|March 11, 2013|
The Sensex gained 800 points after its drop of nearly 300 points immediately following the budget.
the market is beginning to take seriously, the FM's
commitment to cut fiscal deficit.
coupled with a positive outlook on growth by the chief
economic adviser, Moody's announcement that the worst is
over for India and of course the impending interest rate
cut gave buoyancy to Sensex.
In February, India’s services sector expanded at a slower pace as the HSBC India Services PMI fell to a three-month low of 54.2 points, from 57.5 in January.
2011, the index has consistently been above the threshold of
50 which separates expansion from contraction. The expansion
in the sector is positive for the economy as services
contribute to around 60% of India’s GDP.
The U.S. services sector expanded at a faster rate as the ISM Non Manufacturing Index rose from 55.2 in January to 56.0 in February - the highest reading since February 2012.
four-week moving average of jobless claims, which smoothens
out volatility in weekly data, fell by 7,000 to 348,750 for
the week ended March 2 —the lowest level since March 2008.
Dow Jones rose to a new all-time high of 14,329.49 on Thursday.
The expansion in the services sector and the fall in jobless claims indicate that the U.S. economy is improving. These indicators supported rallies in U.S. stocks, as the Dow Jones rose to a new all-time high of 14,329.49 on Thursday.The outlook for the Eurozone remains dismal
In the fourth quarter of 2012, Eurozone exports fell by 0.9% from the third quarter – the biggest quarterly fall since the first quarter of 2009. Imports also fell by 0.9%.
In January, retail sales in the common currency area fell by 1.3% (y-o-y). In Germany – the Eurozone’s largest economy - factory orders declined by 1.9% in January (m-o-m).
indicators suggest that growth in the Eurozone remains
sluggish. However, at a meeting on Thursday, the European
Central Bank (ECB) did not lower interest rates.
At monetary policy meetings this week, the central banks of the G7 countries (except the U.S.) left interest rates unchanged as shown in the table below.
markets such as India have benefited from strong portfolio
investments over the past few years, as central banks around
the world cut interest rates and injected liquidity to
stimulate their economies.
In February, China’s trade surplus was $15.25 billion as exports rose by 21.8% on an annual basis while imports fell by 15.2%. Additionally, the services sector expanded at a slower pace as the HSBC Services PMI fell to 52.1 in February from 54.0 in January.
The fall in imports was higher than expected; suggesting that domestic demand in the world’s second-largest economy has not yet recovered.
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