11 Vertis Wins Outsourcing Deal
The Washington DC Examiner reports it will outsource its printing to FNP Inc., Frederick, MD, and to a Vertis Inc. plant in Belcamp, MD. Direct mail and insert printing giant Vertis, recently merged with American Color, also announced its CEO Mike DuBose will resign, naming Stephen Dyott, former American Color CEO, vice chairman and Alex Sorokin interim president. Examiner Publisher Michael Phelps says the newspaper's existing plant was no longer state-of-the-art and would be closed; 101 employees will loss their jobs. He notes that it was not economically feasible to upgrade the facility and outsourcing would reduce costs and allow for more full-color pages. The transition is scheduled to be completed by the end of January.
4th December 2008, www.tutorial-reports.com

12 Attacks in Mumbai could force execs in U.S. to rethink outsourcing plans 
The fallout from the recent terrorist attacks in Mumbai, India, will most likely be felt in the U.S. boardrooms, as officers and directors reassess the risks involved in running outsourcing operations in that tension-wracked country. Granted, it’s not likely many U.S. businesses will immediately cancel outsourcing contracts with Indian vendors in the wake of the attacks, which may have killed over 300 people. As Financial Week reported in its special three-part series on outsourcing (see box with related articles), India has become the preferred outsourcing destination for U.S. corporations, with American businesses sending approximately $24 billion in technology work to Indian cities such as Mumbai, Kolkata, Chennai, Hyderabad and Bangalore in 2008. All told, U.S. companies will probably ship around $36 billion in outsourcing assignments (including IT and non-tech work) to India this year, reckons Sanjay Puri, president of the U.S. India Business Alliance.
5th December 2008, www.bbc.co.uk

13 Recession Trickles to India   
After years of being blamed for job losses in America and elsewhere, India’s high-tech companies and outsourcing firms are going through a downturn of their own. The global slowdown is forcing them to reduce hiring, freeze salaries, postpone new investments and lay off thousands of software programmers and call center operators. Namas Bhojani for The New York Times Students at the Indian Institute of Management in Bangalore face a tight market. While some industry insiders insist the global crisis will actually benefit companies here, as Western businesses seek to cut costs by moving jobs overseas, right now the sector is suddenly gripped by an unfamiliar sense of uncertainty. It’s certainly not irrational exuberance, said Nandan Nilekani, co-chairman of Infosys, one of India’s best-known technology outsourcing firms. “There is a lot of introspection about what does this mean and when does it end.
6th December 2008, www.tutorial-reports.com

14 India's Infosys to freeze new hiring as growth slows 
Infosys Technologies Ltd will freeze recruitment after meeting this fiscal year's target of hiring 25,000 staff, a telling sign the global downturn is hitting India's $52 billion outsourcing sector. India's second largest software services firm however has no plans to cut jobs and is sticking with its third quarter outlook, CEO Kris Gopalakrishnan told reporters. He said the outsourcing sector's growth rate would halve next year as some customers delay orders. Last year the IT industry grew more than 30 percent, this year it is looking at somewhere in the region of 15 percent, Gopalakrishnan said. India's export-driven IT sector, used to a scorching pace of growth, has been hit by the financial crisis and recession in the United States, which contributes more than half their revenue. In the last few years, the outsourcing industry has created tens of thousands of jobs, mainly attracting young workers, as global companies look to trim labour costs. Infosys hired 16,000-17,000 employees in the first half of the fiscal year that began in April and would honour commitments to 6,000 under training, Gopalakrishnan said.
7th December 2008, www.tutorial-reports.com

Global Economy

15 ECB cuts eurozone rates to 2.5%
The European Central Bank has delivered a record rate cut, lowering the key interest rate for the 15 countries that use the euro to 2.5% from 3.25%. The cost of borrowing was cut for a third consecutive month as the central bank tries to bolster the eurozone's faltering economies. Central banks worldwide are cutting interest rates dramatically to stave off a protracted recession. Earlier, the Bank of England reduced interest rates to 2% from 3%. Sweden's central bank cut its key interest rate by a record 1.75 percentage points to 2% on Thursday and monetary policymakers in Denmark and New Zealand also reduced the cost of borrowing. Official statistics have confirmed that the eurozone is in a recession and recent economic data has been grim.
4th December 2008, www.bbc.co.uk

16 US Fed demands foreclosures push
US Federal Reserve chairman Ben Bernanke has called on the government to take action to stem the increasing number of home foreclosures. He said banks should consider reducing existing mortgages by writing down negative equity in people's homes. The Fed chairman said the government had several options, all using public funds, that could reduce foreclosures. Weakness in the housing market has proved a serious drag on overall economic activity, he added. Despite good-faith efforts by the private and public sectors, the foreclosures rate remains too high. Mr Bernanke said several solutions were being examined, which would allow borrowers who fell behind with their mortgage payments to stay in their homes. One solution, said the Fed chairman, would be for the government to offer home loans at lower rates to problematic borrowers.
5th December 2008, www.bbc.co.uk

17 Japan oil rivals in merger deal
Japan's top oil refiner, Nippon Oil, is merging with smaller rival Nippon Mining Holding in an attempt to weather falling oil prices and weak demand. Their shares jumped 14% before the announcement, bringing their combined market value to $8.6bn (£5.7bn). The new company is expected to cut costs by up to $1.1bn a year, the two firms said. Oil prices have fallen more than $100 a barrel from their record levels in July because of the global financial crisis. The two companies plan to reduce their combined oil refining capacity by 400,000 barrels a day, or 20%, by April 2012, Nippon Oil president said. Nippon Oil and Nippon Mining Holding said they also needed to improve their ecological measures to respond to consumer concerns.
5th December 2008, www.bbc.co.uk

18 Petrol cheaper by Rs 5, diesel by Rs 2
The Government on Friday cut prices of petrol and diesel by Rs 5 and Rs 2 a litre, respectively, as an interim measure while watching the international prices before effecting more cuts. As an interim measure, the Government has decided to cut the prices with effect from midnight tonight, Petroleum Minister Murli Deora said. There is no change in the prices of LPG (cooking gas) and kerosene. The Government had in June raised the prices of petrol and diesel by Rs 5 and Rs 3 a litre, respectively and that of LPG by Rs 50 a cylinder to protect oil marketing firms against losses on account of a rally in crude prices.
6^th December 2008, www.financialexpress.com

19 Yes Bank cuts PLR by 0.50%
New generation lender Yes Bank said that it has reduced its prime lending rate by 0.50 per cent with effect from December 8. After our asset-liability committee meeting today, we have decided to reduce our PLR by 0.50 per cent, the bank's Managing Director & CEO, Rana Kapoor, told PTI here. The private sector lender is the first bank to announce a PLR cut after the RBI cut both its repo and reverse repo rates by one per cent each today. The bank's PLR accordingly stands reduced to 16.5 per cent from the earlier 17 per cent.
7^th December 2008, www.financialexpress.com

20 Indo-Pak trade hits new low after Mumbai attacks
With India-Pakistan relations touching a new low after terror attacks on Mumbai, bilateral exchange of trade and ministerial delegations as a part of the political composite dialogue has been put off indefinitely. Minister of State for Commerce Jairam Ramesh who was to visit Islamabad and Karachi either in the first or second week of January, has "more or less" cancelled the tour. India had earlier given two sets of date for Ramesh's visit which was to take place before the secretary-level talks. "It was either January 5-9 or 13th onward," he said. While the Commerce Ministry would be approaching the Ministry of External Affairs on the issue, an official said, I don't think the MEA would give a go-ahead for the next few months. Besides, the commerce secretary-level talks which were due in Islamabad are in a jeopardy. "Things are in the hands of MEA now," the official said. Several trade opening issues had been discussed in the previous rounds of talks.
7^th December 2008, www.financialexpress.com

Global Market

21 Gold futures fall for 5th day on global cues
Indian gold futures fell for a fifth consecutive session on Thursday taking a cue from global markets, analysts said. We are still bearish on gold, said Devarsh Vakil, manager, research, at Ahmedabad-based Anagram Capital Ltd. Gold slipped on Thursday as the dollar gained against the euro and worries about demand weighed on oil, driving investors away from bullion ahead of the release of US nonfarm payrolls data later this week. Adding to the decline would be a firm rupee, Vakil added. A stronger rupee makes gold imports cheaper and brings down domestic prices. The Indian rupee strengthened slightly in the morning as expectations of an economic stimulus package, inflows into the share market and a drop in oil prices to their lowest in nearly four years, boosted sentiment.
4^th December 2008, www.financialexpress.com

22 Rupee appreciates to 49.76 per dollar
The Indian rupee on Friday further appreciated by 11 paise against the US dollar in early trade, the fourth rise in a row, on increased dollar selling by exporters and banks amid firming Asian equity markets. At the Interbank Foreign Exchange (forex) market, the domestic unit rose by another 10 paise to 49.76 against the greenback in opening trade. The rupee had gained 14 paise to end the day at 49.86/87 against the dollar on Thursday. Dealers attributed the rupee's gain to increased dollar selling by banks and exporters after a surging trend in global equity markets. Asian markets today opened on a positive note with Hong Kong's Hang Seng moving up 1.93 per cent while Japan's Nikkei rising 0.51 per cent in early trade.
5^th December 2008, www.financialexpress.com

23 Oil jumps 4 pct to above USD 42
Oil jumped 4 per cent to above $42 on Monday, clawing back a share of the near-record decline last week when negative economic data heightened fears about the impact of a global recession on fuel demand. With few signs of immediate economic improvement, traders said the best chances for a rebound in oil prices more than $100 off their peaks rested with a US. auto sector bailout and next week's OPEC meeting in Algeria. US. crude for January delivery rose $1.59 to $42.40 a barrel by 0202 GMT after closing on Friday at $40.81, the lowest settlement since Dec. 10, 2004. Oil shed a quarter of its value last week, the sharpest weekly fall since January 1991. London Brent crude rose $1.71 to $41.45 a barrel.
6^th December 2008, www.bbc.co.uk

24 SEBI restricts early exit from close-ended funds
Securities and Exchange Board of India (SEBI) on Thursday said investors won't be allowed to exit from close-ended mutual fund schemes before maturities and asked fund houses to list them on stock exchanges. For all close-ended schemes, no early exits will be provided by the funds, SEBI Chairman C. B. Bhave told a media briefing following a board meeting earlier in the day. All schemes will have to be listed on the stock exchange, he added.
6^th December 2008, www.financialexpress.com

25 European resource stocks take a beating
European equities tumbled this week as investors took stock of an increasingly bleak economic picture and offloaded commodities stocks in response to a grim stream of data. Further pressure came after the US employment department announced more than half a million jobs were lost in the world’s biggest economy in November. The pan-European FTSE Eurofirst 300 index sank 4 per cent to 793.94, bringing its drop for the week to 7.9 per cent as the latest figures from France showed its unemployment rate had hit 7.7 per cent in the third quarter. The more acute the damage in the labour market, the more pronounced the likely retrenchment in consumer spending, said Daragh Maher at Calyon.
7^th December 2008, www.ft.com

26 Merrill warns oil prices could fall to $25
Merrill Lynch warned that oil prices could fall as low as $25 a barrel next year if the recession affecting the US, Europe and Japan extended to China, the main driver of demand growth in commodity markets in recent years. Oil prices failed to recapture the $44 a barrel mark on Friday, having moved underneath it on Thursday to their lowest levels in almost four years in spite of dramatic interest rates cuts in the UK, Europe and Sweden.
7^th December 2008, www.ft.com

Compiled by:
Himanshu Gupta
BBA (MAHE) L3,S2 - 3rd Year
Skyline Business School
Hauz Khas Enclave, New Delhi 110 016
Tel: 2686 4848, 2686 6968
www.SkylineCollege.com