Sensex holds on to modest gains

The key Indian stock indices have managed to hold on to moderate gains in early afternoon trade even as the broader indices have extended last week's losses. ADAG stocks remain under pressure after market regulator SEBI barred Anil Ambani and two group companies from investing in the secondary market.

In global action, markets in Asia are trading mixed. The Chinese stocks are under pressure after the central bank hiked the banks' reserve requirement again. Even the Japanese market, which was holding firm through the day, has slipped into the negative territory.

The US financial markets will be shut today for a public holiday. Wall Street gained on Friday, paced by strength in the financials, after JP Morgan Chase announced solid earnings. European indices closed lower on Friday.

At 12:48 pm (IST) the BSE Sensex was trading at 18,917 up 56 points. It had earlier touched a high of 18, 967 and a day’s low of 18,779.It opened at 18,911.

The NSE Nifty on the other hand was trading at 5,664 up 9 points over the previous close. It had earlier touched a day’s high of 5,682 and a day’s low of 5,624.

The BSE Small Cap index and BSE Mid cap index are down 0.7% and 0.8% respectively.

In terms of sectors, the IT index is up 1%. Select, FMCG, Banking and Consumer Durables indices are up 0.5%-0.7%. Realty, Power, Metal, Capital Goods and Auto stocks are in the red.

The market breadth in negative on the BSE with 1,727 shares falling and 931 shares rising.

HDFC, Axis Bank, ITC, TCS, Kotak Mahindra Bank, Infosys, Cipla, Cairn India and Wipro were among the leaders in the Sensex and the Nifty.

Reliance infra, Reliance Power, RCOM, Sesa Goa, Sterlite, Hero Honda, DLF and Hindalco were among the laggards in the Sensex and the Nifty.
For more info- http://www.indiainfoline.com/Markets/News/Sensex-turns-red...IT-stocks-advance/5052506921

New power policy gives 50 per cent to 'home' states

The union cabinet today approved a proposal by the power ministry that increases the share of host states to 50 per cent in allocation of electricity generated from centrally-owned thermal power plants.

"The proposal is to allocate 50 per cent of the power generated to the 'home' state where the project is located, 35 per cent to the other constituents of the region, and 15 per cent as unallocated power at the disposal of the centre," a government official told the media after the cabinet meeting.

Currently, the allocation of power generated from thermal stations is guided by the Gadgil formula, under which the host state gets 10 per cent preferential allocation, 15 per cent is kept unallocated as the central government's quota, and the remaining 75 per cent is allocated to beneficiary states in the region.

While the central government's quota, used to tide over periods of acute shortages of electricity, has been kept unchanged at 15 per cent, the share of beneficiary states in the region has been brought down to 35 per cent from 75 per cent.

''Currently, in addition to the 10 per cent preferential allocation, a host state also gets its share also from the 75 per cent allocation kept for beneficiary states in the region, making the effective share of the host state as up to 33 per cent. The cabinet reviewed the allocation formula and has today increased it to 50 per cent,'' said the power ministry official.

The government currently considers two factors before deciding the share of a state falling in the region of the host state - percentage of allocation of plan funds and the percentage of power consumption.
For more info- http://www.domain-b.com/industry/power/20110107_home_states.html