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05 October 2018
I had mentioned in last week’s closing report that Nifty, Sensex might rise on relief rally. The major indices of the Indian stock markets suffered a correction on Friday and closed with weekly losses over last Friday’s close. The major trends of the Indian stock markets during the week’s trading are given in the table below:
The major indices of the Indian stock markets rallied on Monday. On the NSE, there were 725 advances, 1,034 declines and 318 unchanged.
Commercial vehicles major Ashok Leyland Ltd on Monday said it closed September 2018 with a 26% growth in sales. In a statement here, the company said it sold 19,373 units last month, up from 15,371 units sold in September 2017.
Pharma major Dr Reddy's Laboratories Ltd on Monday announced the sale of its antibiotic manufacturing facility and related assets in Tennessee, US, for an undisclosed sum.
Gayatri Projects has been awarded with two add-on works to the existing works of Chintalapudi Lift Irrigation Scheme (Package-1 & 2). These two additions lead to a consolidated increase of Rs548.98 crores, nearly 55% of the existing value.
On Tuesday, the stock markets had a holiday on account of Gandhi Jayanthi.
The major indices of the Indian stock markets suffered a correction on Wednesday. On the NSE, there were 1,033 advances, 753 declines and 276 unchanged.
Owing to a weak rupee and broadly negative global cues the S&P Sensex tanked over 500 points and the Nifty50 slipped by 130 points on Wednesday.
Automobile major Maruti Suzuki India has recalled over 600 Super Carry vehicles to inspect for a possible defect in the fuel pump assembly. According to the company, 640 vehicles in the domestic market, manufactured between January 20 and July 14, 2018, will be covered in this recall campaign.
Tata Communications, a leading global digital infrastructure provider, on Wednesday said it was acquiring Teleena, a Netherlands-based Internet of Things (IoT) connectivity specialist and mobile virtual network enabler (MVNE). This acquisition follows Tata Communications' investment in Teleena in January 2017, when the company became the single largest shareholder in Teleena with a 35% stake.
Software major Tech Mahindra on Wednesday announced a strategic partnership with ELTA Systems Ltd., a subsidiary of Israel Aerospace Industries (IAI), to provide next generation cyber solutions and services to state and enterprise customers in India and globally.
The S&P BSE Sensex, plunged over 800 points on Thursday, as a steady decline in the domestic currency and concerns that the central bank would raise the policy interest rate soured investor sentiments. The wider Nifty50 of the National Stock Exchange also lost 240 points. The Indian rupee earlier on Thursday sunk to its fresh low of 73.77 to a dollar, as global crude oil prices continued to climb. India imports nearly 80% of its crude requirements, and a higher price will potentially worsen the current account deficit of Asia's third-largest economy. The Reserve Bank of India will unveil its monetary policy on Friday, where it is likely to raise the repurchase rate by 25 basis points. The repo rate currently stands at 6.5%.
Global software major Tata Consultancy Services (TCS) on Thursday said it signed a Memorandum of Understanding (MoU) with the Institute of Industrial Science (IIS) at University of Tokyo to collaborate on technology research and facilitate inter-personnel exchange.
The Indian equity indices plunged on Friday, even though the Reserve Bank of India (RBI) changed its policy stance and kept key benchmark lending rates intact. The RBI was expected to raise rates. Apart from the policy decision, the free-fall in the Indian rupee's value to over 74 a US dollar eroded investor’s sentiments.
Announcing the fourth bi-monthly policy review of the fiscal, Reserve Bank of India (RBI) Governor Urjit Patel said the Monetary Policy Committee (MPC) has decided to keep the repo, or the short term lending rate for commercial banks, unchanged at 6.5%. Elaborating on the change to "calibrated tightening", the Governor said that it implied that "in this cycle, a rate cut is not the table and we are not bound to increase rates every time we meet." "With this stance we have two options, we can either increase rates or hold them," he said. A "neutral" stance allows the RBI to move either way on rates.
Reliance Capital Ltd. on Friday said its wholly owned Reliance Health Insurance has got the R3 approval from Insurance Regulatory Authority of India (IRDAI). Reliance Capital shares closed at Rs254.00, down 6.03% on the NSE.
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Friday 5 October 2018
Correction Gets Deeper. Relief Rally Likely – Weekly closing report-The Total Investment & Insurance Solutions
India's GDP growth may exceed RBI's projection of 7.4 pc in FY19: Economic Affairs Secretary-The Total Investment & Insurance Solutions
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05 October 2018
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| GDP growth (The Total Investment & Insurance Solutions) |
Economic Affairs SecretarySubhash Chandra
Garg Friday said the GDP growth is expected to be higher than the RBI's
projection of 7.4 per cent for the current fiscal. The Reserve Bank in its
fourth bimonthly policy review retained GDP forecast for 2018-19 at 7.4 per
cent based on an overall assessment.
"Government welcomes MPC statement and
decision to keep the rates unchanged. Government's assessment of inflation is
in line with the MPC's assessment. We believe growth should turn out to be
higher than that projected by MPC (monetary policy committee)," he
tweeted.
Later, the finance ministry in a statement
said the status quo decision by the MPC is in consonance with the government's
assessment of inflation and growth going forward and for achieving the
medium-term target for consumer price index (CPI) inflation of 4 per cent
within a band of +/- 2 per cent, while supporting growth.
"The government welcomes the MPC's
assessment and notes its decision to maintain the Policy Rate," the
statement said. On the basis of an assessment of the current and evolving
macroeconomic situation, the RBI maintained the status quo by keeping key
policy rate unchanged at 6.5 per cent.
The projections of inflation for 2018-19 and
first quarter of 2019-20 have been revised downwards from the August
resolution. The RBI lowered its retail inflation projection for the second half
of the current fiscal at 3.9-4.5 per cent mainly because of an unusually benign
trend in food prices.The Total
Investment & Insurance Solutions
India Signs $5 Billion Deal For Russian Air Defense Systems-The Total Investment & Insurance Solutions
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05 October 2018
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India signed a $5 billion deal to buy five Russian S-400 air defense
systems on Friday despite a looming threat of U.S. sanctions on countries that
trade with Russia's defense and intelligence sectors.
The deal was signed in New Delhi during a visit by Russian President
Vladimir Putin, who met with Indian Prime Minister Narendra Modi to discuss
nuclear energy, space exploration and trade.
India has requested that the U.S. grant it a waiver for the deal from
sanctions prescribed by the Countering America's Adversaries Through Sanctions
Act, a U.S. law passed in August 2017 that is intended to punish Russia for its
annexation of Crimea and alleged interference in the 2016 U.S. elections.
The U.S. did not spare China from sanctions last month for purchasing
its own Russian S-400 surface-to-air missile systems and fighter jets.
If the U.S. does impose sanctions on India, it is unclear how India
could pay Russia for the military equipment, since the law bars dollar-denominated
financial transactions.
Vladimir Sotnikov, a foreign affairs expert at an independent research
institute in Moscow, believes India could make the payment in a mixture of
rupees and dollars to try to circumvent the sanctions.
"I do not think that India would succumb to U.S. pressure over the
purchasing of the armaments from Russia," he said. "India has a very
sophisticated policy of separating the relationship between India and the U.S.
and India and the Russian Federation. And India is in a good negotiating
position right now."
The National Security Council at the White House said in a statement
that the Trump administration urges all "of our allies and partners to
forgo transactions with Russia that would trigger sanctions" under the
act, known as CAATSA.
"The administration has indicated that a focus area for the
implementation of CAATSA Section 231 is new or qualitative upgrades in
capability - including the S-400 air and missile defense system. Our recent
action to sanction a Chinese government entity for an S-400 delivery
underscores the seriousness of our resolve on this issue."
Officials with India's external affairs and defense ministries confirmed
the deal was signed after Putin and Modi made no reference to it during a news
conference following their talks.
An 11-page joint statement made only passing mention, saying that
"the two sides welcomed the conclusion of the contract."
The deal will likely bolster the close relationship between India and
Russia that dates back to the Cold War, when the U.S. tilted toward Pakistan,
India's neighbor and archrival. But it is also likely to strain ties with
Washington.
India is the world's largest importer of military hardware, according to
Mumbai-based think tank Gateway House, and has depended on Russia for political
support as well as billions of dollars in military hardware. Nearly 70 percent
of India's present-day defense equipment was procured from Russia, according to
India's Defense Ministry.
India's acquisition of the S-400 long-range missile systems has been
considered critical to countering a perceived threat from China, which is
increasingly making economic inroads throughout South Asia, India's traditional
sphere of influence, according to military experts.
"It gives the capability to destroy targets inside another country.
It's a very important capability," said retired Indian air force Air
Marshal Nirdosh Tyagi.
India has also developed closer defense ties to the U.S. in recent years
with joint military drills and defense sales.
India has signed more than $15 billion in U.S. defense contracts since
2008, including for C-130J and C-17 transport aircraft, P-8I maritime patrol
aircraft, Harpoon missiles and Apache and Chinook helicopters.The Total Investment & Insurance
Solutions
Private investments in infra plunge to 25% in FY18 -The Total Investment & Insurance Solutions
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05
October 2018
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Infrastructure sector (The Total Investment & Insurance Solutions)
The share of private investments in the
infrastructure sector has fallen to a decadal low of around 25 per cent in FY18
steeply down from a high of 37 per cent in FY08, says a report.
Private investments, which averaged 37 per
cent between fiscals 2008 and 2013, fell by 600 basis points (bps) between
fiscals 2013 and 2017 to 31 per cent, which fell a steep 600 bps further to 25
per cent in FY18, as a plethora of stalled projects and stressed assets
dampened investor interest and risk appetite.
"A material ramp-up in government
spending in the past few years has meant the share of private investments in
infrastructure has fallen to a decadal low of around 25 per cent in FY18,"
according to an Crisil InfraIndex.
This means that between fiscals 2008 and 2018,
there was a massive plunge of 1200 bps in private investments.
While the highways sector has seen a revival
in public private partnerships (PPPs), and the renewables sector some buoyancy,
private investments in other infrastructure segments have remained stagnant or
weak, the report said.
"Resumption and broad-basing of private
investments are critical to sustain the share of infrastructure investments at
around 6 per cent of GDP over a medium-to- long-term," Crisil managing
director Ashu Suyash said in the report.
"This requires new PPP frameworks,
expeditious resolution of stressed assets, and steps to deepen financing
sources," she said. According to the index, the highway sector saw the
biggest rise from 6.9 per cent in 2017 to 7.4 per cent in 2018, riding on
private sector interest in the hybrid annuity model (HAM) and success of asset
monetisation under the toll- operate transfer model.
It
said the scores of last year's toppers, power transmission and renewables,
lagged a tad given the high suo motu allocations to public sector in the
former, and policy and pricing headwinds in the latter. Ports and airports saw
an improvement, too, but conventional generation, power distribution and urban
infrastructure continue to lag, it said.
The Total Investment & Insurance Solutions
US Stocks Slide As Job Gains Send Bond Yields Even Higher-The Total Investment & Insurance Solutions
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05 October 2018
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| financial markets (The Total Investment & Insurance Solutions) |
The yield on the 10-year Treasury note has soared over the last three
days and hasn't been this high since mid-2011. Bond prices are falling as
investors sell them, but Wall Street is also concerned that spiking interest
rates could eventually slow the economy.
KEEPING SCORE: The S&P 500 index lost 18 points, or 0.6 percent, to
2,883 as of 11:45 a.m. Eastern time. The Dow Jones Industrial Average inched
slid 203 points, or 0.8 percent, to 26,423.
Technology companies and smaller, more U.S.-focused companies continued
to suffer steep losses. The Nasdaq composite skidded 101 points, or 1.3
percent, to 7,778 as technology and internet companies continued to struggle.
The Russell 2000 index lost 17 points, or 1.1 percent, to 1,629.
The Nasdaq has dropped 3.4 percent this week and the Russell has tumbled
4 percent. Both indexes are on track for their biggest drops since late March,
and the Russell is on pace for its lowest close since late May.
IT'S A LIVING: The Department of Labor said employers added
significantly more jobs in July and August that it previously thought, which
made up for a slightly disappointing gain in September. The September total was
probably reduced by the damage Hurricane Florence did to the Carolinas.
Employers have added 190,000 jobs on average over the last three months,
and the employment rate fell to its lowest level since December 1969.
Friday's data suggest the economy should keep growing at a strong clip,
which means corporate profits should continue to grow. That's a good sign for
stocks. At the same time, there are few signs of a big increase in the pace of
growth or inflation. Either of those would push the Federal Reserve to raise
interest rates at a faster pace, which would start to slow down the economy.
BONDS: Bond prices kept falling. The yield on the 10-year Treasury note
rose to 3.22 percent from 3.19 percent. The yield on the 10-year Treasury is an
important benchmark for longer-term interest rates and it hasn't been this high
since July 2011.
The decline in bond prices and increase in yields have led to big gains
for banks in the last few days because higher interest rates mean they make
bigger profits on mortgages and other loans. Bond yields in Europe also rose.
SWITCHEROO: The sell-off in technology and internet companies and
retailers continued. Intel lost 1.9 percent to $47.63 and Apple slipped 1.4
percent to $224.74 while Google's parent company, Alphabet, sank 1 percent to
$1,164.73. Among retailers, Netflix slumped 4.4 percent to $347.58.
Those sectors have been the biggest gainers on the S&P this year,
but have taken sharp losses this week. Banks and industrial and energy
companies, which have struggled in 2018, have changed place and performed
better than the broader market.
Banks were mixed Friday after big gains the previous two days. Online
brokerage E-Trade rose 0.9 percent to $52.95 while Goldman Sachs lost 0.9
percent to $225.45.
Several major banks will report their third-quarter results late next
week as the next round of company earnings gets underway.
UNFOLLOWED: Tesla stock fell 5.5 percent to $266.26 after CEO Elon Musk
taunted the Securities and Exchange Commission just a few days after he agreed
to settle an SEC lawsuit triggered by a tweet he sent in August.
As part of that settlement, Musk agreed to step down as chairman and
submit to oversight when he's communicating company news. His criticisms of the
SEC don't appear to be company news, but they may have worried investors who
hoped his feed would be a little more boring from now on.
Musk and Tesla are also paying $20 million each to end the lawsuit.
COSTLY: Wholesale club operator Costco gave up 3.7 percent to $223.08
after it said it discovered technology problems related to its financial
reporting processes. Costco said it is investigating, but hasn't found any
problems with its past earnings reports so far.
OVERSEAS: European stocks fell for the second day in a row. Germany's
DAX lost 1.1 percent and the CAC 40 in France dropped 0.9 percent. Britain's
FTSE 100 fell 1.2 percent. Bond prices in all three countries fell again
sending yields higher.
Japan's benchmark Nikkei 225 fell 0.8 percent and the Kospi in South
Korea dropped 0.3 percent. Hong Kong's Hang Seng fell 0.2 percent.
ENERGY: Benchmark U.S. crude rose 0.6 percent to $74.75 a barrel in New
York and Brent crude, the standard for international oil futures, picked up 0.3
percent to $84.81 a barrel in London.
CURRENCIES: The dollar slipped to 113.69 yen from 113.86 yen. The euro
dipped to $1.1514 from $1.1515.The
Total Investment & Insurance Solutions
Thursday 4 October 2018
Nifty, Sensex Selloff Continues – Thursday closing report-The Total Investment & Insurance Solutions
Contact Your Financial Adviser Money Making MC
04 October
2018
I had
mentioned in Wednesday’s closing report that Nifty, Sensex were again under
bear attack. The major indices of the Indian stock markets suffered a
sharp correction on Thursday and closed with losses over Wednesday’s close. On
the NSE, there were 445 advances, 1,323 declines and 295 unchanged. The trends
of the major indices in the course of Thursday’s trading are given in the table
below:
The
S&P BSE Sensex, plunged over 800 points on Thursday, as a steady decline in
the domestic currency and concerns that the central bank would raise the policy
interest rate soured investor sentiments. The wider Nifty50 of the National
Stock Exchange also lost 240 points. The Indian rupee earlier on Thursday sunk
to its fresh low of 73.77 to a dollar, as global crude oil prices continued to
climb. India imports nearly 80% of its crude requirements, and a higher price
will potentially worsen the current account deficit of Asia's third-largest
economy. The Reserve Bank of India will unveil its monetary policy on Friday,
where it is likely to raise the repurchase rate by 25 basis points. The repo
rate currently stands at 6.5%.
Global
software major Tata Consultancy Services (TCS) on Thursday said it signed a
Memorandum of Understanding (MoU) with the Institute of Industrial Science
(IIS) at University of Tokyo to collaborate on technology research and
facilitate inter-personnel exchange. Tata Consultancy Services shares closed at
Rs2,063.00, down 4.62% on the NSE.
State-run
ONGC has awarded a major work package worth Rs11,740.86 crore ($1,694.45
million) to a consortium of companies for integrated development of
"KG-DWN-98/2" project located on the East Coast. According to the
company, the consortium of BHGE, McDermott and L&T hydrocarbon has been
awarded the contract. "This tender is one of the biggest integrated
tenders awarded globally in recent years," the company said in a statement
on Wednesday. "ONGC envisages commencement of first gas production by
December 2019, first oil by March 2021 and overall project completion by August
2021." ONGC shares closed at Rs163.35, down 9.98% on the NSE.
NBCC
has received LoA (Letter of Assurance) worth Rs400 crore (approx.) from IIM
Ranchi to provide Project Management Consultancy for development of permanent
campus (Phase-1 works). NBCC (India) Limited shares closed at Rs56.20, down
2.43% on the NSE.
L&T
Hydrocarbon Engineering in consortium with Baker Hughes, a GE company and
McDermott International, Inc. has been awarded the subsea contract for ONGC's
(Oil and Natural Gas Corporation) largest deep-water oil & gas project -
'Development of block DWN-98/2 in the Krishna Godavari basin'. Larsen &
Toubro shares closed at Rs1,256.00, up 0.85% on the NSE.
GMR
Infra has emerged as the highest bidder for the Development, Operations and
Management of Dr Babasaheb Ambedkar International Airport, Nagpur on a Public
Private Partnership (PPP) basis. GMR Infrastructure shares closed at Rs16.15,
down 3.29% on the NSE.
The
top gainers and top losers of the major indices are given in the table below:
The
closing values of the major Asian indices are given in the table below:
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Major Indices (The Total
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