Daily News (In Short)-27-July-2015

#* Sensex Slumps 450 Points Amid P-Note Jitters. Don't Panic, Says Jaitley

Finance Minister Arun Jaitley has sought to calm investors after the Sensex fell more than 450 points on Monday, amid jitters over a recommendation for stiff norms for participatory note or P-Notes and an 8 per cent plunge in China markets.

Mr Jaitley promised that "the government will not take any steps that will adversely impact the country's investment climate."

He ruled out a "knee-jerk reaction" to the special investigation team or SIT's recommendation last week for tighter regulations on P-notes to curb the flow of black money. P-notes are instruments through which foreign individuals, hedge funds and others invest in India's stock markets without being registered with market regulator Securities and Exchange Board of India (Sebi)

 (Read: Jaitley rules out 'knee-jerk' reaction on P-note)

Revenue Secretary Shaktikanta Das told NDTV, "There is no reason for the market to panic." He said the government would consult market regulator Securities and Exchange Board of India (Sebi), the Reserve Bank of India and other stakeholders before deciding on the P-Note issue.

At 2:03 p.m., the BSE Sensex was down 409 points at 27,703 while Nifty fell 119 points to hover near 8400 levels.

Chinese shares tumbled more than 8 per cent on Monday - their biggest one-day drop in eight years - amid renewed fears about the outlook for the world's No. 2 economy. This shattered a period of relative calm in China's volatile stock markets since Beijing unleashed a barrage of support measures to arrest a slump that began in mid-June.

(Read: China stocks suffer biggest 1-day loss since February 2007)

P-Notes are popular with foreign investors because they are able to save time and the costs associated with direct registration with Indian authorities.

Investments through participatory notes in India's capital market were at a whopping Rs 2.75 lakh crore (about $43 billion) at the end of June. This was 11.5 per cent of the total foreign institutional investment (FII) in Indian markets.

But investment through P-Notes has been steadily decreasing over the years. Till a few years ago, P-Notes used to account for more than 50 per cent of total FII investment, but their share has fallen as Sebi has tightened disclosure norms and other related regulations.

In 2007, a crackdown on P-Notes had led to a 10 per cent plunge in the Sensex within minutes of the market opening. Trading had to be halted and then finance minister P Chidambaram had to make statements to calm the markets.

Prabhat Awasthi, managing director & head of equity at Nomura India said he expects the P-Note issue to be a "passing phase" for the Indian markets. "Typically these issues have tended to get resolved because the government tends to be sensible about not disrupting the market," he said.

"Besides, many global banks have tightened their KYC norms. So the bulk of P-notes, specially coming through issuance done through global investors, will all be genuine guys," he added.

However, Mr Awasthi warned that if there are additional norms in the wake of SIT's recommendations that make it for difficult for foreign investors to invest in Indian markets, it would be cause for concern. (With Agency Inputs)

#* Obama begins talks with Ethiopia's PM Hailemariam Desalegn

US President Barack Obama has begun talks with Ethiopia's Prime Minister Hailemariam Desalegn on the second leg of his African tour.
They are expected to centre on human rights and regional security issues, as well as the civil war in South Sudan.
Mr Obama is the first serving US leader to visit Ethiopia and will be the first to address the 54-member African Union in Addis Ababa on Tuesday.
Mr Obama flew to Ethiopia after a two-day visit to Kenya.
BBC Africa Live: Obama in Ethiopia updates
There he had discussed trade and security but also called for greater human rights and warned of the dangers of corruption.
The US president was greeted at Addis Ababa's international airport on Sunday by Mr Hailemariam.
Compared to the Kenyan leg of his tour, President Obama's arrival in Ethiopia signals a more sombre mood.
Ethiopia is a close ally of the US in fighting militant Islamists. Thousands of Ethiopian troops are in Somalia, where the capital Mogadishu was the scene of a major bomb blast on Sunday.
But despite security ties, Mr Obama is expected to raise concerns about what critics say is the erosion of democratic freedoms in Ethiopia.
Recent elections in which the ruling party secured all of the parliamentary seats, and a further clampdown on the media and the jailing of bloggers, are among the issues on which the US president is expected to express alarm.
Grey line
In talks on South Sudan with leaders from Ethiopia, Kenya and Uganda as well as the Sudanese foreign minister, he is expected to call for tougher sanctions and a possible arms embargo if the warring factions do not agree on a peace deal.
However, a US official travelling with Mr Obama said they were not expected to lead to a breakthrough.
"This is an opportunity to reinforce the effort that's on the table and to strategise... on next steps in the event that it doesn't succeed," the official told reporters.

#* BSE Sensex falls over 450 points, Nifty below 8400 over P-Notes concerns, China stocks plunge

The BSE Sensex extended its losses and was trading over 450 points down on Monday amid concerns over participatory notes norms and China stock markets plunging over 8 per cent, marking their biggest one-day drop in more than eight years. NSE Nifty was also under pressure and was trading below 8,400 mark.
At 1.17 pm, Sensex was down 417.98 points at 27,694.33. Similarly, Nifty was down 123.50 points at 8,398.05 during the same time.
A sharp fall in the Asian markets also contributed the weak markets sentiments. Asian stocks had already started the week on a low note, rattled by a last week’s report on Chinese manufacturing that sparked a sell-off in gold as well as copper and other commodities.
China stocks plunged over 8 per cent on Monday, marking their biggest one-day drop in more than eight years, as a government-triggered rebound petered out amid profit-taking, concerns over economic health and fears of an end to Beijing’s inclination toward looser monetary policies. The CSI300 index of the largest listed companies in Shanghai and Shenzhen fell 8.6 per cent, to 3,818.73, while the Shanghai Composite Index lost 8.5 per cent, to 3,725.56 points.
Sensex tumbled 350.43 points at 27,761.88 and NSE Nifty went down 99.55 points at 8,422.00 at around 12.20 pm.
The traders were cautious over reports on Sebi likely to review participatory notes norms. A government panel on black money has asked Sebi to obtain “beneficial ownership” details for such instruments, as also for monitoring any unusual rise in stock prices, according to media reports.
Sustained selling after disappointing earnings posted by majority of bluechip companies so far and a weak trend at other Asian bourses following weekend sell-off on the US markets also affected the market sentiments.
Shares of Reliance Industries also fell by over 1 per cent on profit-taking that also contributed to the market fall.
Among other Asian markets, Hong Kong’s Hang Seng was down 2.50 per cent while Japan’s Nikkei slid 0.98 per cent in early trade today on growing concerns about the Chinese economy.
The US Dow Jones Industrial Average ended 0.92 per cent down on Friday.

#* Qualcomm appoints Sunil Lalvani as President of India ops

Mobile chip maker Qualcomm on Monday said it has appointed former BlackBerry India and SAARC MD Sunil Lalvani as the president of its India operations. He succeeds Avneesh Agrawal, senior vice-president and president of Qualcomm India and South Asia. Agrawal, who has been granted 159 US patents, is moving on to pursue his entrepreneurial ambitions. Lalvani's appointment will be effective July 27 and he will report directly to Cristiano Amon, executive vice-president and co-president, Qualcomm Technologies Inc (QTI), Qualcomm said in a statement. With over 20 years of experience, Lalvani has also worked with EMC Corporation, Nokia Corporation, Cisco Systems and SITA Equant Network (now Orange Business Services). "I am pleased to welcome Sunil Lalvani as vice-president (of QTI) and president of Qualcomm India. His broad industry experience and extensive leadership experience will enable us strengthen existing strategic relationships, identify new opportunities for business growth and build new relationships in India," Amon said. Lalvani joins Qualcomm at a time, when the company is undertaking a massive restructuring globally. Last week, Qualcomm announced that it will slash 15 per cent of its global head count and eliminate about USD 1.4 billion in spending as it looks to increase resources in "lower-cost regions". Qualcomm has five engineering centres and offices in India in Delhi, Mumbai, Bengaluru, Hyderabad and Chennai.

#* FM Arun Jaitley says govt to take view on Financial Code after public comments

Finance Minister Arun Jaitley said on Monday the government will take a view on the draft Indian Financial Code, which proposes to dilute powers of the RBI chief , after receiving comments from stakeholders.
FSLRC has made its recommendations, which have been made public for comments. After the comments are received, it is only then that the government will take a view, he told reporters in New Delhi.
The draft had proposed taking away Reserve Bank chief's authority to veto the interest rate decision of the central bank's monetary policy committee.
The revised draft of Indian Financial Code (IFC) also proposed that the committee would have four representatives of the government and only three from the central bank, including the 'RBI Chairperson'.
The draft talks of 'RBI Chairperson' and not 'RBI Governor'.
RBI is headed by a Governor, at present. The revised draft of IFC, released by the Finance Ministry last week, is based on the recommendations of the Financial Sector Legislative Reforms Commission (FSLRC), headed by Justice B N Srikrishna.
The IFC, which is conceived as an overarching legislation for the financial sector, proposes a monetary policy committee which will be entrusted with the task of deciding the key policy rate and chasing the annual retail inflation target to be decided by the government in consultation with RBI.
Further, it said the RBI must constitute a Monetary Policy Committee to determine by majority vote on the Policy Rate required to achieve the inflation target. At present, the RBI Governor consults a Technical Advisory Committee, but does not necessarily go by the majority opinion while deciding on the monetary policy stance. 

#* Cheaper and efficient metal-based solar cells may soon be available

Scientists from Rice's Laboratory for Nanophotonics described a new method that solar-panel designers could use to incorporate light-capturing nanomaterials into future designs.

Bob Zheng, a graduate student and postdoctoral research associate Alejandro Manjavacas created a methodology that solar engineers could use to determine the electricity-producing potential for any arrangement of metallic nanoparticles. Zheng said that one of the interesting phenomena that occurred when someone shined light on a metallic nanoparticle was that you can excite some subset of electrons in the metal to a much higher energy level.
Todays most efficient photovoltaic cells use a combination of semiconductors that are made from rare and expensive elements like gallium and indium. Zheng said that Plasmonic-based photovoltaics had low efficiencies, adding that it has not been entirely clear whether those arose from fundamental physical limitations or from less-than-optimal designs. He said a recent example of such work comes from a pioneering experiment by another Rice graduate student, Ali Sobhani, where the absorption was concentrated near a metal semiconductor interface.

The scientists have spent years developing techniques to bolster the field-intensity enhancement of photonic structures for single-molecule sensing and other applications. The findings are published in Nature Communications.

#* Evolution of animals facilitated by tiny boost in oxygen levels

 Washington DC: A group of researchers have claimed that a minor jump in oxygen levels facilitated the early evolution of animals.
 
The discovery questions the theory that a dramatic change in oxygen levels might have been responsible for the appearance of complicated life forms like whales, sharks, and squids evolving from less complicated life forms, such as microorganisms, algae, and sponges.
 
According to the researchers, oxygen levels in water and atmosphere rose at lower levels than was thought necessary to trigger life changes.
 
Benjamin Gill, an Assistant Professor in the College of Science, suggested that about 635 million to 542 million years ago, the Earth passed some low, but critical, threshold in oxygenation for animals.
 
Gill added that threshold was in the range of a 10 to 40 percent increase, and was the second time in Earth's history that oxygen levels significantly rose.
 
The scientists estimated oxygen levels by analysing iron found in shale rock, which was once mud on ancient seafloors. The location and amounts of iron in the rock gave important clues about ancient ocean water chemistries over time.

#* Robot passes test for human trait for the first 

New York: A robot has for the first time displayed the human trait of self-awareness while attempting to solve a classic logic puzzle, scientists say.
In the puzzle known as The King's Wise Men, three wise men are given hats of either white or blue, with the guarantee that at least one of the hats is blue.
The men are not allowed to speak to each other – the first man to stand up and correctly announce the colour of his hat wins.
For the robot's self-awareness test, Selmer Bringsjord, from the Rensselaer Polytechnic Institute AI and Reasoning Lab in New York, used three of French robotics company Aldebaran's humanoid Nao robots.
He had programmed these with a proprietary algorithm called Deontic Cognitive Event Calculus, which enables the robots to carry out reasoning, 'CNET' reported.
The three robots were told that two of them had been given "dumbing pills" that rendered them unable to speak, and one a placebo.
In reality, they had a button pressed on their heads, which muted two of the robots. They were then asked if they had been given the dumbing pill or the placebo.
After a few moments of silence, one robot stood up and said "I don't know."
It immediately realised what had happened, raised its hand and said, "Sorry, I know now. I was able to prove that I was not given the dumbing pill."
In order to demonstrate this sort of self awareness, the robot must be able to understand the rules of the puzzle, recognise its own voice and recognise that it is an individual distinct from the other two robots.

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