for Schmucks, will begin shooting in October.

Blackberry 'fastest-growing firm'

The maker of the Blackberry mobile phone, Research in Motion (RIM), is the world's fastest-growing company, according to business magazine Fortune.

Canada-based RIM has come top of the magazine's latest annual guide to the 100 fastest-growing businesses.

In second place was US chipmaker Sigma Designs, with Chinese internet business Sohu.com coming in third.

Fortune rates a firm's growth on a combination of its profits, turnover and investment return over three years.

Sensex wipes off some losses, ends 250 pts higher

The Bombay Stock Exchange benchmark Sensex on Tuesday surged over 250 points after the market dropped 4.07 per cent on Monday.

The Sensex, which had lost 626.71 in Monday's trading, bounced back to end with a gain of 250.34 points at 15,035.26.


The key index touched the day's high of 15,134.51 and a low of 14,740.26 as trading remained choppy because of funds and general investors adjusting their portfolios.


Similarly, the 50-share National Stock Exchange index Nifty rose 71 points at 4,458.90, after rising to 4,491.45 and touching the day's low of 4,372.65.


Recovery in Asian as well as European stocks this afternoon further boosted trading sentiment following reports of a hike in new house sales data in the US and rising hopes of stability in the weakening global economies.


A major supporter to the markets were stocks in the capital goods, realty, metal, power and auto segments.


Overseas funds bought a net Rs 1,030 crore (USD 211 million) of Indian stocks on 14th August, the Securities & Exchange Board of India said on its web site.


The funds have bought stocks of Rs 37,600 crore this year, compared with record net sales of Rs 53,000 crore for the whole of 2008.

Recession ends but markets fall

Japan may be officially out of recession, but regional investors are still cautious, with East Asian markets closing lower in Monday trading.

Economists believe the falls are linked to the latest consumer data from the US, which showed that shoppers there are not yet ready to start spending.

Japan's export-oriented industry relies heavily on US demand.

China's main Shanghai index fell 5.8% to 2,870.63, while Japan's Nikkei 225 fell 328.72 points (3.1%) to 10,268.61.

However, the Nikkei is still up by almost 900 points since mid-July.

Hong Kong's Hang Seng and South Korea's Kospi also fell and the price of US light, sweet crude fell below $66 a barrel - its lowest level this month. It fell $1.73 to $65.78.

"Production [in Japan] is still at a low level, and worries remain that employment conditions will worsen. So we must watch the downside risks," said Japan's economy and fiscal policy minister Yoshimasa Hayashi.

Japan's economy leaves recession

Japan has come out of recession after its economy grew by 0.9% in the April-to-June quarter.

The growth comes after four consecutive quarters of contraction.

Correspondents say the rise is due to a huge government stimulus package and it is unclear whether the momentum will be sustained when this is concluded.

Recent figures show other economies coming out of recession, including Germany, France and Hong Kong, a sign the global slowdown is easing.

Despite Japan exiting recession, the country's main share index, the Nikkei, fell back as the rate of growth was not as large as analysts had hoped.

If Japan's latest quarterly rate were maintained for a full year, the economy would grow 3.7%, but this was less than market expectations of 3.9%.

The Nikkei ended down 329 points or 3.1% to 10,269.

Sensex falls most in more than one month, melts 626 points

The BSE benchmark Sensex on Monday suffered most in one month by losing nearly 627 points on frantic selling by funds because of a steep fall in global markets and investors booking profits.

The Sensex, which notched up nearly a 1.71 percent gain in the previous week, plunged by 626.71 points at 14,784.92, the biggest fall since 6th July, the day the Budget was presented.



The index touched the day's low of 14,740.63. All the Sensex stocks closed with moderate to notable losses.

Similarly, the wide-based National Stock Exchange index Nifty lost 192.15 points at 4,387.90 as heavy-weights led by the realty sector showed hefty declines. The Nifty touched the day's low of 4,374.60 points.

Marketmen said the bourse tumbled here tailing weak Asian peers as concerns grew that global economic recovery may be more difficult than expected after data showed US consumer confidence fell to its lowest since March.

They said the selling wave was so strong that almost all sectoral indices showed biggest fall in recent times.

Market sentiment turned bearish also on reports of an international agency saying the stocks might decline up to 15 percent on concerns that lower monsoon rain would slash farm output and cut consumer spending.

Nigeria sacks heads of five banks

The Nigerian central bank has injected 400bn naira ($2.6bn; £1.6bn) into five banks and sacked their managers.

The regulator said the banks were undercapitalised and posed a risk to the entire banking system.

Governor Lamido Sanusi said Afribank, Finbank, Intercontinental Bank, Oceanic Bank and Union Bank would be run as normal until new investors were found.

The move was unprecedented in Nigeria, sending the naira down 2% to 156.9 versus the dollar.

'Questions'

"The banks have lost their money in bad loans," Mr Sanusi told reporters in Lagos. "We have questions about the management, so we have put in new management."

"We assure every depositor that no-one will lose money and we will continue to support the banks and all Nigerian banks," he said.

Armed police secured the buildings of the five banks to protect their assets.

Mr Sanusi took over as head of the central bank over two months ago, pledging to clean up the banking system that has fuelled growth in Nigeria.

Among the executives removed were senior members of Nigeria's corporate elite, long seen as almost untouchable by the political establishment.

"The banking sector is a critical part of any economic system and we believe the steps being taken will deliver an effective solution to a very serious set of challenges," said Michael Hugman, a strategist at Standard Bank.

The five institutions account for 40% of banking sector credit in Nigeria.

Bad loans

Mr Sanusi said the five banks had accounted for almost 90% of exposure to the central bank's so-called discount window, which allows banks to borrow in the short-term from the central bank to meet their needs.

"The excessively high level of non-performing loans in the five banks ... was attributable to poor corporate governance practices, lax credit administration processes and the absence or non-adherence to credit risk management practices," he said.

Mr Sanusi added the Nigerian government had no intention of nationalising the five banks and that this was a temporary measure.

The central bank has completed audits of 10 banks, including the five being rescued, and the Central Bank of Nigeria will now probe all of the country's 24 banks, Mr Sanusi said.

Oil cos hike ATF price by 4.5 pc

Even as the aviation industry is crying for a bail-out, state-run oil firms on Saturday hiked jet fuel prices by 4.5 percent in step with firming international oil rates, the second time in a month.

Indian Oil, Bharat Petroleum and Hindustan Petroleum raised Aviation Turbine Fuel (ATF) rates in Delhi by Rs 1,662 per kilolitre to Rs 38,585 per kl effective midnight tonight, an IOC official said on Saturday.

Global crude oil prices have firmed up during August on signs of recovery in major economies of the world including India. Crude oil prices rose to USD 74 per barrel last week.

The hike in ATF or jet fuel prices comes on the back of Rs 585 per kl or 1.6 per cent hike on 1st August.

In Mumbai, home to the nation's busiest airport, the rate will go up from Rs 38,098 per kl to Rs 39,830 per kl, the official said.

The rise in ATF price, which constitutes 40 percent of airlines' operating cost, may further put pressure on cash-strapped domestic carriers.

The state oil firms had in July cut jet fuel prices on falling international rates and the two hikes this month has wiped away the decline.

Jet fuel in Kolkata will be dearer at Rs 46,819 per kl from Rs 45,060 per kl, while in Chennai the price has been raised by Rs 1,816 per kl to Rs 42,605 per kl. The average hike works out to Rs 1,742 per kl.



ATF prices had peaked to Rs 71,028.26 per kl (in Delhi) in August last year on international crude prices touching a historic high of USD 147 a barrel.

But subsequently, the rates had come down, slashed every month till October and twice a month from November.

The three firms revise jet fuel rate every fortnight based on trends in international markets.

Two days ago, Civil Aviation Minister Praful Patel had raised in the union cabinet meeting the issue of ATF prices in the overall context of the health of the aviation sector, after which it was decided to set up a Group of Ministers (GoM) soon to study the impact of high jet fuel prices on the aviation industry and recommend measures to bring down its burden on operational costs of the airlines.

Patel said the base price of ATF in India was "much higher" than in most countries.