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Moody’s upgrade India’s rating
After upgrading the credit rating of Indian Government’s bonds from speculative to investment grade in less than a month’s time, Moody’s again on Tuesday upgraded country’s short-term foreign currency rating from speculative to investment grade. This would now help domestic companies to raise funds from overseas markets at better rates.
“... There has been another upgrade by Moody’s with the short-term country ceiling on foreign currency bank deposit increasing from NP (not prime) to Prime (P-3), suggesting acceptable ability to repay short-term obligations,” the Finance Ministry said.
The ‘P-3’ ratings suggest acceptable ability to repay short-term obligations.
The latest upgrade comes less than a month after Moody’s had upgraded the credit rating of Indian government’s bonds from speculative to investment grade, a move that was expected to encourage FIIs to increase their exposure in gilts and help companies raise funds from abroad at competitive rates.
On December 20 last year, Moody’s had upgraded short term government bonds denominated in domestic currency from NP not prime to P-3. Moody’s had upgraded rating on long-term Government bond denominated in domestic currency from Ba1 to Baa3 or from speculative to investment grade.
Besides, the long-term country ceiling on the foreign currency bank deposit was also upgraded from Ba1 to Baa3.
Giving rationale for the upgrade in December, Moody’s had at that side said, “Diverse sources of Indian growth have enhanced its resilience to global shocks”.
It had added the present slowdown “could reverse sometime in 2012-13, as inflation cools from current 9 per cent levels” The Finance Ministry had approached the ratings agencyseeking clarification regarding the ‘short-term country ceiling on foreign currency bank deposit’, which had not found mention in the earlier decision by Moody’s.
According to the ministry, the ratings firm has sent it a mail affirming an upgrade in that front as well.
“The Department of Economic Affairs (DEA) will continue to engage rating agencies on regular basis to impress upon them the long-term structural strengths and sound fundamentals of the Indian economy,” Joint Secretary in the Capital Markets division of (DEA) Thomas Mathew said.
Presently, six sovereign ratings agencies — Standard & Poor’s, Moody’s, DBRS, Fitch, Japanese Credit Rating Agency and the Rating and Investment Information Inc assigns ratings to India.
Sensex soars 350 PTS
Sensex surged by over 350 points to close at one-month high of 16,165.09 points on Tuesday on the back of upgrading of India’s rating to investment grade by Moody’s and likely rate cuts by RBI.
The rally was led RIL (3.99 per cent) and ICICI Bank (3.85 per cent) which together added over 100 points to the jump in Sensex.
In across-the-board buying, all 13 sectoral indices closed higher in the range of 0.59 per cent 4.20 per cent. Realty, banking, metal, auto stocks were among the biggest gainers, HDFC, L&T, ITC, SBI, M&M, Infosys Tech, Bharti Airtel, Tata Motors were the other significant stocks that ended up.
The 30-share index resumed higher on the back of positive Asian advices following better closing on the Wall Street yesterday.
It got a further boost when the news of Moody’s upgrading India’s rating filtered in. The key index never looked back and surged all the way to settle at 16,165.09, showing a sharp rise of 350.37 points or 2.22 per cent. This is highest closing level since December 9.
The 50-issue Nifty of the National Stock Exchange also flared up by 106.75 points or 2.25 per cent to one-month high of 4,849.55.
“Markets opened with a positive gap on favourable global cues. The US markets have closed in positive territory overnight. Interest rate sensitive sectors banking, realty and capital goods stocks were active today on hopes that the Reserve Bank of India (RBI) may lower rates in coming monetary policy on January 24,” said Shanu Goel Research Analyst Bonanza Portfolio said.
After upgrading the credit rating of Indian Government’s bonds from speculative to investment grade in less than a month’s time, Moody’s again on Tuesday upgraded country’s short-term foreign currency rating from speculative to investment grade. This would now help domestic companies to raise funds from overseas markets at better rates.
“... There has been another upgrade by Moody’s with the short-term country ceiling on foreign currency bank deposit increasing from NP (not prime) to Prime (P-3), suggesting acceptable ability to repay short-term obligations,” the Finance Ministry said.
The ‘P-3’ ratings suggest acceptable ability to repay short-term obligations.
The latest upgrade comes less than a month after Moody’s had upgraded the credit rating of Indian government’s bonds from speculative to investment grade, a move that was expected to encourage FIIs to increase their exposure in gilts and help companies raise funds from abroad at competitive rates.
On December 20 last year, Moody’s had upgraded short term government bonds denominated in domestic currency from NP not prime to P-3. Moody’s had upgraded rating on long-term Government bond denominated in domestic currency from Ba1 to Baa3 or from speculative to investment grade.
Besides, the long-term country ceiling on the foreign currency bank deposit was also upgraded from Ba1 to Baa3.
Giving rationale for the upgrade in December, Moody’s had at that side said, “Diverse sources of Indian growth have enhanced its resilience to global shocks”.
It had added the present slowdown “could reverse sometime in 2012-13, as inflation cools from current 9 per cent levels” The Finance Ministry had approached the ratings agencyseeking clarification regarding the ‘short-term country ceiling on foreign currency bank deposit’, which had not found mention in the earlier decision by Moody’s.
According to the ministry, the ratings firm has sent it a mail affirming an upgrade in that front as well.
“The Department of Economic Affairs (DEA) will continue to engage rating agencies on regular basis to impress upon them the long-term structural strengths and sound fundamentals of the Indian economy,” Joint Secretary in the Capital Markets division of (DEA) Thomas Mathew said.
Presently, six sovereign ratings agencies — Standard & Poor’s, Moody’s, DBRS, Fitch, Japanese Credit Rating Agency and the Rating and Investment Information Inc assigns ratings to India.
Sensex soars 350 PTS
Sensex surged by over 350 points to close at one-month high of 16,165.09 points on Tuesday on the back of upgrading of India’s rating to investment grade by Moody’s and likely rate cuts by RBI.
The rally was led RIL (3.99 per cent) and ICICI Bank (3.85 per cent) which together added over 100 points to the jump in Sensex.
In across-the-board buying, all 13 sectoral indices closed higher in the range of 0.59 per cent 4.20 per cent. Realty, banking, metal, auto stocks were among the biggest gainers, HDFC, L&T, ITC, SBI, M&M, Infosys Tech, Bharti Airtel, Tata Motors were the other significant stocks that ended up.
The 30-share index resumed higher on the back of positive Asian advices following better closing on the Wall Street yesterday.
It got a further boost when the news of Moody’s upgrading India’s rating filtered in. The key index never looked back and surged all the way to settle at 16,165.09, showing a sharp rise of 350.37 points or 2.22 per cent. This is highest closing level since December 9.
The 50-issue Nifty of the National Stock Exchange also flared up by 106.75 points or 2.25 per cent to one-month high of 4,849.55.
“Markets opened with a positive gap on favourable global cues. The US markets have closed in positive territory overnight. Interest rate sensitive sectors banking, realty and capital goods stocks were active today on hopes that the Reserve Bank of India (RBI) may lower rates in coming monetary policy on January 24,” said Shanu Goel Research Analyst Bonanza Portfolio said.
