India's forex reserves dropped

Foreign Reserve Exchange

India's foreign exchange (forex) reserves dropped by $1.22 billion at $311.48 billion for the week ended Sep 30, registering a sharp decline for the second straight week largely due to revaluation of non-dollar assets, official data showed. The country's foreign exchange reserves kitty has shrunk by $9.30 billion in the last four weeks after wselling to an all-time high of $320.78 billion for the week ended Sep 2. Foreign currency assets, the biggest component of the forex reserves kitty fell by $1.23 billion to $275.69 billion during the week under review, according to the weekly statistical supplement of the Reserve Bank of India (RBI), the country's central bank.

Sensex down by 333 points

The BSE benchmark sensex was down by 333 points in early trade on Monday on all-round selling pressure from operators and investors as asian shares slumped amid rising fears of a Greek sovereign default and worries over China's financial health. The BSE benchmark sensex resumed lower at 16.255.97 points and dropped further to 16,088.98 before quoting at 16,121.21 1015 hours, a net loss of 332.55 points, or 2.02%, from last weekend's close. The stock market is likely to move in a narrow range this festive week, ahead of second quarter earnings' report card from India Inc. Participation is likely to remain los, and the market is closed on thusday due to Dussehra. Government's sudden borrowing programme has not gone down well with the market participants. To meet its expendititure in the second half of the fiscal, the Centre had decided to borrow an additional Rs.52,800 crore from the market, over and above the Rs.4.17 lakh crore estimated earlier. The Bombay Stock Exchange benchmark sensex continued to trade lower by over 270 points at the pre-close session today on sustained selling by funds and retail investors due to weak global cues. Stock markets worldwide were hit by news that Greece would not be able to contain deficit despite 30,000 job cuts.

Rupees fell by 59 paisa to Rs.49.55 per US dollar

In line with weakness in the equity market, the Indian rupee fell by 59 paise to Rs.49.55 per US dollar in early trade today amid persistent dollar demand from banks and importers in view of dollar firmness in overseas markets. The rupee had ended 2 paise lower at Rs.49.45/46 against US dollar in the previous session due to strong dollar demand from importers amid weak stock markets.

Greece crisis

Oil rose to near $78 a barrel on Wednesday in Asia amid hopes that Europe will contain the debt crisis that has engulfed greece and threatens to destabilize other countries that use the Euro. but sentiment recovered on Tuesday following reports that Europe was talking steps to bolster its banking sector, which is thought to be heavily exposed to Greek debt and could face crushing losses if the country defaults. Wall Street ended higher after a day of wild gains and losses. The Dow gained 1.4 per cent, while the Standard and Poor's 500 rose 2.2 per cent and the Nasdaq composite rose 3 percent. Investor concerns about Greece were heightened when the debt-strapped country said over the weekend it will miss its lower budget deficit targets even after severe cost-cutting. Despite the shortcoming, Europe pledged to loan Greece money to help pay its upcoming bills, but that failed to reassure stock and commodity markets. European markets tumbled on Monday after Greece said it wouldn't be able to reduce its budget deficits as much as it had agreed to as part of a deal to receive more emergency loans.

Asian Stock Market extended a sell - off

Asian stock markets extended a sell-off on Tuesday, following a dismal session on Wall Street that was sparked by the revelation that debt-strapped Greece would not be able to reach a target for reducing its budget deficit. Asian markets tumbled sharply in early trading on Monday, hurt by data suggesting debt-strapped Greece attempts at austerity were not yileding results and a weakening economic picture in Europe. Japan's Nikkei 225 fell 2.3 per cent to 8,503.88, with a government survey showing an improvement in business confidence among Japanese manufacturers doing little to nudge markets back to life.

Inflation and interest rate keeps market fluctuate

Inflation

Apart from concerns over a slowdown of the US economy and the euro zone debt crisis, high domestic inflation and fears of an interest rate hike will keep the stock market volatile this week, say experts. Headline inflation stood at 9.44 per cent in June, while weekly food inflation shot up to 9.9 per cent at the end of July, sparking fears of a further round of interest rate hikes to tame prices.

Problems in dairy farming

Dairying is a centuries-old tradition for millions of rural households; domesticated animals have been an integral part of the farming system from time immemorial. It provides supplementary income to some 70 million farmers in over 500,000 remote villages the farmers earn an average 27.3 percent of their income from dairying, with as high as 53 percent for landless and as low as 19 percent for large farmers. Annual milk production in India have more than tripled in the last three decades, rising from 21 million tones in 1968 to 80 million metric tones in 2001. Despite this impressive growth in milk production in the last three decades, productivity of dairy animals remains very low. Currently more than 80 percent of the milk produced in the country is marketed by unorganized sector is likely to dissuade small dairy farmers from expanding production, which is absolutely necessary to keep up with the strong demand growth.