GLOBAL MARKETS UPDATE

Global Markets Update for March 15, 2011:

                                                                                                         

• Japan authorities said that an explosion inside part of the No. 2 reactor at the Daiichi nuclear power plant appears to have caused damage, and some staff have been evacuated from the facility as radiation levels at the site rose sharply.

• Japanese Prime Minister Naoto Kan said today that there is a high risk of elevated levels of radiation from a reactor at the Fukushima nuclear power plant that exploded earlier in the day & urged people within 30 kms of the plant to stay indoors.

• The Bank of Japan offered to inject JPY 5 tn in same-day funds into the money market, extending emergency efforts to calm financial markets that have been hit hard by concerns over the impact of Japan's unprecedented natural & nuclear disasters.

• Singapore's unemployment rate rose marginally to 2.2% on seasonally adjusted terms in Q4 as compared with 2.1% in Q3.

• India’s WPI inflation jumped unexpectedly in the month of February to 8.31% as compared to 8.23% in January against market expectations of a decline to 7.79%. The gains were led by manufacturing inflation which accelerated to 4.9% in February from 3.8%  in January.

• Fitch Ratings kept the UK at its highest possible rating, saying there were no immediate risks of a downgrade, although the country's economy remains fragile after the global financial crisis.

• The Reserve Bank of Australia viewed slower borrowing by households & businesses offsetting a mining investment boom when deciding to keep interest rate unchanged, the minutes of its March 1 meeting released this morning showed.

• Indian stock markets rallied during the last couple of hours yesterday to end the session on a strong note. Earlier in the day, the indices had opened on a soft note tracking mixed cues from Asian peers owing to Japan’s devastating earthquake. However, a drop in oil prices to below $100/bbl improved market sentiment, which saw the benchmark indices post a robust performance yesterday. Investors even shrugged off a more than expected rise in India’s February inflation data. All the sectoral indices closed in the green with metal, banking & IT stocks leading the pack.

• Overnight, the US stocks dropped 1% & closed in the red but off intra-day lows as in investors assessed the Japanese quake's damage to the world economy. The Dow closed below the key 12,000 mark.

• Today, Japanese shares slumped more than 14% as the Nikkei average dived to two-year lows, dragging down most other Asian markets as a fresh explosion rocked a stricken nuclear plant in the country's northeast. The Japanese prime minister said radiation levels there had become high & the possibility of radioactive leakage had increased., deepening concerns about the disaster & its likely economic toll. Indian shares plunged over 2% in early trade, joining the slide in other Asian markets rattled by the news of radiation leaks from quake-hit parts of Japan spreading fast. Automobile, realty & metal shares took a beating. India’s benchmark stock index plunged the most in more than two weeks.