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FE NEWS SERVICE
Hongkong SE grossly overvalued -- Salomon: Hong Kong's stock market is overvalued by around 2,500 points given the weak economic fundementals, a leading US investment house warned on Thursday. Salomon Smith Barney said in its latest report that fair value for the blue chip Hang Seng Index was around 7,500, well below its 10,046.15 closing level on Thursday. The bank said to justify an index level of 10,800 short term interest rates would need to fall to 1.5 per cent and unemployment needs to drop back to 2.5 per cent from its current 5.3 per cent level. Salomon said those assumptions are "outrageously optimistic." But the bank added that sharp downward profit revisions by major corporations are likely to be over in the next three months, if the downward trend in interest rates continues. The market has rallied around 60 per cent since hitting a five-year low in August.
Kothari Pioneer waives load on equity funds: Beginning this December upto March 1999, Kothari Pioneer has decided to do awaywith the 3 per cent load on all their open end equity funds which include KP Bluechip, KP Prima Fund, KP Prime Plus and KP Infotech Fund. According to a release from the Kothari Pioneer AMC, the decision to waive load factors on open end equity funds is a part of its fifth anniversary offer.
ICICI Premier roll over: Prudential ICICI Asset Management Company plans to roll over its ICICI Premier into a balanced scheme. The scheme comes up for redemption in February 1999. The roll over option will be a close-ended scheme for a further period of five years upto February 2004. 60 per cent of the balanced portfolio would be invested in debt and the remaining 40 per cent in stocks of MNC companies.
NSE completes 210th settlement: The National Stock Exchange has successfully completed its 210th settlement number N1998046 on Thursday. The total value of the settlement was Rs 4 801.87 crore for securities and Rs 160.09 crore in funds. The quantity of securities settled through dematerialised mode was127.12 lakh valued at Rs 206.70 crore. The pay out was completed and all shortages to the extent of 1.73 per cent successfully auctioned. Unrectified bad deliveries for the previous settlement to the extent of 0.18 per cent was also auctioned successfully. The total value of shares traded in the depositorysegment was Rs 28.82 crore during the period November 18 to 24, 1998. The total value of the settlement for the same was Rs 23.15 crore for securities.
Kotak gilt funds to open on Dec 11: The Kotak Mahindra Asset Management Company (KM AMC) launched its two maiden schemes, the KGilt and K-30, which will open for initial public subscription from December 11-21. Speaking to The Financial Express, vice-chairman Kotak Mahindra Finance, Uday S Kotak said that this was the right time to launch this scheme as safety of capital was paramount on any investor's mind today. "The time is appropriate for this product. Investors are risk-averse these days and the gilt fund should be the answer to theirsafety as well as return needs," he added.
More buyback through demat form: Corporates might well opt for buying back their shares only in demat form to avoid payment of hefty stamp duty. A corporate would be required to pay a stamp duty of 50 basis points on each buy-back transaction when it buys back the shares from the shareholders in the physical form. This is because the shares are transferred in the name of the company before they are extinguished and hence, would be eligible for payment of stamp duty. The SEBI guidelines or the ordinance has not suggested anything to the contrary and hence the buyer, which is the company, would need to pay a stamp duty charge on the purchases made by it.
DSE stocks move sideways in dull trading: In lacklustre trading, shares fell back ot close with mild to moderate losses on the Delhi Stock Exchange on Thursday following mid-way selling by nervous bull operators amidst absence of necessary buying activity. Market sources said reports that rulingBJP-led coalition was facing crisis over the issue of opening up of insurance sector for foreign companies unnerved the market sentiments. They said major players, particularly foreign funds were concerned over the fate of the insurance bill, likely to be introduced in the parliament early next week. The DSE sensitive index ended 3.07 points down at 619.30 points.
Indian GDRs increase 1.53%: The Skindia GDR index, representing GDR's of 18 actively trading companies increased by 1.53 per cent from 520.00 to 527.95 on Dec 2, 1998 as per the Skindia GDR index with a base January 3, 1995 equal to 1000. The Skindia GDR index P/E ratio was 14.65 as compared to 14.39, according to Skindia Finance. There were 14 gainers, 3 losers and 43 unchanged as compared to one gainer, 15 losers and 44 unchanged on Dec 1. The top gainers for the day was ICICI, Guj Ambuja and ITC which was quoted at US $6.13, 5.35 and 19.48 as against 5.80, 5.18 and 18.90 on Dec 1.
Tokyo stocks fall: Tokyo stocks fell 1.7 percent in morning trade on Thursday, after Wall Street tumbled, brokers said. The Nikkei 225 index lost 257.36 points to close morning trade at 14,729.26 points. "What pulled down Tokyo shares in the morning was the fall on Wall Street yesterday," said a broker from Nomura Securities Co Ltd. Stocks on Wall Street were down Wednesday after Boeing Co warned it was slashing production in response to the economic crisis in Asia. The Dow Jones Industrial Average lost 69 points, or 0.75 per cent, to end at 9.064,54. "Uncertainy over the US economy is growing given the tumbled Wall Street as well as the weakening dollar," the Nomura broker said.
Hong Kong shares dip 1.5%: Hong Kong share prices fell 1.5 per cent in cautious trade Thursday, dipping back below the 10,000-point level after overnight losses on Wall Street, dealers said. The key Hang Seng index lost 152.74 points to close at 9,903.04.
Copyright © 1998 Indian Express Newspapers (Bombay) Ltd.
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This story was printed from Net Express located at http://www.expressindia.com. Net Express provides a portal to India, with news from The Indian Express and The Financial Express along with sites on travel and tourism, the entertainment industry, the power sector, the environment and much more.
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