Bulls may pull Nifty towards 17800, crucial support at 17300; 5 things to know before market opening bell Indian share market is likely to open higher as ahead of today’s trading session, SGX Nifty was in the green, hinting at a positive start for NSE Nifty 50 and BSE Sensex. With the US market being closed on Monday for the Labour Day holiday, equity traders would be looking for cues from Asian and other global markets for Tuesday’s session. “Markets have been showing tremendous resilience amid tough global conditions however it would be hard to hold if the situation deteriorates further. Banking and financial pack have played a critical role in capping the damage so far and their performance would remain the key ahead also as heavyweights like Reliance and IT majors are not showing any sign of respite,” said Ajit Mishra, VP – Research, Religare Broking.5 things to know before market opening bell Global market watch: Shares in the Asia-Pacific traded mixed at the open on Tuesday ahead of the Reserve Bank of Australia’s rate decision. Japan’s Nikkei 225 slipped 0.17 per cent and the Topix index lost 0.3 per cent. The Kospi in South Korea rose 0.14 per cent. In Australia, the S&P/ASX 200 was little changed. MSCI’s broadest index of Asia-Pacific shares outside of Japan inched 0.11 per cent higher. Meanwhile, US stock market remained closed on Monday on account of Labor Day holiday. Nifty technical view: “A reasonable positive candle was formed on the daily chart, which is placed beside the negative candle of Friday. Technically, this pattern indicates a range bound action for the market with positive bias. Presently, Nifty is stuck within a high low range of 17800 on the upside and 17300 levels on the downside. A sustainable buying could only emerge on the move above 17800 levels and the slide below the immediate support of 17300 could pull Nifty down to the next support of 17000 levels for the near term. However, the long term charts like weekly and monthly are still positive and one may expect any downward correction to be a buy on dips opportunity,” Nagaraj Shetti, Technical Research Analyst, HDFC Securities. Levels to watch out for: “Currently, the market is witnessing positive consolidation formation near the 20-day SMA (Simple Moving Average). The Nifty would see a key support level of 17550 and above the same it could move till 17750-17800. On the flip side, below 17550 a fresh round of selling could be seen and below the same, the index could slip till 17450-17400.” said Shrikant Chouhan, Head of Equity Research (Retail), Kotak Securities. As for Bank Nifty, support is at 39300, while resistance is placed at 40500, according to Om Mehra, Technical Associate, Choice Broking. FII and DII data: Foreign institutional investors (FIIs) offloaded net equities worth Rs 811.75 crore, whereas domestic institutional investors (DIIs) net bought shares worth Rs 533.77 crore on Monsay (September 5), according to the provisional data available on the NSE website. Also Read: Sensex, Nifty soar 1%, defies global mood; Nifty above 17550 support may hit 17800; check what analysts say Stocks under F&O ban on NSE: Delta Corp remains in the NSE F&O ban list for today as well. Securities in the ban period under the F&O segment include companies in which the security has crossed 95 percent of the market-wide position limit.
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In its consultation paper, Sebi has suggested that trustees of mutual funds should focus on market abuse by AMC, its employees and mis-selling by the AMC to increase the asset base.
Also, trustees should be responsible for fairness of fees and expenses charged by the AMC, compare its performance with peers and ensure that AMC’s sponsor is not getting any undue advantage.
In addition to the core areas, the trustees should be responsible for periodically reviewing the steps taken by AMCs for the folios which do not contain all KYC attributes with bank details.
Further, Sebi has suggested that trustees and their resource persons should independently evaluate the extent of compliance by AMC and not merely rely on AMC’s assurances.
To facilitate trustees’ supervision, AMCs should provide them with analytical information.
Presently, the trustees primarily rely on the AMCs for ensuring compliance with the applicable rules.
Under the rules, trustees hold the property of the mutual fund in trust for the benefit of the unitholders. The trustees appoint an AMC to float schemes for the mutual fund and manage the funds mobilised under various schemes, in accordance with the investment objectives.
“In view of the increasing scale and reach of the mutual fund industry, trustees’ role in respect of unitholders’ protection assumes even greater significance,” Sebi said on Friday.
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Over the past decade there has been a five-fold increase in the size of the mutual fund industry. The assets under management (AUM) has surged from Rs 7.93 lakh crore in November 2012 to Rs 39.89 lakh crore in December 2022.
To ensure that trustees devote time and attention to their core responsibilities, Sebi has suggested that for fulfilling other responsibilities, trustees may rely on professional firms such as audit firms, legal firms, merchant bankers for carrying out due diligence on their behalf.
The Sebi also listed some duties trustees can delegate to AMCs. This include ensuring that all systems are in place prior to the launch of any scheme by the AMC, and calculating any income in the mutual fund due to the fund and any income received in the mutual fund for unitholders.
The regulator has proposed to provide a one year time to existing trustees with board of trustee structure to convert into a trustee company, from governance point of view.
Presently, two structures for trustees are permitted — corporate and board of trustees structure. Moreover, there are a few mutual funds which have the board of trustees structure while the trustees of all other mutual funds have adopted the structure of a trustee company.
Considering the enhanced role of trustees over the period of time, Sebi has suggested to increase the minimum number of trustees to adequately perform their functions. Presently, the minimum number of trustees prescribed is four.
Also, it has been proposed that the chairperson of the trustee company should be an independent director.
Sebi has suggested that apart from the meeting of the audit committee of AMCs and trustees (which mostly comprises of independent directors), the board of AMCs and the board of trustees may be mandated to meet at least once a year to discuss the issues concerning the mutual funds.
The regulator proposed that the existing MF Regulations on AMC and its obligations may be amended to include additional clauses with respect to the obligations of the board of AMC.
The proposed amendment may include a clause which casts an obligation on the board of AMC to ensure that all the activities of the asset management company are in accordance with the provisions of these regulations.
The Securities and Exchange Board of India (Sebi) has sought comments from public till February 24 on these proposals.