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RBI measures fail to cheer market, Sensex falls 43 points

By The Assam Tribune
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Mumbai, June 25 (IANS): The measures announced by the Reserve Bank of India (RBI) on Monday to revive the rupee failed to cheer the market as the benchmark index slipped into the negative soon after the announcement.

The 30-scrip sensitive index (Sensex) of the Bombay Stock Exchange (BSE), which was in the positive till late afternoon, was ruling at 16,928.60 points - 43.91 points or 0.26 percent down from its previous close at 16,972.51 - around 2.45 pm.

The RBI announced a series of measures, including raising limits for external commercial borrowings and government securities, aimed at reviving the battered currency and the economy.

The Sensex touched a high of 17,131.15 points and low of 16,928.60 points in the intra-day trade. The IT index was down by 34.56 points and the banking index by 67.34 points. The wider 50-scrip S&P CNX Nifty of the National Stock Exchange (NSE) too was trading 0.33 percent lower at 5,129 points.

Major Sensex losers included Hindalco Inds, down 2.64 percent at Rs.114.15; Hero MoroCorp, down 1.89 percent at Rs.2045; ONGC, down 1.65 percent at Rs 274.80; Cipla, down 1.64 percent at Rs 308.55; and TCS, down 1.41 percent at Rs 1216.25.

Major Sensex gainers were Maruti Suzuki, up 1.60 percent at Rs 1119; Tata Power, up 0.85 percent at Rs 95.20; Gail India, up 0.70 percent at Rs 343.25; RIL, up 0.68 percent at Rs 715.90; HDFC, up 0.54 percent at Rs 643.10.

RBI announces steps to revive rupee: The Reserve Bank of India (RBI) today announced a series of measures, including raising limits for external commercial borrowings and government securities, that would help revive the battered currency and the economy.

The Reserve Bank of India said in a statement that it has taken measures in consultation with the government to liberalise capital account transactions. It has been decided to allow Indian companies in the manufacturing and infrastructure sector and earning foreign exchange to avail of external commercial borrowing (ECB) for repayment of outstanding rupee loans towards capital expenditure and/or fresh Rupee capital expenditure under the approval route, the RBI said.

"The overall ceiling for such ECBs would be $10 billion," the central bank said.

The existing limit for investment by Securities and Exchange Board of India (SEBI) registered foreign institutional investors (FIIs) in government securities (G-Secs) has been enhanced by a further amount of $5 billion.

This would take the overall limit for FII investment in G-Secs from $15 billion to $20 billion.

"In order to broad base the non-resident investor base for G-Secs, it has also been decided to allow long term investors like Sovereign Wealth Funds (SWFs), multilateral agencies, endowment funds, insurance funds, pension funds and foreign central banks to be registered with SEBI, to also invest in G-Secs for the entire limit of $20 billion," the RBI said.

The sub-limit of $10 billion (existing $5 billion with residual maturity of 5 years and additional limit of $5 billion) would have the residual maturity of three years.

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RBI measures fail to cheer market, Sensex falls 43 points

Mumbai, June 25 (IANS): The measures announced by the Reserve Bank of India (RBI) on Monday to revive the rupee failed to cheer the market as the benchmark index slipped into the negative soon after the announcement.

The 30-scrip sensitive index (Sensex) of the Bombay Stock Exchange (BSE), which was in the positive till late afternoon, was ruling at 16,928.60 points - 43.91 points or 0.26 percent down from its previous close at 16,972.51 - around 2.45 pm.

The RBI announced a series of measures, including raising limits for external commercial borrowings and government securities, aimed at reviving the battered currency and the economy.

The Sensex touched a high of 17,131.15 points and low of 16,928.60 points in the intra-day trade. The IT index was down by 34.56 points and the banking index by 67.34 points. The wider 50-scrip S&P CNX Nifty of the National Stock Exchange (NSE) too was trading 0.33 percent lower at 5,129 points.

Major Sensex losers included Hindalco Inds, down 2.64 percent at Rs.114.15; Hero MoroCorp, down 1.89 percent at Rs.2045; ONGC, down 1.65 percent at Rs 274.80; Cipla, down 1.64 percent at Rs 308.55; and TCS, down 1.41 percent at Rs 1216.25.

Major Sensex gainers were Maruti Suzuki, up 1.60 percent at Rs 1119; Tata Power, up 0.85 percent at Rs 95.20; Gail India, up 0.70 percent at Rs 343.25; RIL, up 0.68 percent at Rs 715.90; HDFC, up 0.54 percent at Rs 643.10.

RBI announces steps to revive rupee: The Reserve Bank of India (RBI) today announced a series of measures, including raising limits for external commercial borrowings and government securities, that would help revive the battered currency and the economy.

The Reserve Bank of India said in a statement that it has taken measures in consultation with the government to liberalise capital account transactions. It has been decided to allow Indian companies in the manufacturing and infrastructure sector and earning foreign exchange to avail of external commercial borrowing (ECB) for repayment of outstanding rupee loans towards capital expenditure and/or fresh Rupee capital expenditure under the approval route, the RBI said.

"The overall ceiling for such ECBs would be $10 billion," the central bank said.

The existing limit for investment by Securities and Exchange Board of India (SEBI) registered foreign institutional investors (FIIs) in government securities (G-Secs) has been enhanced by a further amount of $5 billion.

This would take the overall limit for FII investment in G-Secs from $15 billion to $20 billion.

"In order to broad base the non-resident investor base for G-Secs, it has also been decided to allow long term investors like Sovereign Wealth Funds (SWFs), multilateral agencies, endowment funds, insurance funds, pension funds and foreign central banks to be registered with SEBI, to also invest in G-Secs for the entire limit of $20 billion," the RBI said.

The sub-limit of $10 billion (existing $5 billion with residual maturity of 5 years and additional limit of $5 billion) would have the residual maturity of three years.

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