Indian stock market- Has de-coupling happened???

Stock prices come tumbling down in the US, Europe and Asia, but Indian stock prices continue to climb, and the key indices are not far from their all-time highs. The financial and economic news gets from bad to worse in the United States, and the dreaded ‘R’ word (for recession) has begun to get used as the housing market tanks and employment numbers fall for the first time in four years. But Indian markets continue to bounce along, recovering by some 10 per cent from the trough it hit last month. Is it possible that the de-coupling thesis — which says that the Indian market will strike out on a different course from those in the west — is turning out to be true? If so, it would be a striking development, for until now the accepted wisdom was that the foreign institutional investors (FIIs) dictated, through their conduct, the direction of Indian stock prices. If they were investing, Indian prices went up; if they were selling, the prices fell. That no longer seems to be the case; or more correctly, the same institutional investors who are selling in other markets may be buying here. If true, that would mean, among other things, that as part of the “flight to safety”, global investors with a long-term outlook are looking for safe harbour in Indian bourses.

If these optimistic hypotheses are what explain current stock price trends in India, the underlying explanation can only be that the markets are responding to the strengths of the Indian economy. For one thing, the currency risk that is a standard element in emerging market assessments, is not the same any more as the rupee notches up gains against the dollar. But the more important reason is that the Indian growth story has so far been unaffected by the turmoil in global markets and its fall-out. The first-quarter GDP growth numbers have been flattering, industrial growth has maintained its tempo, and companies continue to do well. Exports have decelerated, but agricultural growth will be helped by the good monsoon. Such slowdown as has occurred so far has been on account of domestic factors, mainly the Reserve Bank’s response to the signs of overheating early in the year. Indeed, the onset of the sub-prime crisis in the US has helped India get rid of its problem of plenty, namely a flood of dollars that was adding to domestic money supply and making monetary policy difficult.

Of course, the current economic tempo cannot continue indefinitely; the July industrial production numbers are due this week and will give some pointers, as will the second-quarter corporate sales and profit numbers that will come early next month. But most analysts assume that even if there were to be a slowing of the current tempo, GDP growth in the year as a whole is unlikely to drop below 8.5 per cent — which would be very good going in a rocky global environment. What investors may not have fully recognised, though, is the full impact on corporate bottom line. For the moment, what seems to be true is that the hedge funds that have faced liquidity pressures overseas have been selling their Indian holdings, while long-term players among the FIIs have been busy picking up stocks. If this trend continues, the FII presence in the Indian market will have acquired a healthier hue as the role of the hedge funds gets diluted.

BS

Yahoo Mail lets e-mailers text-message to phones

Yahoo Inc said on Sunday it was giving its e-mail users more ways to reach friends and online contacts by allowing them to trade messages with mobile phone users.The new e-mail-to-phone connection is one of the features the Internet media giant plans to add as it makes available to the more than 250 million Yahoo Mail users a new version of the world's most popular e-mail program in coming weeks.

Already this year Yahoo has been testing another feature that lets its e-mail users communicate using conventional e-mail or via instant messages using either Yahoo Messenger or Microsoft Live Messenger.( Gmail has the facility long back though..)

Yahoo is scrambling to make its services more relevant as many Internet users spend more and more time on social networks like MySpace, YouTube and Facebook and less time passing through portals like Yahoo, AOL.com or Microsoft Corp's MSN.

The new version of Yahoo Mail gives users three options for communicating with contacts -- e-mail, online instant-messaging or text-messaging to mobile phone users. Users can switch between the three, depending on which is most convenient.

Initially, the text-messaging feature will be available to Yahoo Mail members in the United States, Canada, India and the Philippines. To text a friend, users simply enter a mobile phone number, type a text message in Yahoo Mail and hit send.

Yahoo Mail had 254 million users in July, according to audience measurement firm comScore Inc, while Microsoft Windows Live Hotmail had 224 million. Yahoo Messenger was used by 93 million in July.

Existing users will be prompted to upgrade, although users of slower dial-up connections or those comfortable with Yahoo's 'classic' e-mail can continue to use the older version.

The key difference with the older e-mail program is how the new service lets users 'drag and drop' e-mail into folders, speeding the time it takes to sort through incoming messages.

Search features are also improved, allowing Yahoo Mail users to narrow results to find a specific sender, folder, date, attachment type or message status. So a search can, say, find all photos in Yahoo Mail tagged with a person's name.