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Think Ahead with EZWealth – 12 Oct 2021
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The market extended gains for the third consecutive session with the Nifty50 hitting the 18,000 mark for the first time, driven by banking & financials, auto, FMCG, and select pharma stocks. The broader markets also continued to run along with frontliners, as the Nifty Midcap 100 index was up 0.61 percent and Smallcap 100 index gained 1.16 percent.
FIIs net sold shares worth Rs 1303 cr, DIIs net sold shares worth Rs 373 cr
US stocks ended a choppy session lower on Monday as investors grew nervous ahead of third-quarter earnings reporting season. The Dow Jones Industrial Average fell 250.19 points, or 0.72%, to 34,496.06, the S&P 500 lost 30.15 points, or 0.69%, to 4,361.19 and the Nasdaq Composite dropped 93.34 points, or 0.64%, to 14,486.20.
Asian indices were trading weak with Hang Seng, Kospi and Taiwan Weighted down 1 percent each, while Nikkei and Straits Times fall 0.5 percent each.
Trends on SGX Nifty indicate a weak opening for the index in India with a 106-points loss. The Nifty futures were trading at 17,854 on the Singaporean Exchange around 07:25 hours IST.
1) The energy crisis, the coming winter and the release of pent-up pandemic demand have sent nations scrambling to stockpile fossil fuels, a move that portends a rebound for global carbon dioxide emissions this year.
The trajectory poses a new threat to the Paris Agreement goal of limiting global temperature increases to 1.5°Celsius. China, India and other developing economies are driving the demand for coal, but even the US is poised to increase its consumption of the dirtiest fossil fuel in almost a decade, according to a forecast from the International Energy Agency.
The energy crisis has been concentrated in the power generation sector. Shortages of natural gas and electricity have been especially acute in China and the UK emissions from electricity producers were already up 2.2 per cent globally between January and August versus the same period in 2019, driven by increases in China, India and Brazil, Carbon Monitor data shows.
2) With crude oil prices inching closer to the $85 mark and the greenback strengthening, the rupee on Monday depreciated sharply against the dollar, losing 37 paise to close at a 15-month low of 75.36. This is the first time the Indian currency has closed below the 75 level this year. Bonds sold off for the second straight session on Monday, driving up the yield on the benchmark to 6.345%, up 3 bps over Friday’s close and to the highest levels since April 17 2020.
Currency experts observed that apprehensions rising crude oil prices could push up the import bill, and narrow the current account surplus, are leading to the rupee’s weakness. Last Friday, the rupee had fallen by 20 paise to end at 74.99. Moreover, uncertainty surrounding the impact of the taper by the US Fed on capital flows, is adding to the nervousness. The Fed is expected to start normalising policy, by stopping purchases ofbonds, in November.
3) The Ministry of Civil Aviation has given a no-objection certificate (NOC) for the operation of Rakesh Jhunjhunwala-backed new airline ‘Akasa Air’ in India, a company statement said on Monday. The new airline aims to start operations by the summer of 2022, the holding company, SNV Aviation Private Limited, said.
Akasa Air is backed by ace investor Rakesh Jhunjhunwala and ex-Jet Airways CEO Vinay Dube. We are extremely happy and grateful to the Ministry of Civil Aviation for their support and for the grant of the NOC,” Dube, who is now the CEO of Akasa Air, was quoted as saying in the statement. “We will continue to work with the regulatory authorities on all additional compliances required to successfully launch Akasa Air,” he added. Akasa Air also has former IndiGo president Aditya Ghosh on its board. The airline plans to operate approximately 70 planes in the next four years.
4) Led by a sharp 249 percentage point rise in rural joblessness rate, India’s unemployment rate shot up to 8.86% for the week ended October 10 compared with 7.56% a week earlier, data complied by the Centre for Monitoring Indian Economy (CMIE) showed. The urban unemployment rate fell during the week to 7.5% from 8.73% a week ago.
“The increase in unemployment was in rural India last week. But, this is not a matter of much concern because the labour participation and the employment rate increased in rural India. The employment rate increased from 37% in the previous week to 38%. In urban India while the unemployment rate has dropped a bit, the employment rate has also dropped a bit. This is slightly worrisome. But, rural India provides comfort,” said CMIE’s MD and CEO Mahesh Vyas.
5) Coal shortage crisis at thermal power projects does not seem to abate very soon as the number of non-pit head plants with less than four days of dry fuel stock (supercritical stock) has increased to 70 this Sunday compared to 64 a week ago on October 3, as per government data.
India is facing an acute electricity crisis with just days of coal stocks left at power plants, the lowest in many years. Several regions across India have been hit by supply shortages in recent months, with utility providers resorting to unscheduled power cuts.
Coal accounts for nearly 70% of India’s electricity generation and around three-quarters of the fossil fuel is mined domestically. Heavy monsoon rains have flooded coal mines and disrupted transport networks, leading to a sharp rise in prices for coal buyers, including power stations. International coal prices have also soared.
Stocks in the news today:
Invesco, the largest shareholder of Zee Entertainment Enterprises (ZEEL), has raised questions over the company’s proposed merger with Sony Pictures, saying the transaction is not in the best interest of all shareholders and will benefit only the promoters, who have defaulted on bank loans.
The US fund said the non-binding agreement between ZEEL and Sony “gifts” a 2 per cent equity stake to the promoters of Zee in the guise of “non-compete” fee, even though the current managing director and chief executive officer, Punit Goenka, would continue to run the merged entity for the next five years.
Bharti Airtel and Vodafone Idea have moved telecom tribunal to challenge Telecom Department’s demand notices for payment of Rs 3,050 crore cumulative penalties in the points of interconnect matter, a source said. The Department of Telecommunications (DoT) had recently issued demand notices to both the telcos to pay cumulative Rs 3,050 crore in penalties in three weeks’ time for violating norms by denying Reliance Jio points of interconnect (PoIs) way back in 2016.
India’s largest port operator Adani Ports and Special Economic Zone (APSE.NS) said on Monday that its terminals would no longer handle export and import of container cargoes from Iran, Pakistan and Afghanistan from Nov. 15. The decision comes weeks after Indian officials seized nearly three tonnes of heroin originating from Afghanistan worth an estimated 200 billion rupees ($2.65 billion) from two containers at western Gujarat’s Mundra Port, run by Adani Ports.
Bharti Group‘s OneWeb on Monday announced a pact with the commercial arm of Indian Space Research Organisation (Isro) to launch satellites from the country. Bharti Enterprises Chairman Sunil Mittal said OneWeb would be the first private player to launch satellites from India through Isro facilities.
State-owned Coal India on Monday said it has scaled up the supply of coal to power utilities across the country to 1.51 million tonnes (MT) per day during the past four days of the current month, and stressed that it is building up adequate evacuation logistics to transport the dry fuel. The development assumes significance in the wake of reports that warned of a power crisis looming large due to the coal shortage in the country.
Macrotech Developers has formed five joint ventures since April to develop projects having sales potential of Rs 4,500 crore and is targeting to enter into five more such tie-ups with landowners by the end of this fiscal. Mumbai-based Macrotech Developers, one of the leading real estate developers in the country, markets its properties under the ‘Lodha’ brand.
Tata Motors on Monday reported a 24 per cent increase in group global wholesales, including that of Jaguar Land Rover (JLR), to 2,51,689 units in September quarter of FY22 over the year-ago period.
Global wholesales of all Tata Motors’ commercial vehicles and Tata Daewoo range in Q2FY22 were at 89,055 units, up 57 per cent over Q2FY21, Tata Motors said in a statement. Global wholesales of all passenger vehicles in the September quarter of the current fiscal increased 11 per cent to 1,62,634 units over the corresponding quarter of the previous fiscal, it said.
Delta Corp: The company posted consolidated loss at Rs 22.57 crore in Q2FY22 against loss of Rs 54.91 crore in Q2FY21, revenue jumped to Rs 74.72 crore from Rs 38.37 crore YoY.
HFCL: The company reported higher consolidated profit at Rs 85.94 crore in Q2FY22 against Rs 53.32 crore in Q2FY21, revenue rose to Rs 1,122.05 crore from Rs 1,054.32 crore YoY.
PI Industries: The company has executed two joint venture agreements with Polymath Holdings, LLC for undertaking the business of manufacturing and selling the products for bio chemistry processes and bio chemical enabled pharmaceutical intermediates.
Tata Metaliks: The company reported lower profit at Rs 54.62 crore in Q2FY22 against Rs 82.20 crore in Q2FY21, revenue rose to Rs 644.84 crore from Rs 519.63 crore YoY.
Krsnaa Diagnostics: The company reported lower consolidated profit at Rs 12.52 crore in Q2FY22 against Rs 34.12 crore in Q2FY21, revenue fell to Rs 108.26 crore from Rs 240.7 crore YoY.
Ujjivan Small Finance Bank: The bank reported gross loan book at Rs 14,508 crore in Q2FY22 against Rs 13,890 crore in Q2FY21, total deposits increased to Rs 14,090 crore from Rs 10,743 crore YoY.
Sharika Enterprises: The company has received a contract to design, supply, install, commission and maintain feeder automation system as part of distribution management system (DMS) to improve the reliability of the power distribution in Jammu and Kashmir. The contract has been awarded by General Electric Company’s India Entity GE T&D India as an associate partner, and is valued at Rs 42.10 crore.[/vc_column_text][vc_column_text]
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