New US home sales spike 18.9%, hit 10-year high in September

Sales of new US single-family homes unexpectedly rose in September, hitting their highest level in nearly 10 years, offering hope that the housing market was regaining speed after appearing to stall recent months.

The Commerce Department said on Wednesday new home sales surged 18.9 per cent to a seasonally adjusted annual rate of 667,000 units last month amid an increase in all four regions. That was the highest level since October 2007 and followed August's upwardly revised sales pace of 561,000 units.

The percent gain was the largest since January 1992. August's sales pace was previously reported at 560,000 units.

Economists polled by Reuters had forecast new home sales, which account for 11 per cent of overall home sales, falling 0.9 per cent to a pace of 555,000 units last month.

New home sales, which are drawn from permits, are volatile on a month-to-month basis. Sales soared 17.0 per cent on a year-on-year basis in September. The housing market has trod water for much of this year, amid shortages of homes available for sale, skilled labour and suitable land for building.

Activity was also hampered by Hurricanes Harvey and Irma, which weighed on homebuilding in September and hurt sales of previously owned homes in the South. Housing is expected to have been a drag on economic growth in the third quarter.
READ MORE

Starbucks shares tumble on fears of slowing US growth

Starbucks Corp's shares were on track for their worst one-day decline in five years on Friday as the coffee chain's latest quarterly report triggered concerns of a slowdown in sales in the United States, its biggest market.

While Starbucks' profit met Wall Street expectations in its first quarter under new CEO Kevin Johnson, the results suggested that growth in the coffee chain's member loyalty program was slowing, a trend that could impact future sales.

Starbucks' U.S. rewards membership rose 8 percent in the quarter ended July 2 — a rate that lags the 18 percent increase seen a year earlier and slower than the previous quarter's 11 percent rise.

"Customers were choosing to spend their money elsewhere, Johnson told CNBC on Friday, calling it a "short-term phenomenon."

But analysts said the slowdown was a direct result of changes Starbucks made to its rewards program, that, while benefiting the company, left many customers unwilling to sign up.

Starbucks last year tweaked the program to award customers points for every dollar spent at its cafes, a departure from its practice of giving points for every purchase, putting customers buying cheaper items at a disadvantage.
READ MORE

Note ban impact: Cash situation to become normal in March, says Nomura

Latest News -The impact of demonetisation is still visible and cash levels in the economy are not expected to be sufficient until March, which may keep trade volumes depressed for the next two months, says a Nomura report.

As per data released by the commerce ministry, growth in exports in January was lower than 5.72 per cent in December.

The moderation in India's exports volume suggests that demonetisation may still be affecting cash-intensive export sectors, Nomura said in a research note, adding that "we do not interpret this as a sign of reduced competitiveness".

"We expect trade volumes to remain subdued for another month or two as we do( Read More)

Patanjali to invest Rs 5,000 crore in four units

Latest News - Fast-growing swadeshi consumer goods company Patanjali Ayurved planned to start producing at four new facilities that would come up in 500 days at an investment of Rs 5,000 crore, the company’s Chief Executive Officer Bal Krishna told Business Standard.

The Project 500 encompasses food and herbal parks in Gautam Buddh Nagar (Uttar Pradesh), Nagpur (Maharashtra), Tezpur (Assam) and Indore (Madhya Pradesh). The facility in Assam is expected to be operational by March and the other parks will start production by mid-2018.

The food park in Uttar Pradesh, which would cater to the National Capital Region, would need an investment of Rs 1,400 crore in two phases, Bal Krishna said. The first phase would be ready by Diwali, he added.

An average sales growth rate of (Read More)

Consumption, Employment, Growth: Three-point agenda for Budget 2017

Latest News - The Budget 2017-2018 is not only being advanced by a month but also amalgamates the Railway budget with the Union Budget. Coming in the backdrop of impending election in the states of UP and Punjab and in the aftermath of demonetisation, we believe consumption, employment and growth could be key themes of the budget this year.

While demonetisation has made a bold start by channelizing the idle cash in the economy into the banking system, it needs to be followed through with measures to improve tax compliance and initiatives to boost the digital payment economy.

We believe it is an opportune time to boost consumption demand and business sentiment, which has shown some weakness following demonetisation. A hike in the personal tax limits can be a measure which helps towards this end. The government has rightly focused on boosting the low cost housing segment with interest subsidies and we believe that some  tax exemptions   on (Read More)