6 Jan 2012: Seoul, Tokyo look to sever Oil ties with Iran

FTSE 100 5644 Up 35bp
S&P 500 1281 Up 29bp
NIFTY 50 India 4761 Up 25bp

Major Stories

  • Seoul and Tokyo look for alternative Oil sources
    • Seoul and Tokyo are set to reduce the oil dependence on Iran
    • US have pressurised countries to stop buying crude oil from Iran, after Iran threatened to shut the Strait of Hormuz, one of the most important Oil-checkpoints in the world
    • With several European countries pushing for an embargo on Iranian oil trade, Crude Oil prices are set to shoot up
  • Klass Knot says Germany is biggest obstacle to Emergency Fund
    • Klass, ECB governer, appeals to Germany to help raise the Emergency Fund
    • Germany has focussed on budget discipline to stem crisis
    • The Euro 500bn fund is meant to be implemented early this year
  • European stocks rise again
    • STOXX, and SXXP gain for third week running just prior to US payroll data; at the same time Asian stocks have fallen
    • Vodafone Group gained 1.2% as STOXX rose 0.2%; STOXX has now rallied 15% from September last year

Stories from India (Compiled by Arun K Sam)

  • Bajaj enters the 4-wheeler market: Bajaj Auto are officially entering the 4- wheeler segment , with their new 200 cc car – RE 60 that was unveiled at the Auto expo 2012 New Delhi. The car is reported to first be exported to Srilanka and not be launched in India. This reminds us of Tata, when Nano was first launched in India on a first-come-first serve basis, with huge marketing extravaganza and also big media gimmicks. The car was a terrible failure technically as there were reports of Nano catching fire on road. This left the Tata’s to take a step back and move on to exporting the car to Srilanka which went on to be a big hit with the Srilankan customers. Bajaj have clearly piggybacked on the Tata’s initial failure to enter the market in a clever manner. Bajaj Auto stocks were trading flat after slumping 8 per cent in trade on Monday. The December 2011 sales data was below expectation.
  • The rise of TCS as the highest valued firm: With TCS topping Reliance as the highest valued firm in the country for the second time in a week, it is interesting to see how this company rose from a small Tata offshoot to one of the largest players in the domestic market. TCS’s maiden acquisition happens to be CMC limited (Computer Maintenance Corporation Private Limited) during 2001; it’s interesting to see how this deal has made TCS so strong. CMC started as a 100% Govt. of India enterprise; it was made public and then later Tata’s TCS took over 2001. CMC were pivotal in the originating some IT projects which have grown to now become an essential part of India’s IT infrastructure; a prime example is the computerization of Railways for its operation and management. Though TCS was far behind its competitors, Infosys and Wipro during the early 2000’s, the acquisition raised it to over throw many of its domestic and global competitors; clearly, TCS not only acquired an enterprising company but more importantly the intellectual potential of the company. Currently TCS has the largest private sector employees in the country.

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