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https://www.moneycontrol.com/news/business/economy/covid-19-pandemic-us-consumer-spending-tumble-in-april-5334861.html | US consumer spending dropped by a record in April as the COVID-19 pandemic undercut demand, buttressing expectations that the economy could contract in the second quarter at its steepest pace since the Great Depression.
The Commerce Department said on Friday consumer spending, which accounts for more than two-thirds of U.S. economic activity, plunged 13.6 percent last month. That was the biggest drop since the government started tracking series in 1959, and followed a 6.9 percent tumble in March.
Economists polled by Reuters had forecast consumer spending plummeting 12.6 percent in April.
Follow our full coverage of the coronavirus pandemic here. | consumer spending plunges 13.6 percent in April. that was the biggest drop since the government started tracking series in 1959. consumer spending accounts for more than two-thirds of economic activity. economists polled by Reuters had forecast consumer spending plummeting 12.6 percent. a spokesman for the u.s. government said the data was not available. | Negative |
https://www.businesstoday.in/top-story/state-run-banks-need-urgent-capital-of-rs-1-trillion-due-to-weak-market-valuations-crisil/story/288921.html | State-run lenders require an urgent Rs 1.2 trillion in the capital in the next five months and government will have to take a bulk of the tab due to the weak market valuations of these NPA-saddled banks, says report.
This is a little more than double the budgeted Rs 53,000-crore of capital infusion for the current fiscal year, Crisil senior director Krishnan Sitaraman said in a report Tuesday.
If the government decides to meet this need, this will put further pressure on the fiscal maths, thus its ability to meet the 3.3 per cent fiscal deficit target for the current fiscal year. Already the government has used up over 95 per cent of the deficit target or the market borrowings as of October end.
The report comes even as the government is asking the Reserve Bank to lower the minimum capital requirements by getting it at par with global practices-something the central bank is uncomfortable to meet.
It has also reported having turned down the finance ministry demand to transfer Rs 3.6 trillion of it's over Rs 9.5 trillion reserves, which government wants to use to recapitalise the bleeding banks.
Till now, only Rs 1.12 trillion have been infused into these lenders since October 2017, it said, adding just Rs 12,000 crore has come from the markets, it said.
Most of the required capital has to be infused into the 11 lenders who are under the prompt corrective action (PCA) framework of the RBI, wherein depletion in the capital and return on assets, combined with a surge in non-performing assets, has resulted in the severe restrictions on normal operations, it said.
"Given their weak performance and low valuations, state-run banks have little ability to tap the market, which means the government will have to provide most of the requirement," it said.
Sitaraman said the Rs 1.5 trillion infused by the government in the last three financial years has only helped them cover the losses of Rs 1.3 trillion incurred during the same period.
Profitability of state-run banks has been under pressure because of higher credit costs after the RBI tightened norms for recognition of stressed assets and their resolution, the report explained.
Most of the 21 state-owned banks have reported huge losses in recent years, and a good number of them will be in the red this fiscal as well which will put a strain on the capital, notes the report.
As per the norms, the banks ought to have their tier-I capital at 9.5 per cent, including the capital of conservation buffer (CCB) of 2.5 per cent, it said, adding if the CCB were to be excluded, the capital requirement will fall to Rs 40,000 crore from Rs 1.2 trillion.
Meeting the CCB requirement, introduced following the 2008 global financial crisis, is becoming difficult for many state-run banks and those under PCA have had to recall their additional tier-1 bonds in recent times impacting their capital adequacy, it said.
Thirteen of the 21 state-owned banks had their tier-I ratio below the regulatory norm as of the June quarter, the report noted.
Moves like the consolidation of weaker banks with stronger ones like the tri-merger between Bank of Baroda, Dena Bank and Andhra Bank will help reduce the additional capital required, its associate director Vydianathan Ramaswamy said.
Listing other imperatives, he said the quantum of capital infusion has to increase, risk-weighted assets need to be brought down, and better-performing banks have to be nudged towards the market for capital. | government will have to take a bulk of the tab due to weak market valuations, report says. this is more than double the budgeted Rs 53,000-crore of capital infusion for current fiscal year. government has already used up over 95 per cent of the deficit target or the market borrowings. report comes as the government is asking the Reserve Bank to lower the minimum capital requirements. | Negative |
https://www.financialexpress.com/economy/covid-19-apparel-exporters-body-pitches-for-amnesty-scheme-for-non-fulfilment-of-export-obligations/1902593/ | Apparel exporters on Wednesday urged the government to bring an amnesty scheme in case there is non-fulfilment of export obligations as traders are facing issues in terms of raw material supply on account of the coronavirus outbreak.
Under some export promotion schemes like Advance Authorisation and Export Promotion Capital Goods schemes, import of machines and raw materials used to make exportable products is allowed at zero duty but with an export obligation.
Exporters are of the view that in such a scenario, meeting these obligations would be a bit difficult for them.
In a letter to Commerce and Industry Minister Piyush Goyal, Apparel Export Promotion Council (AEPC) Chairman A Sakthivel said apparel trade is deeply integrated with the global value chain and it has been impacted by the disruption in both imports and exports.
Uncertainties are developing over timely deliveries of imports of raw materials like fabric, and accessories supplies, and exporters are facing tough situation with regard to export orders as global buyers are asking for deferment of consignments.
He said the need of the hour is to “bring out an amnesty scheme for non-fulfilment/short-fulfilment of exports under various export obligation schemes, especially in a force-majeure (unforeseeable circumstances that prevent someone from fulfilling a contract) situation such as the present one”.
Sakthivel added that the current situation warrants urgent remedies and support from the commerce ministry.
“Since the last one week, many of the major brands and buyers from the US and EU have asked for postponement of orders or shipments which have completely upset our business and schedule,” Sakthivel said.
He added that such uncertainties, coupled with a weak demand position in major markets have started impacting the order position, production schedules, inventory pile up, working capital and export realizations. | exporters are facing issues in terms of raw material supply on account of the coronavirus outbreak. some export promotion schemes allow import of machines and raw materials used to make exportable products at zero duty but with an export obligation. a letter to commerce and industry minister Piyush goyal said apparel trade is deeply integrated with the global value chain. a weak demand position in major markets have started impacting the order position, production schedules, inventory pile up, working capital and export realizations. | Negative |
https://www.moneycontrol.com/news/business/markets/asias-mood-tested-by-trumps-tariff-threats-3221631.html | Asian shares battled to extend a global rebound on Tuesday after US President Donald Trump seemed to quash hopes of a trade truce with China, dampening risk appetite across the region.
Japan's Nikkei managed to edge up 0.4 percent, but MSCI's broadest index of Asia-Pacific shares outside Japan was all but flat.
E-Mini futures for the S&P 500 eased back 0.35 percent, after rising sharply overnight.
In an interview with The Wall Street Journal, Trump said he expects to move ahead with raising tariffs on $200 billion in Chinese imports to 25 percent from 10 percent currently.
Trump said it was "highly unlikely" he would accept China's request to hold off on the increase, planned for Jan. 1.
The comments ran counter to recent speculation about a possible deal when Trump meets with Chinese President Xi Jinping at the G20 summit in Buenos Aires later this week.
"Trump's pessimistic view on the chances of a game-changing China trade deal may puncture global equity markets' optimistic start to the week," said Sean Callow, a senior FX analyst at Westpac in Sydney.
"Combined with last week's harsh report from the U.S. trade representative, investors have only the flimsiest hope that the Trump-Xi meeting in Argentina will amount to more than a hill of soybeans."
That put trade-sensitive currencies, including the Australian dollar, on the defensive, while the dollar lost some ground on the safe haven yen to 113.47.
The euro edged up a shade to $1.1333 and the dollar dipped to 97.038 against a basket of currencies.
OIL SHIFTS RISKS ON INFLATION, FED
Shares in Apple Inc fell after-hours in reaction to Trump's comments that tariffs could also be placed on laptops and iPhones imported from China.
Trump's remarks came just as the mood among investors had shown signs of brightening and Wall Street took heart from an upbeat holiday shopping period.
Even oil managed to regain a little ground after the gut-wrenching slide of recent weeks.
The Dow ended Monday up 1.46 percent, while the S&P 500 gained 1.55 percent and the Nasdaq 2.06 percent.
The rally came after the S&P 500 on Friday recorded its lowest close in six months, down more than 10 percent from September's peaks and back in "correction" territory.
In commodity markets, oil prices had climbed nearly 3 percent on Monday in what was seen as largely a technical correction after weeks of losses.
Early Tuesday, US crude was off 4 cents at $51.59 a barrel. Brent crude futures had closed up $1.68 at $60.48 a barrel.
Analysts at National Australia Bank noted the steep retreat in oil would drag on US inflation in coming months, perhaps offering further reason for the Federal Reserve to go slower on tightening.
"This is a starkly different picture to just a few months ago," said NAB's market strategist Tapas Strickland.
"A stable to lower inflation outlook means there is no urgency for the Fed to hike rates," he added. "An early 2019 pause is thus becoming more probable."
The futures market has already shifted to imply two more hikes at most next year, while the Fed itself is predicting three and more in 2020.
Ears will thus be pricked for a speech by Fed Vice Chairman Richard Clarida later on Tuesday, ahead of an appearance by Chair Jerome Powell the day after. | the dollar loses some ground on the safe haven yen, while the dollar drops a shade. the dollar loses some ground on the safe haven yen, while the euro edges up a shade. the rally comes after the u.s. president said he expects to raise tariffs on $200 billion in china. the u.s. dollar loses some ground on the safe haven yen, while the dollar drops a shade. | Negative |
https://www.financialexpress.com/industry/six-psus-now-fallen-angels-after-indias-sovereign-rating-downgrade-covid-19-took-toll-says-moodys/1985892/ | After India’s sovereign credit rating fell to lowest investment grade ‘Baa3’ early in June, six Indian public-sector undertakings (PSUs) have also taken a hit with them now becoming potential “fallen angels”. These six companies in the non-financial sector viz — Indian Oil Corporation, Hindustan Petroleum Corporation, Oil India, Petronet LNG, Bharat Petroleum Corporation and Oil and Natural Gas Corporation — are now just one step away from being considered junk, global ratings agency Moody’s Investors Service said on Tuesday. “Fallen Angels” are those companies which were earlier in the investment grade category and have slipped to sub-investment grade.
As the coronavirus pandemic has afflicted markets and economy around the world, the Asian list of potential “fallen angels” has reached an all time high of 21 in early June owing to the addition of six Indian PSUs, the agency said. The quantum of names in the list has doubled due to the COVID-19 pandemic. The 21 Asian companies, which now risk becoming fallen angels, have over $12.3 billion of outstanding bonds maturing in 2021. Of this $12.3 billion, about one-fourth at $3.3 billion are rated. The six Indian companies which have been added to the potential “fallen angels” category are state-run enterprises in the oil and gas sector. They have $1 billion of rated bonds coming up for repayment till 2021, the agency said.
India leaves China behind, but, that is no good news
Since 2008, Chinese companies have dominated the “fallen angels” list which has lately become a domain of Indian and South Korean companies.
Moody’s downgraded its rating on India by a notch recently after worries over growth and the fiscal strain abound. India’s current rating is the last level in the category classified as “investment grade”. “The country’s policymaking institutions will be challenged in enacting and implementing policies which effectively mitigate the risks of a sustained period of relatively low growth, significant further deterioration in the general government fiscal position and stress in the financial sector,” Moody’s said in a statement after downgrading India rating. However, the effect of the cut is likely to be short term on investment flows. | six Indian public-sector undertakings have taken a hit with them now becoming potential "fallen angels" the Asian list of potential "fallen angels" has reached an all time high of 21 in early June. the 21 Asian companies, which now risk becoming fallen angels, have over $12.3 billion of outstanding bonds maturing in 2021. of this $12.3 billion, about one-fourth at $3.3 billion are rated. | Negative |
https://www.moneycontrol.com/news/business/markets/wall-street-falls-on-powells-grim-outlook-5263621.html | Wall Street's main indexes fell on Wednesday after Federal Reserve Chairman Jerome Powell warned of an extended period of weak growth and stagnant incomes due to the coronavirus pandemic.
It will take some time for the U.S. economy to get back to where it was, Powell said in a webcast, and called for more fiscal stimulus.
"Powell's doing the right thing by warning people that this is not just going to be a V-shaped recovery," said Sam Hendel, president and co-portfolio manager of New York-based Levin Easterly Partners.
"I think the market may be overstating the ease of returning back to normal."
However, Powell made it clear that the Fed won't push interest rates below zero, as traders had been increasingly betting.
The three main U.S. stock indexes have climbed about 30 percent from their March lows as investors bet on a pickup in business activity after various states eased virus-induced lockdowns that have caused mass layoffs and disrupted supply chains.
However, the rally paused this week on fears of a second wave of COVID-19 infections following a spike in new cases in Germany, South Korea and China and a warning from a top U.S. health expert.
At 11:31 a.m. ET, the Dow Jones Industrial Average was down 307.23 points, or 1.29 percent, at 23,457.55, the S&P 500 was down 26.48 points, or 0.92 percent, at 2,843.64. The Nasdaq Composite was down 48.44 points, or 0.54 percent, at 8,954.12.
Energy dropped 2.5 percent, the steepest percentage losses among the 11 major S&P sectors. Interest rate-sensitive banks stocks shed 4 percent, tracking a slight drop in U.S. Treasury yields.
Wall Street's fear gauge rose for the second day to hit a one-week high.
"Volatility is likely to persist because there's a lot of uncertainty on how this virus plays out," said Brian Levitt, Global Market Strategist for Invesco.
Royal Caribbean Cruises launched a $3.3 billion bond offering, pledging 28 of its ships as collateral and forecast heavy losses for the first quarter. Its shares fell 6.8 percent.
Declining issues outnumbered advancers for a 4.22-to-1 ratio on the NYSE and for a 3.32-to-1 ratio on the Nasdaq.
The S&P index recorded two new 52-week highs and 10 new lows, while the Nasdaq recorded 28 new highs and 71 new lows. | main indexes fall after jerome p. o'connell warns of slowing growth. o'connell: "this is not just going to be a V-shaped recovery" obama: "we're going to have to wait until the end of the year" a top health expert warns of a second wave of COVID-19 infections. | Negative |
https://www.financialexpress.com/money/real-estate-revival-holds-key-to-building-a-stronger-economy/1935475/ | It was largely expected. With a view to curb the spread of Covid-19, the 21-day lockdown which was imposed earlier across the country has been extended by another 19 days albeit with partial relief given after 20th April in some parts or regions of the country. The biggest pandemic faced by mankind in over a century, which originated in China and soon engulfed the entire world including most of the developed as well as developing nations, has impacted one and all. With restriction on the movement of people as well as goods & services, barring some of the essential services, the economic activities are currently at a standstill. Needless to say, the lockdown would have a jeopardising impact on the economy.
The Early Growth Indicators
There is a near consensus amongst most of the economists that World economy would slip into recession, with many of them even predicting that the current slowdown would be far worse than that of 2008 financial crisis and next only to ‘Great Depression’. The IMF’s Economic Counsellor has named it the ‘Great Lockdown’ and has estimating the cumulative loss to global GDP over 2020 and 2021 at around $9 trillion, which is greater than the economies of Japan and Germany put together.
Thankfully, India is among the handful of countries that is projected to record positive growth and at 1.9%, India’s growth rate is projected to be the highest among the G-20 nations.
Measures unveiled by Government & Authorities
To curb the impact of pandemic, Governments and authorities across the globe have announced several relief measures. The United States has passed a record $2 trillion Corona relief package. Other countries have also announced similar measures.
Domestically, the Indian government too has announced a relief package to the tune of Rs 1.7 lakh crore, which is mostly aimed at economically weaker section of the society. Compared to relief package announced by some of the major economies, the relief package announced by India is much smaller as it is merely 2% of the GDP as compared to relief packages of the US, Japan, UK & others wherein it is to the tune to 10-12% of GDP. Thus, there is greater expectation that the government would soon unveil another relief package for industries.
The Reserve Bank of India too has done its bit. It has already announced several measures in two tranches. Complementing the Government’s efforts, the apex bank towards the end of March lowered repo rate by 75 basis points to 4.4% and infused liquidity in banking system to the tune of Rs 3.74 lakh crore. It also lowered the reverse repo by 90 bps to 4%. It also announced moratorium of 3-month on repayment of all term loans, including retail loans and on advances to MSMEs.
With the economic growth scenario remaining under cloud, the apex once again intervened on April 17 and announced further reduction in reverse repo to 3.75% besides providing additional liquidity of Rs 1 lakh crore to NBFCs and All India Financial Institutions like NABARD, SIDBI & NHB. It has also announced certain relaxation on loan classification and provisioning as well.
Real estate may offer panacea for economy
One of the reasons that the Indian economy is struggling to attain 7.5-8% kind of growth is the state of real estate. The last few years have been challenging for the sector as it underwent tremendous transformation due to Demonetisation, RERA and GST implementation. The Covid 19 is further likely hit the sector hard, with some of the reports suggesting extreme pessimism regarding the sector.
But as Mahatma once famously said: “In the midst of death life persists, in the midst of untruth truth persists, in the midst of darkness light persists.” – the sector still remains the second largest employer and is an essential cog in India Inc, with close to 300 industries relying on it for growth purposes. Thus, it is utmost important that some measures are announced to revive the sector, which in turn may immensely benefit the economy.
a) One Time Loan Restructuring
One of such measures could be developers’ long-pending demand of restructuring of existing loans for a period of 12 months. Amid the challenging times, the sales of housing units have remained subdued for the last couple of years. This in turn has adversely impacted the loan repayment capacity of a substantial chunk of developers. The unrest caused by Covid 19 is further likely to aggravate the situation. Thus, it would be apt that the Government or the Reserve Bank of India announces one-time loan restructuring for 1 year. This would ensure that developers would have sufficient liquidity at their disposal, which would enable them to turn the tide. Also, with no defaulter tag, developers would be able to raise additional finance from various institutions. Needless to say, it would help in faster completion of project and would create substantial employment opportunity.
b) Waiver of Stamp duty
The other major initiative, which may help the sector revive, is waiver of stamp duty for a limited time period. With stamp duty being one of the biggest sources of revenue, various state governments have substantially hiked circle rate over the years. In many of cases, the hike is not in sync with market realities. As such, stamp duty based on unrealistic circle rate is a major deterrent in buying of properties. Thus, it would be apt that states waive off stamp duty for a limited period. The move would help in the revival of the sector.
c) Special Window for HFCs/ NBFCs
Banks have been reluctant to finance realty projects over the last few years. In absence of it, the sector has heavily relied upon NBFCs and HFCs for its financial requirements. But post the IL&FS as well as DHFL fiasco, even that source of funding has dried up to a large extent. Even some of the HFCs and NBFCs are facing liquidity squeeze. In the wake of the same, providing a special window of finance for HFCs/ NBFCs would not only help them at this critical juncture, but in turn would help in the revival of the realty sector as well.
And there is little doubt, if real estate is able to get its mojo back, the Indian economy would also return to its 8-plus per cent growth rate soon.
(By Harvinder Singh Sikka, MD, Sikka Group) | the 21-day lockdown which was imposed earlier across the country has been extended by another 19 days. partial relief given after 20th April in some parts or regions of the country. the biggest pandemic faced by mankind in over a century has impacted one and all. with restriction on the movement of people as well as goods & services, the economic activities are currently at a standstill. | Negative |
https://www.moneycontrol.com/news/india/listen-to-ex-pm-manmohan-singhs-advice-on-economy-shiv-sena-tells-centre-4406091.html | BJP's ally Shiv Sena has backed former Prime Minister Manmohan Singh, who recently said that the Indian economy is in a bad shape due to "mismanagement" by the Narendra Modi-government, and said that listening to him is in the "national interest."
Sena's support for Manmohan Singh, a noted economist, came after the Centre dismissed his criticism of handling of the economy by the Modi-government. The Sena, through an editorial in party mouthpiece Saamana, asked the government to pay heed to the former PM's warning and not indulge in politics over the issue.
Last week, Manmohan Singh had termed the state of the economy as "deeply worrying" and said that the June quarter growth rate of 5% shows that India is in the midst of a prolonged economic slowdown. "India has the potential to grow at a much faster rate, but all-round mismanagement by the Modi government has resulted in this slowdown," Singh said in a statement.
Also read | Govt's 'all-round mismanagement' has resulted in slowdown: Manmohan Singh
However, the government rebuffed Singh's criticism on Tuesday, saying it does not subscribe to his analysis as India has now become the world's fifth-largest economy from 11th during his time.
"The economy is in doldrums. Kashmir and economic slowdown are two different issues. A learned person like Manmohan Singh there should be no politics around the economic slowdown and experts should be roped in to repair the economy. National interest lies in listening to Manmohan Singh's advice," the editorial in Saamana said.
Also read | Check economy figures during UPA rule, Anurag Thakur tells Manmohan Singh, Chidambaram
The Sena said that Singh has the "right" to speak about the economy as he has been associated with Indian finance and economy for over 35 years.
The editorial cited PM Modi's 2017 raincoat remark on Singh and said, "Prime Minister Modi had said 'Manmohan Singh bathes wearing a raincoat', but we don't have qualms in admitting that he knows about economy and finance. He has worked hard to revive the economy when it was in a bad shape."
The Sena once again cited demonetisation and the Goods and Services Tax (GST) as the main reasons for the slump in the economy. "The noteban failed and the GST has become a noose around the necks of businessmen and industrialists; there is a state of panic in the industry," it said. | BJP's ally Shiv Sena backs former pm manmohan Singh. the former pm recently said the economy is in a bad shape due to "mismanagement" the government rebuffed Singh's criticism on Tuesday, saying it does not subscribe to his analysis. the BJP has a close ally with a former prime minister. | Negative |
https://www.moneycontrol.com/news/business/markets/fiis-turn-net-sellers-in-indian-markets-but-it-is-not-because-of-budget-4885251.html | Foreign institutional investors (FIIs) have turned net sellers, pulling out more than Rs 2,000 crore in from Indian markets in the past four days. The move was not on account of the Budget but on global growth concerns, say experts,
Finance Minister Nirmala Sitharaman will table the Budget on February 1. The Nifty has slipped more than 1 percent, so far, in January, and about 3 percent from the record high of 12,430 recorded on January 20.
A snapshot of the 10-day activity of foreign investors suggests that the consensus seems to be short in index futures largely because of global growth concerns fuelled by coronavirus outbreak.
The World Health Organization on January 30 declared the coronavirus epidemic in China a public health emergency of international concern, said a Reuters report. Most economists have already lowered the growth forecast for China by 100-200 bps.
“FIIs are selling aggressively in the Indian equity market for the last few days but it has no correlation with the upcoming Union Budget because they are pulling out their money from emerging markets amid fear of short-term economic slowdown due to worries over coronavirus,” Amit Gupta, Co-Founder, TradingBells, told Moneycontrol.
“It is a global issue which is worrying FIIs because as per past behaviour, emerging markets tend to underperform amid such kinds of issues. FIIs are not only selling in the cash market, they are also betting on the short side via the F&O market,” he said.
Gupta added that FIIs have 60% net short positions in the index futures and these shorts may help in the short-covering rally if something major positive comes up in the Budget.
Even the rollover activity for the February series suggests a cautious stance by traders ahead of the big event.
The Nifty rolls stood near 66.30 percent, compared to the three-month average of 72.13 percent. Market-wide rolls stood at 86.45 percent against the 3-month average of 90.19 percent.
“As the D-Day of Budget 2020 draws nearer, FIIs have pulled back 2,371 crores of funds from the market in order to reduce their exposure and analyse the market. The last few days have been full of quarterly results thereby causing required price changes,” said Gaurav Garg, Head of Research at CapitalVia Global Research Limited- Investment Advisor.
“The Federal Reserve fixed the rate between 1.50-% 1.75%, FIIs seem to be planning to wait for perfect opportunities and invest in handpicked value stocks on the Budget Day and afterward.”
What will cheer FIIs in Budget?
Investors are pinning hopes on some relaxation in personal tax and tweaks in the Long-Term Capital Gains (LTCG) and the Dividend Distribution Tax (DDT). A low fiscal slippage will also make FIIs happy, say experts.
“The abolishment of LTCG and the rationalisation of DDT may change FIIs' sentiments for the Indian equity market. If the government comes out with any major reforms to boost consumption in the economy, then FIIs will once again head towards the Indian equity market,” says Gupta of Gupta TradingBells.
“There are some worries about the fiscal deficit but if the government will be able to give proper road map that it will manage to bring back the fiscal deficit in a comfortable range in the future then FIIs will be happy,” said Gupta.
He added that there is a high demand from the FIIs community from the government to come out with significant steps to strengthen the Indian financial sector which is the key worry of foreign investors for the last one year.
Disclaimer: The views and investment tips expressed by investment experts on moneycontrol.com are their own and not those of the website or its management. Moneycontrol.com advises users to check with certified experts before taking any investment decisions. | foreign institutional investors (FIIs) have turned net sellers, pulling out more than Rs 2,000 crore in from Indian markets in the past four days. the move was not on account of the Budget but on global growth concerns, say experts. the Nifty has slipped more than 1 percent, so far, in January, and about 3 percent from the record high of 12,430 recorded on January 20. | Negative |
https://economictimes.indiatimes.com/news/economy/policy/can-cci-be-more-agile-like-its-eu-and-us-counterparts-in-disposing-of-cases/articleshow/72201833.cms | Three meetings, two hotels, one city. These were crucial to an eight-month-long investigation by the Competition Commission of India CCI ) in 2010 and 2011 to expose a cartel in India’s cement industry, which resulted in a penalty of Rs 6,317 crore, the regulator’s highest in a single case to date.The CCI has since carried out many probes into alleged anti-competitive agreements and companies’ abuse of their dominant position, but it is still best known for the cement cartel case mainly because of the eye-popping fine. It is nearly half of the Rs 13,523 crore the CCI levied in 135 cases till March 2018, according to the latest data available with the regulator. Of its total fines, the CCI has collected a mere Rs 55 crore, or 0.4%.Compare this to the US Department of Justice (DoJ), which collected $172 million in criminal penalties in fiscal year 2018 (October-September), with the highest ever being $3.6 billion in fiscal year 2015. It has also sent several executives to prison.While the CCI cannot boast figures like DoJ, the very fact that it has the authority to severely penalise violators could be working to its advantage. Meanwhile, some of the recommendations made by the Competition Law Review Committee (CLRC), which submitted its report recently, could make CCI more nimble in the resolution of cases and take it a little closer to its counterparts in the EU, the UK and the US.It was in 2010, almost a decade ago, that the CCI, which had only become operational in May 2009, decided to probe its most high-profile case — to find out if 10 cement companies colluded through the Cement Manufacturers Association (CMA) to limit supplies and raise prices. The CCI said that after two of three CMA meetings at Mumbai’s Grand Hyatt and Hotel Orchid in early 2011, the companies hiked cement prices, which, the CCI said, “establishes that they co-ordinated their decisions and fixed prices after due consultations”. There were also questions over whether Ambuja Cement and ACC, which are part of the Swiss company LafargeHolcim, had attended two of these meetings despite no longer being members of the CMA.The companies and the CMA disputed the CCI’s findings and appealed the penalty. The case has made its way through the Competition Appellate Tribunal, the National Company Law Appellate Tribunal ( NCLAT ), which replaced the former in 2017, and is now pending before the Supreme Court, which asked the parties to deposit 10% of the penalty last year. Aparna Dutt Sharma, secretary general, CMA, did not respond to a request from ET Magazine for comment. Questions sent to Lafarge-Holcim, UltraTech Cement and Jaiprakash Associates, which were handed the highest penalties, also went unanswered.The delay in the conclusion of this case — and others where fines were levied — has meant that companies have not coughed up what the CCI asked them to. Should that be a cause for concern? Kaushal Kumar Sharma, the first director-general of the CCI, says it would be wrong to equate deterrence to realisation of penalties. Vaibhav Choukse, partner, competition law, J Sagar Associates, concurs. “Companies do not want to be on the wrong side of the competition law as there is a huge reputational loss from a penalty.” A listed company will have to make disclosures to the stock exchanges in case it is fined by the CCI, which could drive its shares down.“It’s not that the CCI wants to make money. The CCI’s idea in the early days was to make a splash and say, ‘We have arrived,’” says a competition lawyer, requesting anonymity. Nisha Kaur Uberoi , national head of competition law at Trilegal, a law firm, says the CCI has created deterrents through a combination of factors: “its ability to levy India’s highest economic penalties on companies, imposition of individual liability as well as advocacy to foster a culture of competition compliance”. By individual liability, she is referring to the CCI’s powers to penalise the directors of an errant company.Ashok Kumar Gupta, chairman, CCI, recently told ET that penalties are not an end in themselves in any enforcement process. “In numerous cases, parties rectify their anti-competitive behaviour during the enquiry process itself so the market correction as such has taken place.”As of March 2018, the CCI had noted 940 competition cases, ordered probes into 400 and completed investigations in 288. Even before the cement cartel case, a CCI order in 2011 gave India Inc an inkling of the regulator’s powers. It investigated the realtor DLF’s conduct in relation to one of its apartment buildings in Gurgaon and found that the company had set terms unfavourable to buyers in their agreement, like their inability to raise objections to changes in the structure by the builder. The CCI report added: “Despite knowing that necessary approvals were pending at the time of collection of deposits, DLF Ltd inserted clauses that made exit next to impossible for the buyers.”The CCI fined DLF Rs 630 crore, which the realtor appealed; the matter is now in the apex court. Also before the Supreme Court is an appeal related to a Rs 591 crore penalty on Coal India for discriminatory terms in fuel-supply agreements. DLF and Coal India did not respond to questions sent by ET Magazine. Besides looking at anti-competitive agreements like cartels and abuse of dominance, the CCI also has to greenlight mergers and acquisitions beyond a certain size. The CCI, set up under the Competition Act, 2002 (amended in 2007), replaced the Monopolies and Restrictive Trade Practices Commission.The CLRC, which the government set up last year, has recommended a series of changes to the CCI. These include a dedicated NCLAT bench for competition cases, given that NCLAT is overburdened with cases under the Insolvency and Bankruptcy Code (IBC), 2016. Though there is no NCLAT-specific data, as of September 30, there were nearly 1,500 IBC cases pending before the NCLAT or the Supreme Court, according to the Insolvency and Bankruptcy Board of India.Some of the report’s suggestions could make the CCI dispose of cases quickly. The introduction of settlement and commitment procedures, for instance, could help avoid pendency of cases. In the EU, which has had settlements since 2008, half the cartel cases are resolved using settlements, in which the parties admit to their guilt in exchange for a 10% reduction in penalties. Since 2004 the EU has also had commitments, in which the parties agree to change their behaviour. The US DoJ has consent decrees, which need to be court-approved.Another recommendation made by the CLRC is that the CCI should be transparent in how it arrives at penalties, like in the EU and the UK. “It’s as if the CCI is pulling figures out of a hat,” says Aditya Bhattacharjea, professor at the Delhi School of Economics and a member of the CLRC.The CCI, according to CLRC recommendations, can levy a penalty of up to 10% of the average turnover of the preceding three years in matters related to abuse of dominance. In case of cartels, it can impose a fine of up to 10% of their turnover or up to three times their profit in each year of the period during which the cartel existed, whichever is higher. “Having penalty guidelines will be good for the CCI when it has to defend its orders in courts,” says the competition lawyer quoted earlier.Regardless of when these recommendations are incorporated into the law, experts say companies could make use of an existing provision to minimise a crippling penalty. A company engaged in an anti-competitive agreement with its competitors can alert the CCI to the existence of the cartel and cooperate in the investigation in the hopes of being waived a part, or the whole, of its fine.Panasonic Energy utilised the lesser penalty option and went to the CCI in 2016 and admitted that it was part of a cartel with Eveready Industries and Indo National (which sells under the Nippo brand), aided by their industry association, to control the distribution and prices of zinc-carbon dry cell batteries, since 2008. Eveready and Indo National also availed of the lesser penalty provision. As a result, the CCI waived 100% of Panasonic’s Rs 75 crore penalty, and reduced Eveready’s and Indo National’s fines by 30% and 20%, respectively, to Rs 172 crore and Rs 42 crore.Cracking down on cartels without one of the participating companies coming forward is not easy, especially since in some cases the CCI may not have more than circumstantial evidence to base its conclusions on. An even bigger challenge is dealing with violations in the fast-evolving world of technology.Acting on information filed by Jaipur-based Consumer Unity & Trust Society and Matrimony.com, the CCI in 2018 fined Google Rs 136 crore for promoting its own specialised search — say, for flights — to the detriment of other websites. The order was stayed by NCLAT. Google is also being probed by the CCI for tying some of its apps to Android and limiting handset makers’ ability to sell devices with alternate versions. “Android has enabled millions of Indians to connect to the internet by making mobile devices more affordable. We look forward to working with the CCI to demonstrate how Android has led to more competition and innovation, not less,” says a Google India spokesperson.Google’s dominance has been under scrutiny in the EU and the US as well. Since 2017, it has been fined a total of $9.3 billion by the EU in three different cases related to its abuse of dominance by favouring its advertising and shopping services over its competitors’ and for bundling some of its applications with Android. (Google has appealed all three orders.) It is also being investigated in the US and so are Facebook and, reportedly, Amazon. “Other than in the EU, competition regulators are exercising caution (with tech companies) because consumers are benefiting from these companies,” says Bhattacharjea.While India may have got a competition authority later than several other countries, new technologies are coming to India soon after they are launched elsewhere. This is why Sharma, former CCI director general, believes that handling tech matters may not be too hard for the CCI. One of the emerging areas of concern for competition regulators worldwide is artificial intelligence-powered pricing algorithms of competitors colluding to fix prices. Who is to be held responsible here in the absence of executives of rival companies acting in tandem?In addition to instances of cartelisation and abuse of dominance in the old-economy sectors, the CCI will have to increasingly deal with competition cases in businesses like ecommerce, ridehailing, food delivery and online travel aggregation (the CCI is currently investigating MakeMyTrip and Goibibo, which merged in 2017, and Oyo Rooms over allegations of predatory pricing, among others). The CCI has also made clear its intent to pursue cases on its own without a formal complaint. But what is unlikely to change, till the CLRC recommendations are implemented, is the time it takes for a case to reach its conclusion. | competition commission of india investigated a cement cartel in 2010 and 2011. regulator's highest in a single case to date was Rs 6,317 crore. of its total fines, the CCI has collected a mere Rs 55 crore, or 0.4%. of its total fines, the CCI has collected a mere Rs 13,523 crore. | Negative |
https://economictimes.indiatimes.com/industry/telecom/telecom-news/jio-to-become-indias-no-1-telecom-operator-by-2021-bernstein-report/articleshow/67027316.cms | Agencies
Kolkata: Reliance Jio Infocomm is poised to race ahead of Vodafone Idea and Bharti Airtel to emerge as India’s No. 1 telco by revenue share and customers by 2021 and 2022, respectively, brokerage Sanford C Bernstein said.The Mukesh Ambani-led telco, it said, would relentlessly continue to subsidise its popular 4G VoLTE feature phone, called JioPhone, till these twin goals are realised.“Shareholders of Reliance Industries (Jio’s parent) are not complaining, preferring to see Jio continuing to gain share, and we believe neither Airtel nor Vodafone Idea have the stomach to engage in a pointless subsidy war,” Bernstein said in a note to clients.The global brokerage, in fact, expects the two older carriers to look forward to a time when Jio would start monetising its (customer) base through higher pricing after wresting market leadership.Jio’s pricing aggression since its entry in September 2016 forced incumbents to match rates to retain customers, galvanising consumption of voice and data services. Big incumbent carriers were hurt, while fringe players that couldn’t withstand the brutal price war exited and the sector consolidated down to three large private players — Vodafone Idea and Bharti Airtel, among the older ones, and Jio.More recently, strong performances in crucial states and rural mobile markets, have seen Jio boost revenue market share (RMS) by as much as 375 basis points (bps) sequentially to over 26% at the end of September. By contrast, Airtel’s RMS dipped 75 bps to 30.9% amid revenue losses in seven key markets, while VIL’s plunged 190 bps on-quarter to 32.8%, amid revenue slides nearly across India.Jio’s recent Monsoon Hungama offer of exchanging any old feature phone for a JioPhone for about `1,000 (including six months recharge) also proved a runaway hit with users of plain vanilla phones who upgraded to 4G and contributed to the sharp upsurge in the Mukesh Ambani-owned telco’s subscriber base in the September quarter.Airtel’s refusal to fight Jio in the VoLTE feature phone space has come at a heavy price. The telco lost as many as 6.6 million subscribers in the September quarter, while Jio reported a 37 million customer additions during the same taking its total base to over 252 million. Current market leader, Vodafone Idea, which has also refused to counter Jio in the 4G feature phone segment, similarly also lost 13 million customers in the fiscal second quarter, stung by a mix of brutal price wars and rising costs.Small wonder, Bernstein estimates Jio to reach 28% RMS and 26% subscriber share by March next year, especially if Airtel and VIL don’t counter Jio’s call to subsidise its 4G feature phone.“Both Bharti and Vodafone managements have indicated they don’t believe in handset subsidies for prepaid users; so if left unchallenged, Jio could reach the leading revenue market share position by 2021 and by subscribers by 2022,” the global brokerage said.Analysts also expect Airtel and VIL’s decision to unveil minimum recharge plans amid ongoing customer losses to Jio, will see both telcos collectively losing 56 million customers by the fourth quarter of FY19. | mukesh ambani-led telco will continue to subsidise its popular 4G VoLTE feature phone, called JioPhone, till these twin goals are realised. the two older carriers will look forward to a time when Jio would start monetising its (customer) base through higher pricing. big incumbent carriers were hurt, while fringe players that couldn’t withstand the brutal price war exited. | Negative |
https://www.businesstoday.in/sectors/energy/decline-in-global-gas-prices-credit-positive-for-indian-consumers-icra/story/408523.html | The plunge in global gas prices is credit positive for the domestic consumers in the medium-term because it will compel industrial and commercial consumers to convert from alternate fuels, ICRA said in its latest report.
Asian spot prices of liquefied natural gas (LNG) have declined to about $2 per million British thermal units (MMBtu) due to increase in supplies coupled with slow demand in wake of the COVID-19 pandemic. Nearly 29 million tons of liquefaction capacity was added in calendar year (CY) 2019 over 37 million tons added in CY2018.
"Even though LNG trade grew by the highest ever at 40 million tons in CY2019, the demand was outpaced by supply, depressing spot prices. Going forward, another 163 million tonnes of LNG capacity is expected to be added over 2020 to 2025 leading to supply outstripping demand which would continue to weigh on prices," ICRA said.
The report added that the COVID-19 pandemic is expected to drag the world GDP into 3 per cent contraction. "The timing of the recovery in the global economy is uncertain and expected to be prolonged, due to which the demand growth of natural gas is expected to remain muted over the medium term, owing to which prices are expected to remain under pressure," it said.
Besides, crude oil prices have also declined precipitously due to slump in demand on account of coronavirus outbreak which would also pressurise LNG prices, it added.
Also Read: No change in fuel prices on Tuesday; petrol at Rs 80.43, diesel Rs 80.53 in Delhi
"Owing to the unprecedented supply additions, high inventories and demand destruction due to the COVID-19 pandemic, LNG prices have declined to all time low levels. Mirroring the trend in LNG prices, gas prices at various international hubs have also declined to multi-year lows. Henry Hub prices currently at around $1.5/mmbtu, reflect the excess supply despite the recent production cuts amid unprecedented demand destruction due to Covid pandemic and high inventories," said K. Ravichandran, Senior Vice-President and Group Head, Corporate Ratings, ICRA.
"While record low prices are unlikely to sustain beyond the shock of the coronavirus, the surplus of LNG supply means prices will remain subdued. From an LNG aggregators perspective low spot prices could compress marketing margins on contracted long-term LNG as consumers would pressurise for reducing delivered prices," he added.
According to ICRA, low spot LNG prices are positive from a consumer perspective, however, due to the current low demand across different sectors, most production facilities are operating at moderate capacity utilisations and accordingly consumers which have long-term LNG procurement contracts are unable to exhaust the current contracted quantities of gas and take advantage of spot gas.
With ease in lockdown restrictions and recovery in demand, consumers would be in a position to benefit from low spot prices, it said.
Also Read: India-China tension: India to inspect power equipment for malware, Trojan horses
In case of ultra low spot prices, a key beneficiary would be domestic city gas distribution (CGD) companies who are expected to roll out networks in a large number of geographical areas (GAs) and low spot gas prices could provide compelling economics to convert industrial and commercial consumers from alternate fuels, ICRA said.
Moreover, standalone LNG dispensing stations, on which greater regulatory clarity was received recently, could also benefit from demand fillip, it added.
Additionally, in an effort towards enabling gas market and fostering gas trading in the country, the Indian government launched a natural gas trading platform - Indian Gas Exchange (IGX) on June 15, 2020. To begin with, trading has started at the physical hubs at Hazira and Dahej in Gujarat and Kakinada in Andhra Pradesh. The exchange provides six market products such as daily, weekly, fortnightly etc. The contracts traded at IGX are for compulsory physical delivery and are non-transferable.
"While a gas trading exchange would provide efficient and competitive discovery of gas prices, there are several impediments to overcome such as low domestic production vis-a-vis demand, bulk of domestic gas governed by the modified Rangarajan formula, lack of pan India trunk pipeline infrastructure, distance bases transportation tariff regime, different taxation rates across states etc," it said.
By Chitranjan Kumar | ICRA says the fall in global gas prices is credit positive for domestic consumers. spot prices of liquefied natural gas (LNG) have declined to about $2 per million British thermal units. the report added that the COVID-19 pandemic is expected to drag the world GDP into 3% contraction. the report also said that crude oil prices have also declined precipitously due to slump in demand. | Negative |
https://www.moneycontrol.com/news/world/us-expected-to-report-slowest-job-growth-in-six-months-6188611.html | U.S. employers likely hired the fewest workers in six months in November, hindered by a resurgence in new COVID-19 cases that, together with a lack of more government relief money, threatens to reverse the recovery from the pandemic recession.
The Labor Department's closely watched employment report on Friday will only cover the first two weeks of November, when the current wave of coronavirus infections started. Infections, hospitalizations and death rates have sky-rocketed, leading some economists to anticipate a drop in employment in December or January as more jurisdictions impose restrictions on businesses and consumers shun crowded places like restaurants.
"The November employment report may be the last 'strong' employment report for a while until a vaccine is widely available," said Sam Bullard, a senior economist at Wells Fargo Securities in Charlotte, North Carolina. "The labor market is showing increased signs of stress, which could manifest itself into smaller monthly hiring gains over the winter months."
Nonfarm payrolls likely increased by 469,000 jobs last month after rising by 638,000 in October, according to a Reuters survey of economists. That would be the smallest gain since the jobs recovery started in May and a fifth straight monthly deceleration in job gains, leaving employment 9.621 million jobs below its February peak.
It would be in line with reports on consumer spending, manufacturing and services industries that have suggested a slowdown in the recovery from the worst recession since the Great Depression. Hiring peaked 4.781 million in June.
The United States is in the midst of a fresh wave of COVID-19 infections. Nearly 200,000 new cases were reported on Wednesday and hospitalizations approached a record 100,000 patients, according to a Reuters tally of official data.
Republicans in Congress struck a more upbeat tone on Thursday during coronavirus aid talks as they pushed for a slim $500 billion measure that previously was rejected by Democrats who say more money is needed.
More than $3 trillion in government COVID-19 relief helped millions of unemployed Americans cover daily expenses and companies keep workers on payrolls, leading to record economic growth in the third quarter. The uncontrolled pandemic and lack of additional fiscal stimulus could result in the economy contracting in the first quarter of 2021.
"We are going to see another dip in employment sometime this winter and followed by a decline in GDP in the first quarter," said Sung Won Sohn, a finance and economics professor at Loyola Marymount University in Los Angeles. "Unlike the first wave, there is no massive government stimulus on the horizon to cushion the economy. Interest rates are already zero."
DOWNSIDE BIAS
Job growth last month was likely held back by further departures of temporary workers hired for the 2020 Census. States and local governments are also expected to have shed more workers, leaving overall government payrolls to decline for a second straight month.
Retailers typically embark on seasonal hiring in November, a practice that has been upended by the pandemic. Economists expect this disruption could throw off the model that the government uses to strip seasonal fluctuations from the data.
Payrolls could surprise on the downside. The Institute for Supply Management reported this week its measure of factory employment contracted in November. The Federal Reserve's "Beige Book" report showed employment rising in all districts on or before Nov. 20, but the U.S. central bank noted "for most, the pace was slow, at best."
The unemployment rate is forecast dipping to 6.8% from 6.9% in October. It, however, has been biased down by people misclassifying themselves as being "employed but absent from work." That will keep the focus on long-term unemployment and people working part-time for economic reasons.
Economists will also keep an eye on the share of women in the labor force. Industries that tend to employ women have been hard hit by the recession. Many women have also quit jobs to look after children as schools have moved to online learning.
The number of people out of work for more than six months surged by 1.2 million in October. There were 6.7 million part-time workers. The share of those permanently unemployed increased to 40.9% in October from 35.6% in the prior month.
"Long-term unemployment always rises in a downturn, but the increase in the share of long-term unemployed has been extraordinarily rapid in the pandemic recession," said Dean Baker, senior economist at the Center for Economic and Policy Research in Washington. "This matters because people who have been unemployed for more than six months generally have a harder time being reemployed."
Labor market slack is expected to have left wages barely rising in November. Average hourly earnings are forecast nudging up 0.1%, matching October's gain. The average workweek is seen steady at 34.8 hours. Slower job and wage growth would lead to weakness in a proxy for take-home pay.
"The slowing in income along with the lack of another fiscal stimulus package will constrain household income and spending going forward," said Kathy Bostjancic, chief U.S. financial economist at Oxford Economics in New York. | nonfarm payrolls likely increased by 469,000 jobs last month. that would be the smallest gain since the jobs recovery started in may. the united states is in the midst of a fresh wave of COVID-19 infections. a lack of more government relief money could result in the economy contracting. a spokesman for the labor department says the report is "very optimistic" | Negative |
https://www.moneycontrol.com/news/business/markets/how-to-make-the-most-of-muhurat-trading-4577391.html | Rahul Jain
The Indian economy, despite all its inherent potential, is going through one of its leanest patches recently. Renowned global agencies like the International Monetary Fund (IMF) and the Asian Development Bank (ADB) have slashed the country’s growth forecast in their publications. Today, the signs of an economic slowdown are all the more evident.
With the economic slowdown taking the center-stage, resulting in most investments turning red, investors are looking at ways to reverse fortunes and be optimistic.
Interestingly, our rituals, too, are all about keeping negativities at bay, being positive and Muhurat trading is just the beginning.
Positive sentiment on the horizon:
Muhurat trading is an auspicious slot on the day ‘Lakshmi Pujan’ on Diwali when markets open for an hour in the evening. Trading done during that particular period is believed to bring good luck, wealth and prosperity.
For individual and institutional investors, Muhurat trading presents an opportunity to carry out some trading as a token of auspicious buying. More than a means for booking profit, transactions are carried out with the hope of a profitable year ahead.
This year, BSE and NSE will conduct Muhurat trading on October 27 from 18:15 hrs to 19:15 hrs.
How to make the most of Muhurat trading?
As Muhurat trading is the mark of a new beginning, it’s the right time to take stock of your asset allocation and find out if it’s performing as per your liking, most importantly according to your financial goals. Note that with trading restricted to only an hour, Muhurat trading limits liquidity.
With little space to book profit, it is advisable to avoid day trading strategy during this special trading session. New investors looking to get started can make token investments to mark the auspicious occasion.
While doing so, don’t get swayed by the festive sentiments. Invest a small amount, ideally in large-cap scrips. If you are in a dilemma, you can take help from a certified financial planner.
To sum up:
Amid the domestic slowdown, international developments like political tension in the Middle East and the raging trade war between global powers are further expected to put pressure on the Indian economy.
As a response to the ongoing crisis, the concerned authorities have come up with several initiatives like concession in corporate tax, cut in the repo rate and linking of lending rate to external benchmarks for the efficient transfer of benefits of such cuts to the borrowers.
A boost in domestic investment holds the key to the revival of the spirits in the Indian financial markets. Also, paying homage to the goddess of wealth, Lakshmi, there can’t be a better occasion than Muhurat Trading to get started.
India, with its highly developed regulatory infrastructure and policy machinery, has gone a long way to set up a competitive business environment. Tiding over the current economic slowdown calls for financial consolidation, of which Muhurat trading can be the perfect beginning.
In a fluid market scenario, a long- term investment strategy can help you leverage the power of compounding and benefit from the inflation-beating returns of equities.
Happy trading!
(The author is Head, Personal Wealth Advisory, Edelweiss)
Disclaimer: The views and investment tips expressed by investment experts on Moneycontrol.com are his own and not that of the website or its management. Moneycontrol.com advises users to check with certified experts before taking any investment decisions. | the economic slowdown is taking the center-stage, resulting in most investments turning red. Muhurat trading is an auspicious slot on the day ‘Lakshmi Pujan’ on Diwali when markets open for an hour in the evening. trading done during that particular period is believed to bring good luck, wealth and prosperity. this year, BSE and NSE will conduct Muhurat trading on October 27 from 18:15 hrs to 19:15 hrs. | Negative |
https://www.financialexpress.com/brandwagon/coronavirus-impact-how-broadcasters-are-dealing-with-content-shortfall/1918376/ | The television broadcast industry is taking a few creative liberties to deal with the lack of fresh content in the wake of the coronavirus outbreak. While some broadcasters are developing theme-based edits of existing content, and bringing back iconic shows, others are resorting to reruns of popular shows, and testing the viability of using video conferencing tools to create content.
The Indian film and television industry had decided to halt shoots as a preventive measure until March 31. But the 21-day national lockdown has imposed a longer moratorium on the industry. With a content repository that could last only four weeks, most broadcasters had run out of fresh content by March end.
Riding on nostalgia
Bringing back old shows seems to be broadcasters’ best bet. Public broadcaster Doordarshan led the trend by bringing back iconic shows such as Ramayan, Circus, Byomkesh Bakshi and Shaktiman, among others. Viacom18 is airing reruns of its marquee non-fiction show Bigg Boss (Season 13) at 10 pm every day on Colors.
Zee TV is replacing its prime time shows Kumkum Bhagya and Kundali Bhagya with a few finite web series namely, Karrle Tu Bhi Mohabbat, Baarish, Kehne Ko Humsafar Hain, which were first streamed on ALTBalaji.
Prathyusha Agarwal, chief consumer officer, Zee Entertainment Enterprises, says, “We will also be creating fresh edits of existing shows. For instance, for &TV, we are developing edit-based, long episodes of shows such as Ek Mahanayak – Dr BR Ambedkar and Happu Ki Ultan Paltan.” The broadcaster is expected to tap into the originals library of its OTT platform, Zee5.
Additionally, broadcasters have turned some of their channels into free-to-air for a period of two months on all DTH and cable networks. Sony Pal, Star Utsav, Zee Anmol and Colors Rishtey are among the channels that are now available for free.
‘Home’ productions
The lockdown has led to a significant increase in television viewership, but most of the viewing is concentrated on news, movies and kids channels. The average time spent on GECs dropped by 5% in the week of March 14-21, as per the Broadcast Audience Research Council India, while news and kids channels have seen an increase of 17% and 11%, respectively, in average time spent.
In the US, where talk shows are immensely popular, broadcasters have begun creating broadcast-level content from the homes of the show hosts.
“While we are exploring all kinds of best practices from our counterparts in other markets, replicating the broadcast-from-home model will be tough in a scripted content heavy market like India,” says Deepak Dhar, founder and CEO, Banijay Asia.
Indian programming is dominated by scripted serials and non-fiction reality TV shows — both of which need a large set-up, crew and equipment.
Content creators in India are getting creative though. Cricketer Kevin Pietersen has been hosting interviews via Instagram Live with celebrities such as Indian batsman Rohit Sharma and member of Parliament Shashi Tharoor, while film reviewer Anupama Chopra is using Zoom video conferencing to interview Bollywood celebrities for YouTube channel Film Companion.
These formats are inspiring Indian television producers. Industry watchers say that sports channels are exploring options to replicate interviews via video conferencing and remote content creation formats.
Dhar says that while production has come to a grinding halt, teams are working on developing shows during this time. “This situation has shown us that we need to start evolving in the way we produce our content,” he says.
Ashish Pherwani, partner, media and entertainment leader, EY India, expects movies made on small budgets or movie producers struggling with cash flows to turn to early premieres on television. These too could help broadcasters who are content hungry right now.
Read Also: Ramayan returns with a bang; garners 170 million viewers over a weekend: BARC
Follow us on Twitter, Instagram, LinkedIn, Facebook | television broadcasters are taking creative liberties to deal with the lack of fresh content in the wake of the coronavirus outbreak. some are developing theme-based edits of existing content, while others are resorting to reruns of popular shows. the 21-day national lockdown has imposed a longer moratorium on the industry. most broadcasters had run out of fresh content by march end. | Negative |
https://www.moneycontrol.com/news/trends/coronavirus-pandemic-need-smart-upgrade-one-size-fits-all-lockdown-has-brought-untold-misery-rahul-gandhi-5143641.html | Hours before Prime Minister Narendra Modi announced the extension of the nationwide lockdown till May 3 to curb the spread of the novel coronavirus, Congress leader Rahul Gandhi had taken to Twitter to dub it as the “one-size-fits-all” lockdown.
For live updates on coronavirus, click here
Seeking a “smart upgrade” to the current situation in the country, he had urged the Centre to craft a solution that would help resuscitate the dying businesses at least in areas that are less affected by the novel coronavirus.
The one-size-fit-all lockdown has brought untold misery & suffering to millions of farmers, migrant labourers, daily wagers & business owners. It needs a “smart” upgrade, using mass testing to isolate virus hotspots & allowing businesses in other areas to gradually reopen. — Rahul Gandhi (@RahulGandhi) April 13, 2020
COVID-19 Vaccine Frequently Asked Questions View more How does a vaccine work? A vaccine works by mimicking a natural infection. A vaccine not only induces immune response to protect people from any future COVID-19 infection, but also helps quickly build herd immunity to put an end to the pandemic. Herd immunity occurs when a sufficient percentage of a population becomes immune to a disease, making the spread of disease from person to person unlikely. The good news is that SARS-CoV-2 virus has been fairly stable, which increases the viability of a vaccine. How many types of vaccines are there? There are broadly four types of vaccine — one, a vaccine based on the whole virus (this could be either inactivated, or an attenuated [weakened] virus vaccine); two, a non-replicating viral vector vaccine that uses a benign virus as vector that carries the antigen of SARS-CoV; three, nucleic-acid vaccines that have genetic material like DNA and RNA of antigens like spike protein given to a person, helping human cells decode genetic material and produce the vaccine; and four, protein subunit vaccine wherein the recombinant proteins of SARS-COV-2 along with an adjuvant (booster) is given as a vaccine. What does it take to develop a vaccine of this kind? Vaccine development is a long, complex process. Unlike drugs that are given to people with a diseased, vaccines are given to healthy people and also vulnerable sections such as children, pregnant women and the elderly. So rigorous tests are compulsory. History says that the fastest time it took to develop a vaccine is five years, but it usually takes double or sometimes triple that time. View more Show
However, in his national address at 10 am on April 14 – the day the first lockdown was supposed to end – the Prime Minister only announced the extension of the lockdown, without much discussion on ways to restart economic activity, at least partially, in phases.
Coronavirus impact | Lockdown to hit state govt's finances worse than Centre
He, however, has been stressing on “jaan bhi, jahaan bhi” -- focusing on both life and livelihood -- as the mantra of the second lockdown against the “jaan hai toh jahan hai” – focusing only on saving lives -- mantra of the previous one.
The Prime Minister has promised to review the situation of the country five days from now on April 20 and basic economic activity may be allowed in certain pockets that prove to be safe from coronavirus infection, albeit with restrictions in place to ensure safety.
Coronavirus pandemic | Top-10 places most responsible for spreading COVID-19 in India
The lockdown has financially crippled the unorganized sector of the Indian economy, including migrant workers and daily wage earners. While stimulus packages have been announced by the Centre to help the poor sustain themselves during the lockdown, their lives can only limp back to normalcy once work resumes in these sectors.
To follow our full coverage on coronavirus, click here | the one-size-fits-all lockdown has brought untold misery & suffering to millions of farmers. a vaccine works by mimicking a natural infection. a vaccine also helps quickly build herd immunity to put an end to the pandemic. a vaccine works by mimicking a natural infection. a vaccine works by mimicking a natural infection. | Negative |
http://www.financialexpress.com/market/shares-of-pnb-icici-bank-axis-bank-ultratech-cement-rpg-life-sciences-rcom-indian-hotels-in-focus-today-7-march-2018-bse-nse/1089852/ | Indian stock markets are likely to open lower on Wednesday, 7 March 2018 following the declines in the US stock futures in the late session as the top economic advisor to President Donald Trump, Gary Cohen resigned from the post. The early indicator of NSE Nifty, SGX Nifty Futures was trading little changed, down 0.12% at 10,220 on Singapore Exchange on Wednesday. Shares of the fraud-hit Punjab National Bank, ICICI Bank and Axis Bank will be in a close watch today as the top officials have been issued the summons in regard to Rs 12,700 crore scandal at India’s second-largest PSU bank PNB.
These stocks will be in focus today
PNB: The anti-fraud agency, SFIO has summoned PNB managing director and CEO Sunil Mehta to record his statement in connection with the Rs 12,700-crore fraud at the bank, and he is expected to appear today, PTI reported citing unidentified officials.
ICICI Bank & Axis Bank: Senior officials from private sector lenders ICICI Bank and Axis Bank had appeared before the SFIO (Serious Fraud Investigation Office) after the anti-fraud agency summoned ICICI Bank’s MD & CEO Chanda Kochhar and Axis Bank’s MD & CEO Shikha Sharma with regard to investigations into the Rs 12,700 crore PNB scam. Further, Axis Bank has revealed that it has Rs 200-crore exposure to companies promoted by Nirav Modi and Mehul Choksi.
UltraTech Cement: The RBI has increased the limit of foreign portfolio investment (FPI) in UltraTech Cement to 40%.
RPG Life Sciences: Pharmaceutical firm RPG Life Sciences promoter Summit Securities sold nearly 11% stake in the company for Rs 79.18 crore, in an open market transaction.
Indian Hotels Company: Indian Hotels Company Ltd (IHCL) said Tata Sons will be acquiring up to 6.64% shares of the company from three promoter entities as part of restructuring the investment portfolio.
Reliance Communications: An arbitration tribunal in an interim order has restrained debt-ridden Reliance Communications from sale, transfer or mortgaging of assets.
The Indian rupee on Tuesday: The rupee jumped to a fresh one-week high gaining 16 paise to end at 64.96 against the US dollars.
Indian stock markets on Tuesday
Indian stock markets ended in negative territory for the fifth straight session on Tuesday with Sensex plunging 429 points and Nifty slipping below 10,250-mark as shares of heavyweight stocks such as ICICI Bank, Reliance Industries, HDFC Bank, ITC, TCS, SBI tumbled while PSU banks shares crashed heavily today. The S&P BSE Sensex lost 429.58 points or 1.27% to conclude at 33,317.2 whereas NSE Nifty settled below 10,300, at 10,221.2, down by 137.65 points or 1.33%. Shares of the blue-chip private sector lender ICICI Bank dragged the key equity indices heavily after the anti-fraud agency, SFIO summoned MD & CEO of ICICI Bank in the PNB fraud case.
US stock markets on Tuesday
US stock futures fell more than 1% late Tuesday after the resignation of US President Donald Trump’s top economic adviser, Gary Cohn, fueled fears that the administration would follow through with plans to impose steel and aluminium tariffs, possibly triggering a trade war, Reuters said in a report. White House officials said the dispute over tariffs contributed to Cohn’s decision to resign but was not the only reason, Reuters reported. The Dow Jones Industrial Average rose 9.36 points, or 0.04% to close at 24,884.12, the S&P 500 gained 7.18 points or 0.26% to 2,728.12 and the Nasdaq Composite added 41.30 points or 0.56% to 7,372.01. | early indicator of NSE Nifty, SGX Nifty Futures was trading little changed, down 0.12% at 10,220 on Singapore Exchange on Wednesday. ICICI Bank and Axis Bank have been summoned in regard to the Rs 12,700 crore fraud at the bank. meanwhile, axis bank has revealed that it has Rs 200-crore exposure to companies promoted by Nirav Modi and mehul Choksi. | Negative |
https://www.financialexpress.com/economy/q4-gdp-growth-estimate-no-consensus-among-economists-forecasters-govt-to-release-data-tomorrow/1973556/ | Eyes are glued on the Q4 economic growth data, as it includes the figures for one week of lockdown, which has the potential to drag the overall growth figure down.The government is set to release GDP growth figures for the fiscal fourth quarter Jan-Mar tomorrow; however, economists’ and rating agencies’ forecasts show no consensus and vary over a very wide range. Eyes are glued on the Q4 economic growth data, as it includes the figures for one week of lockdown, which has the potential to drag the overall growth figure down. While ICRA estimates the Q4 GDP growth at 1.9 per cent, CRISIL estimates it at 0.5 per cent. SBI research has pegged the Q4 FY2019-20 GDP growth rate at 1.2 per cent. In today’s report, Care Ratings has put the most optimistic Q4 GDP growth at 3.6 per cent. A Reuters poll of economists has forecast India’s fourth quarter GDP growth at 2.1 per cent.
One of the major reasons for diverse predictions could be the absence of reliable headline numbers, making the predictions less precise. The difference in the predictions is so large that six out the 52 economists in the Reuters poll have also predicted a contraction in GDP in Q4. However, the GDP growth in full-year FY20 is unanimously believed to be in the range of 4 – 4.3 per cent. The impact of the Covid-19 outbreak on travel, tourism and hospitality, government expenditure compression amidst revenue shortfalls in March 2020, and subdued credit growth are expected to have adversely impacted service sector performance in Q4 FY2020, said Aditi Nayar, Principal Economist, ICRA.
Also Read: Cash still king, demonetisation effect gone; digital payments rising but face 2 key roadblocks
Generally, business and economic activity shoots up in the last quarter as companies put more effort to meet their annual targets. However, the nationwide lockdown called by Prime Minister Narendra Modi in the last week of March had put a major roadblock before the economy. The coronavirus pandemic is not the only trouble behind the country’s growth, instead, it is superimposed on the previous trouble of a longer-than-anticipated slowdown in the country. These two reasons clubbed together are responsible for the pessimistic growth predictions in the last quarter.
Meanwhile, the growth figures for the fourth quarter will also help in giving some clarity in establishing a base for the predictions of the first quarter when economic activity had almost come to a standstill in April and showed very limited momentum in May. Recently, RBI Governor Shaktikanta Das said that the Indian economy will contract in the current fiscal. | the government is set to release GDP growth figures for the fiscal fourth quarter Jan-Mar tomorrow. while ICRA estimates the Q4 GDP growth at 1.9 per cent, CRISIL estimates it at 0.5 per cent. a Reuters poll of economists has forecast India’s fourth quarter GDP growth at 2.1 per cent. the impact of the coronavirus pandemic is not the only trouble behind the country’s growth. | Negative |
https://www.moneycontrol.com/news/india/covid-19-to-test-several-established-legal-precedents-in-the-months-ahead-5225311.html | By Jayant Bhatt
For the past few months, we have been staring into the face of a grave danger, to the economy, society, as well as to the human race. What repercussions will ensue, none can fathom. None of us has witnessed a situation like the present one, where flights are grounded, ships remain docked at ports, cars silently parked at the houses, factories are mandatorily closed, and people, who have the good luck and luxury to afford it, remain locked in their own homes without protest.
Business as we know it, is not being conducted. While many employees in the services sector have the luxury of working from home, businesses based on manufacturing or requiring hands-on labour are suffering huge losses. While the efforts of our elected government in protecting the country from the deadly effects of the pandemic are laudatory, the resultant effects on our economy cannot be ignored.
The daily barrage of notifications coming everyday being issued by the government, either as a diktat or as an advisory, is making life tougher for these already struggling businesses.
While this unprecedented situation is beyond one's wildest imagination, the requirement by the state for all citizens to remain philanthropic i.e. neither lay off employees nor cut their salaries for an indefinite period of time appears to be impractical and misguided. Simply put, when one is prevented from operating their business indefinitely and earning profits, how can the state expect them to be philanthropic?
COVID-19 Vaccine Frequently Asked Questions View more How does a vaccine work? A vaccine works by mimicking a natural infection. A vaccine not only induces immune response to protect people from any future COVID-19 infection, but also helps quickly build herd immunity to put an end to the pandemic. Herd immunity occurs when a sufficient percentage of a population becomes immune to a disease, making the spread of disease from person to person unlikely. The good news is that SARS-CoV-2 virus has been fairly stable, which increases the viability of a vaccine. How many types of vaccines are there? There are broadly four types of vaccine — one, a vaccine based on the whole virus (this could be either inactivated, or an attenuated [weakened] virus vaccine); two, a non-replicating viral vector vaccine that uses a benign virus as vector that carries the antigen of SARS-CoV; three, nucleic-acid vaccines that have genetic material like DNA and RNA of antigens like spike protein given to a person, helping human cells decode genetic material and produce the vaccine; and four, protein subunit vaccine wherein the recombinant proteins of SARS-COV-2 along with an adjuvant (booster) is given as a vaccine. What does it take to develop a vaccine of this kind? Vaccine development is a long, complex process. Unlike drugs that are given to people with a diseased, vaccines are given to healthy people and also vulnerable sections such as children, pregnant women and the elderly. So rigorous tests are compulsory. History says that the fastest time it took to develop a vaccine is five years, but it usually takes double or sometimes triple that time. View more Show
According to the latest press release dated May 1, 2020, the lockdown in our country has been extended for a further period of two weeks. The press release, once again, in predictable fashion, creates more ambiguity than clarity on facing the present situation.
It is noteworthy that while there is certain relaxation for e-commerce companies, activities in the demarcated Red Zone are permitted only to the extent of essential goods. One can imagine the problems arising from this declaration, when in many places, as in Delhi, the entire state has been declared a Red Zone. Further, the press release states that private offices can operate with upto 33 percent strength as per requirement, with remaining persons working from home.
I may be alone in this opinion, but the actual implementation of such clauses can only be imagined, not effectuated. Our well-intentioned though haphazard implementation of the lockdown begets the important legal question for businesses forced to sack its workers. What legal consequences will they face? The short answer is that our courts, which are overburdened, will face an explosion of resultant litigation by disgruntled employees and labor unions. Apart from unpaid employees, another major challenge facing businesses is their performance of contracts. Most contracts entered into nowadays contain standardised Force Majeure clauses, which may be rendered ineffectual in view of the present unimaginable situation. However, our judiciary is attempting to remain ahead of the problem.
As recently as last week, the High Court of Delhi in Halliburton Offshore Services Inc. v. Vedanta Ltd. & Anr., granted relief to the petitioner by allowing their claim of restriction on movement due to the present pandemic of COVID-19 to be in the nature of a Force Majeure event, and consequently, the respondent was restrained from invoking a bank guarantee against the petitioner.However, earlier this month, the Bombay High Court, on a strict reading of a Force Majeure clause contained in an agreement, disallowed a party from invoking the said clause in order to terminate a contract pertaining to the distribution of an essential commodity viz. steel, on grounds that the Force Majeure clause was applicable only to the Respondent, and further, that steel being an essential commodity, was not subject to the restriction imposed due to the nation-wide lockdown resulting from the pandemic.
Needless to state that although the aforementioned cases differ vastly in essence, the indefinite lockdown, that is undoubtedly required to stem the spread of COVID- 19, is dramatically increasing the liability of businesses.
Attributing the present situation of the novel coronavirus as an Act of God or a Force Majeure situation shall be dependent on the exact terms of a contract, and courts in general have been known to make strict interpretations of the same.
However, it is noteworthy that as of now, the Supreme Court has not been seized of such issues. If either of the aforementioned judgments were to be challenged before the apex court, it would undoubtedly provide a novel way of reading the same.In view of the numerous challenges faced by our citizenry, a question on the legality of such a lockdown too is constantly being raised. However, it is the judiciary which will finally decide if the actions of either the Legislature or the Executive were toeing the line or veering towards sheer arbitrariness.
(The author is a New Delhi-based independent litigator who practices in the Supreme Court. He holds dual Masters of Law (LL.M.) from New York University, USA and National University of Singapore and has over a decade of experience in commercial law)
Follow our full coverage of the coronavirus outbreak here | a pandemic like this is a grave danger to the economy, society and human race. a vaccine works by mimicking a natural infection. a vaccine works by mimicking a natural infection. a vaccine works by mimicking a natural infection. a vaccine works by building herd immunity to put an end to the pandemic. | Negative |
https://www.moneycontrol.com/news/business/markets/market-live-nifty-hovers-around-10250-midcaps-outshine-tata-motors-extends-gains-2541989.html | Moneycontrol News
3:30 pm Market Closing: Benchmark indices closed sharply lower after gains seen in previous two consecutive sessions, weighed by US-China trade war concerns.
The 30-share BSE Sensex was down 351.56 points or 1.05 percent at 33,019.07 and the 50-share NSE Nifty fell 116.60 points or 1.14 percent to 10,128.40.
About 1,427 shares declined against 1,183 advancing shares on the BSE.
Nifty Midcap was down 225 points.
Gammon Infra, PC Jeweller, Jaiprakash Associates, HCC, Sunil Hitech, SAIL, HDIL, DLF, Union Bank, South Indian Bank and Ashok Leyland fell up to 5 percent.
Kwality was up 10 percent while Nalco and Indiabulls Real gained 2-3 percent.
3:26 pm ICICI Securities Performance:
3:18 pm Godawari Power & Ispat inform exchanges that it has received approval of competent authority for private railway siding served by Mandhar Station of Raipur Division for inward traffic of coal, iron ore & manganese and outward traffic of pellet, which has become operational w.e.f. 31st March, 2018.
Earlier, the company used to transport its raw materials through the railway siding facility of Raipur Infrastructure Company (RICL), a joint venture company, at Mandhar, Raipur.
The lease period of the said railway siding of RICL has expired on March 31, 2018 and the same has not been renewed.
There will not be any interruption in the movement of the raw materials due to above developments, the company said.
3:10 pm Leading contributors to Nifty's fall: HDFC Bank, L&T, HDFC, IOC, Titan Company, Vedanta, Infosys, Bajaj Finserv, Kotak Mahindra Bank, Grasim, UPL, Yes Bank and SBI were down up to 4 percent.
2:58 pm HUDCO in focus: HUDCO has achieved the level of loan sanctions (provisional) of Rs 38,600 crore and loan releases (provisional) of Rs 16,500 crore as on March 31, 2018, for the financial year 2017-18.
2:45 pm Market Update: The market is trading near day's low, with the Sensex falling nearly 400 points after China has announced new tariffs on 106 US products, which include soybeans, cars and whisky.
The Nifty Bank index lost more than 400 points while the Nifty50 slipped more than 100 points as all sectoral indices are in the red barring Auto.
Nifty Midcap index is also down over a percent.
Dow Jones futures are down 2 pecent, indicating negative opening on Wall Street later today.
2:30 pm Licensing agreement: Glenmark Pharmaceuticals and Helsinn Group, a Swiss pharmaceutical group focused on building quality cancer care products, entered into an exclusive licensing agreement to introduce AKYNZEO in India and Nepal.
AKYNZEO, an oral fixed combination of netupitant 300mg and palonosetron 0.5mg in capsule form, is used for prevention of chemotherapy-induced nausea and vomiting (CINV).
Glenmark will have exclusive marketing rights for AKYNZEO in India and Nepal.
2:20 pm Order Win: CC has received four new orders totalling to Rs 1,085 crore in March 2018.
Out of this, one order of Rs 344 crore pertains to Water and Environment division and three oders totalling Rs 741 crore pertain to electrical division.
2:10 pm Corporate Affairs Secy on ICICI Bank-Videocon matter: It is well within the SIFO's ambit to make a reference about a case but there is no such reference currently with the corporate affairs ministry on the issue involving ICICI Bank and Videocon Group, a senior official said.
Against the backdrop of controversy over the alleged conflict of interest and quid pro quo involving ICICI Bank CEO Chanda Kochhar and her family members in extending a loan to Videocon Group, reports said the Serious Fraud Investigation Office (SFIO) has sought permission to look into the matter.
The probe agency comes under the Corporate Affairs Ministry.
On whether the matter is being looked at by the SFIO, Corporate Affairs Secretary Injeti Srinivas said there is no such reference in the ministry and added that the RBI is the regulator that is looking into it.
"If the SFIO considers it necessary to make a reference to the ministry, it is well within its ambit," he told reporters.
Here are the top headlines at 2 pm from Moneycontrol News' Anchal Pathak
2:00 pm Market Update: Benchmark indices extended losses, with the Sensex falling 333.36 points or 1 percent to 33,037.27 after China unveiled new retaliation plan for US tariffs.
The Nifty fell 111.80 points or 1.09 percent to 10,133.20.
The market breadth turned negative as about 1,394 shares declined against 1,078 advancing shares on the BSE.
1:51 pm Buzzing: Sharika Enterprises share price rallied 20 percent as it has received letter of intent for designing, supplying, installation and commissioning of solar street lighting systems worth Rs. 40.33 crore (approximately) from one of the State Government's renewable energy agency.
1:36 pm Europe Update: European markets were slightly lower, as elevated concerns of a tit-for-tat trade war between the world's biggest economies overshadowed a bounce on Wall Street.
The pan-European Stoxx 600 was down around 0.2 percent, with most sectors and major bourses in negative territory.
1:31 pm Market Update: Benchmark indices fell sharply in afternoon after China unveiled new retaliation plan for US tariffs.
The 30-share BSE Sensex was down 272.14 points at 33,098.49 and the 50-share NSE Nifty fell 86.30 points to 10,158.70.
1:20 pm China unveils retaliation plan for US tariffs: China has announced new tariffs on 106 US products, which include soybeans, cars and whisky.
The world's second largest economy has set net tariff rate of additional 25 percent on US products, which include soyabean, corn, auto, chemical products.
China will announce effective date for new US tariffs at a later time.
New tariffs on US products include corn, other agri products, some types of aircraft, some plastic products, cotton, orange juice, wheat, sorghum products, tobacco etc.
1:05 pm Fundraising: Indian companies raised Rs 4,975 crore by issuing non-convertible debentures (NCDs) to retail investors in 2017-18 to meet their business requirements, a plunge of 83 percent from the preceding year.
In 2016-17, firms had mobilised Rs 29,558 crore through this route, according to latest data with the Securities and Exchange Board of India (Sebi).
Overall, in terms of volume, there were seven NCD issues in the recently-concluded fiscal as against 16 in 2016-17.
The companies raised money for funding expansion plans, retiring debt, supporting working capital requirements and other general corporate purposes.
NCDs are loan-linked bonds that cannot be converted into stocks and usually offer higher interest rates than convertible debentures.
Here are the top headlines at 1 pm from Moneycontrol News' Sakshi Sharma
12:55 pm Buyback of shares: Akzo Nobel India scrip price rallied 10 percent intraday ahead of board meeting to consider share buyback.
"A meeting of the board of directors of the company scheduled to be held on April 06, 2018, to consider proposal to buyback its own shares," the paint company said in its filing.
Meanwhile, the company completed its divestment of specialty chemicals business to Akzo Nobel Chemicals India Private Limited on March 31, 2018.
12:45 pm Market Update: The market continued to be rangebound, with the Nifty hovering around 10,250 levels.
Investors are awaiting cues from the two-day monetary policy committee meeting which ends on Thursday and March quarter earnings.
Tata Motors retained top position in the buying list of Nifty50 stocks, rising nearly 6 percent after good JLR show in the US in March.
12:35 pm RBI Policy Expectations: The first bi-monthly monetary policy review for FY19 is to be announced by the RBI on April 5.
According to CARE Ratings, the RBI is likely to maintain an unchanged stance on policy rates.
"The important issue will be the tone of the policy- will it be hawkish or neutral. We would tend to think that there would be more than neutral indications with a tint of hawkishness. Also we expect all members of the MPC to vote for at least no change with a possibility of a vote for a rate hike also on cards. However, there would not be a vote for a rate cut most probably," it said.
The policy review is in the backdrop of higher economic growth, moderation in inflation, increase in bank credit growth, lower bank deposits growth, tight liquidity conditions and increasing GSec yields in FY18.
12:20 pm Appointment: Reliance Capital announced the appointment of Nitin Rao as its new Chief Executive Officer.
"Rao will report to Anmol Ambani, Executive Director at Reliance Capital, and will be responsible for driving a more broad-based strategy for growing the wealth management offering to high net worth individuals," the company said.
12:15 pm ICICI-Videocon Case: The Serious Fraud Investigation Office (SFIO) is awaiting a nod from the Ministry of Corporate Affairs (MCA) to probe the ICICI-Videocon case, wherein a loan of Rs 3,250 crore was extended by the bank to the Videocon Group in 2012. The agency wants to take up the investigation as “the quantum involved is several thousand crores” and it concerns “public money”.
The SFIO had sent a request to the ministry last week regarding the same.
The Mumbai office of the SFIO had received a letter from a whistleblower last month. The letter, sources said, talked of alleged “corporate malpractice, surreptitious transactions and round tripping of money”.
The SFIO made a preliminary report on the case and submitted it to the MCA. A source close to the development told Moneycontrol, "The ministry may take a call on the investigation within this week."
Another source told Moneycontrol, "In the preliminary report, there are many transactions which need to be investigated."
12:05 pm Technical Outlook: Ashish Chaturmohta of Sanctum Wealth Management said above 10,250 levels, the Nifty can rally towards 10,420-10,500 levels where next cluster of resistances are seen. On the downside index has immediate resistance at 10,095 levels, breaking below this next support is at 9,950-9,920 levels.
Here are the top headlines at 12 pm from Moneycontrol News' Anchal Pathak
11:56 am Market Update: The market is currently off the day's high in volatile trade. Investors are awaiting cues from the two-day monetary policy committee meeting which ends on Thursday and March quarter earnings.
The 30-share BSE Sensex was up 42.70 points at 33,413.33 and the 50-share NSE Nifty rose 3.40 points to 10,248.40.
About 1,626 shares advanced against 715 declining shares on the BSE.
11:40 am Infosys Earnings next week: Infosys will announce the results for its fourth quarter and year ended March 2018 on Friday, April 13 around 4.00 pm Indian Standard Time.
11:25 am Crude Update: Oil prices slipped on expectations for a build-up in US crude inventories, but Russian government comments on prospects for stepping up cooperation with OPEC to coordinate output cuts braked steeper declines.
US WTI crude futures were at USD 63.32 a barrel, down 0.30 percent, from their previous settlement.
Brent crude futures dipped to USD 67.90 per barrel, down 0.32 percent, after it rose 0.7 percent on Tuesday.
11:15 am Jet Airways in Focus: Shares of Jet Airways rose as much as 3 percent on the bourses after the company said it had entered a pact for buying 75 B737 planes.
In a regulatory filing yesterday Jet Airways said it had entered an agreement with Boeing for buying 75 B-737 Max aircraft, as it looks to strengthen presence in the fast growing domestic aviation market.
Following the announcement, shares of the company opened on a bullish note at Rs 623, then gained further ground to touch an intraday high of Rs 632.25, up 2.99 per cent over its previous closing price.
11:03 am Buzzing: Zensar Technologies share price gained more than 5 percent after receiving a four-year, multi-million dollar contract from the City of San Diego for network services.
The contract has option of extension of two additional two-year terms with the total not to exceed contract value being approximately USD 79 million.
10:50 am Order Win: NBCC has received sanction from Ministry of Home Affairs (MHA), Government of India, for the construction of 14,460 bunkers in villages along the Indo-Pak Border in Jammu and Kashmir amounting Rs 415.73 crore.
NBCC is already executing border fencing work on Indo-Pak & Indo-Bangla borders for the MHA.
10:40 am Market Update: The market gained strength amid volatility, with the Nifty inching towards 10,300 levels and the Sensex gaining more than 100 points.
The broader markets extended gains, with the Nifty Midcap index rising 0.8 percent and BSE Smallcap gaining 1.2 percent.
The 30-share BSE Sensex was up 119.84 points at 33,490.47 and the 50-share NSE Nifty rose 30.30 points to 10,275.30.
About four shares advanced for every share falling on the BSE.
Tata Motors was the top gainer among Nifty50 stocks, up more than 5 percent after strong JLR show in the US in March
10:33 am RBI Approval: IndusInd Bank informed exchanges that the Reserve Bank of India has granted approval for the proposed company's acquisition of 100 percent stake in ISSL.
In March, the bank entered into an agreement with Infrastructure Leasing and Financial Services, the promoter shareholder of IL&FS Securities Services (ISSL) to acquire 100 percent of ISSL.
10:20 am Order Win: Building construction company Capacit'e Infraprojects has received contracts worth Rs 365.50 crore from Oberoi Realty Group entities. The stock gained 2 percent.
10:10 am Appointment: Den Networks said Himanshu Jindal has been appointed as chief financial officer of the company with immediate effect.
Rajesh Kaushall has resigned as chief financial officer and will continue to act as an advisor to the company, it added.
10:02 am Listing: Mishra Dhatu Nigam share price opened lower at Rs 87 on the National Stock Exchange, down 3.3 percent compared to the issue price of Rs 90.
The stock price fell as much as 4.4 percent in morning to hit a day's low of Rs 86.05 while it touched an intraday high of Rs 90.90.
The Rs 438-crore initial public offer of speciality alloy maker Mishra Dhatu Nigam (MIDHANI) was subscribed 1.21 times during March 21-23, 2018.
Here are the top headlines at 10 am from Moneycontrol News' Anchal Pathak
10:00 am Listing: ICICI Securities started off the first day on a negative note due to tepid response to the issue and analysts' doubts over consistency in financial performance going ahead.
The stock price debuted at Rs 453.80 on the National Stock Exchange, down 12.73 percent compared to issue price of Rs 520.
9:50 am Pre-Opening for ICICI Securities, Mishra Dhatu Nigam: ICICI Securities share price settled at Rs 435 in pre-opening trade on the NSE, down 16 percent from issue price of Rs 520.
State-owned steel company Mishra Dhatu Nigam share price settled at Rs 87 in pre-opening, down 3.3 percent from issue price of Rs 90.
9:45 am Monthly Sales Performance: JSW Steel has posted highest every monthly, quarterly and annual crude steel production.
"The monthly production of 1.52 million tonnes for March signifies a capacity utilisation of 101 percent. With this the company achieved 99 percent of production guidance of 16.5 million tonnes, given at the beginning of FY18," the company said.
9:35 am Market Update: Benchmark indices remained rangebound after opening mildly higher, with the Nifty hovering around 10,250 levels.
The 30-share BSE Sensex was up 17.29 points at 33,387.92 and the 50-share NSE Nifty fell 0.70 points to 10,244.30.
The broader markets outperformed frontliners, with the Nifty Midcap rising 0.4 percent and BSE Smallcap index up 0.75 percent on positive breadth.
About three shares advanced for every share falling on the BSE.
9:31 am Monsoon Forecast: Skymet Weather forecasts normal monsoon for India in 2018.
Skymet Weather said monsoon in India is likely to remain normal this year at 100 percent of its long period average of 887 mm. It sees a 20 percent chance of a below normal monsoon and zero probability of a drought.
9:21 am Buzzing: Tata Motors share price rallied more than 3 percent after Jaguar Land Rover's March US sales increased 10.2 percent to 14,232 units compared to 12,918 units sold in year-ago.
The growth was largely driven by Land Rover US sales that jumped 37.8 percent to 10,972 units, but Jaguar US sales fell 34.2 percent to 3,260 units YoY.
9:17 am Midcap Performer: Nifty Midcap gained 13 points.
Zensar Technologies, Akzo Nobel, IDBI Bank, Jet Airways, InterGlobe Aviation, Infibeam, Voltas, Pidilite Industries and VST Tillers gained up to 5 percent.
9:15 am Market Update: Benchmark indices opened mildly higher on Wednesday, with the Sensex rising 92.32 points to 33,462.95 and the Nifty gaining 11.80 points at 10,256.80.
9:08 am Technical Recommendations: We spoke to Guiness Securities and here’s what they have to recommend:
InterGlobe Aviation Ltd: Buy | Close: Rs 1367.85 | Target: Rs 1500 | Stop loss: Rs 1282 | Return: 9.65%
Jamna Auto Industries Ltd: Buy | Close: Rs 85.85 | Target: Rs 98 | Stop loss: Rs 78.50 | Return: 14.15%
Exide Industries Ltd: BUY | Close: Rs 232.95 | Target: Rs 260 | Stop loss: Rs 215 | Return: 11.59%
Disclaimer: The views and investment tips expressed by investment experts on Moneycontrol.com are their own and not that of the website or its management. Moneycontrol.com advises users to check with certified experts before taking any investment decisions.
9:06 am Rupee Update: The Indian rupee has opened higher by 3 paise at 64.98 against the US dollar on Wednesday.
It closed at 65.0125 to the dollar in previous session.
9:05 am Stocks in news: Bharat Forge and Ramkrishna Forgings in focus - North America Mach Class 8 truck sales up 102 percent at 46,900 units versus 23,215 units YoY: Agencies
Also Watch - Markets@Moneycontrol: Nifty to start on a flat note; 3 stocks which can give up to 14% return
Tata Motors: March auto sales
-JLR US sales up 10.2 percent at 14,232 units versus 12,918 units (YoY)
-Jaguar US sales down 34.2 percent at 3,260 units versus 4,953 units (YoY)
-Land Rover US sales up 37.8 percent at 10,972 units versus 7,965 units (YoY)
ICICI Securities: ICICI Securities make their debut on the bourses on Wednesday, it will be the first time in almost three years that a company whose public issue remained largely undersubscribed will list on the stock exchanges.
Mishra Dhatu: Shares of Mishra Dhatu Nigam (MIDHANI) will list on BSE and NSE on Wednesday. The initial public offer (IPO), which was oversubscribed by 1.21 times, was opened for subscription from March 21 to March 23. The company had fixed the price band of Rs 87-90 for the public offer.
Zensar Technologies: Technology firm Zensar said it has bagged a four-year deal from the City of San Diego for network services for a deal value of up to USD 79 million.
9:02 am Market Check: Benchmark indices were higher in pre-opening trade on Wednesday, continuing upside for third consecutive session.
The 30-share BSE Sensex was up 66.19 points at 33,436.82 and the 50-share NSE Nifty gained 46.80 points at 10,291.80.
Kwality rallied 10 percent. Voltas was up 2 percent and Zensar Technologies gained 3 percent. Infibeam was up 2.5 percent.
Videocon was down 5 percent.
The three major US stock indexes ended higher after a choppy session on Tuesday as investors looked forward to earnings season while the S&P 500 pushed above a key support level, Reuters reported.
The Dow Jones Industrial Average rose 389.17 points, or 1.65 percent, to 24,033.36, the S&P 500 gained 32.57 points, or 1.26 percent, to 2,614.45 and the Nasdaq Composite added 71.16 points, or 1.04 percent, to 6,941.28.
Asian markets were mixed in early Wednesday trade as Japanese stocks tracked gains seen on Wall Street overnight on a bounce in large cap technology names.
Japan's Nikkei 225 edged up by 0.42 percent and Topix crept higher by 0.16 percent. South Korea's benchmark Kospi index slipped 0.09 percent, weighed down by declines in the technology sector, CNBC reported. | 30-share BSE Sensex was down 351.56 points or 1.05 percent at 33,019.07. the 50-share NSE Nifty fell 116.60 points or 1.14 percent to 10,128.40. about 1,427 shares declined against 1,183 advancing shares on the BSE. ICICI has received approval for private railway siding served by Mandhar Station. | Negative |
https://www.moneycontrol.com/news/world/shelved-aramco-ipo-hits-at-heart-of-saudi-princes-reforms-2877821.html | Saudi Arabia's decision to shelve what was billed as the biggest share sale ever is a major blow to the credibility of Crown Prince Mohammed bin Salman but there are other ways to finance reforms to strengthen the economy, bankers and investors say.
The initial public offering (IPO) of 5 percent of state-owned oil giant Saudi Aramco was a centrepiece of the crown prince's plan to diversify the kingdom's economy beyond oil by raising $100 billion for investment in other sectors.
The 32 year old ruler, widely known as MbS, also promised that listing Saudi Aramco on international stock markets would help create a culture of openness in the secretive kingdom and make it more appealing to foreign investors.
The decision to shelve the IPO raises doubts about the management of the process as well as the broader reform agenda, sapping the momentum generated by Prince Mohammed's dramatic 2030 Vision announcement in 2016 that helped propel him to power in the world's top oil exporter.
"The problem is: the more it gets delayed and the more there's not clarity on why it's getting delayed and what the issues are, the more it undermines confidence," said James Dorsey, a senior fellow at Singapore's S. Rajaratnam School of International Studies (RSIS https://www.rsis.edu.sg).
"He's been very good at creating expectations but not as good at managing expectations," said Dorsey.
Industry sources told Reuters this week that both the international and domestic legs of the IPO had been postponed indefinitely. Energy Minister Khalid al-Falih said the government remained committed to conducting the IPO at an unspecified date in the future.
"The reform process has to be judged on its entirety and over a period of years but this will negatively affect perceptions of its credibility overall, considering that the IPO was promised in such high-profile terms," said Richard Segal, senior analyst at Manulife Asset Management in London.
VISION 2030
Prince Mohammed launched his Vision 2030 programme with promises to fundamentally transform Saudi Arabia's economy and open up its people's cloistered lifestyles. He has implemented a series of high-profile reforms, including ending a ban on women driving and opening cinemas in the conservative kingdom.
But those moves have been accompanied by a harsh crackdown on dissent, a purge of top royals and businessmen on corruption charges, and a costly war in Yemen now in its fourth year.
The crown prince's increasingly aggressive stance towards arch-rival Iran and in relations with supposed friends such as Canada and Germany has unnerved allies and investors alike.
"The Aramco IPO was supposed to be an example of a new global level of transparency. Perhaps because there's so much going on and so little explained, it looks like they've gotten worse at transparency," said a former senior Western diplomat.
But some bankers said the reform programme was far bigger than the Aramco IPO and, despite the possible political fallout, many changes could still go ahead, or even accelerate, now that senior officials are no longer preoccupied by listing Aramco.
"The reality is there is a lot of other stuff that the authorities could do before doing this huge move of the Aramco IPO," said a senior banker whose institution pitched to help arrange the sale.
FDI DRIVE
Riyadh's circumstances have improved greatly since plans for the IPO were first announced in 2016.
Oil was about $35 a barrel at the time and the government was desperate for cash. Oil prices have more than doubled since and the state budget deficit has narrowed sharply, so Riyadh has more room to find other ways to finance projects.
MSCI https://www.msci.com and FTSE Russell http://www.ftserussell.com decided this year to add Saudi Arabia to their emerging market equity indexes, so even without the IPO the kingdom can expect an inflow of $20 billion or more of foreign funds next year.
Meanwhile, the authorities are proceeding, slowly, with other reforms to attract foreign direct investment (FDI).
In July, Riyadh published draft rules for partnerships between the state and private firms to build infrastructure. Last week, the kingdom's water utility said it was talking to international companies about involving them in water distribution and treatment.
In addition to Aramco, authorities have said they aim to sell another $200 billion worth of state assets in the coming years. While many analysts say this looks ambitious, freezing the Aramco IPO may clear the way for smaller sales to go ahead.
"The IPO always had important symbolic value but would not have affected the rest of the Saudi economy very much," said Steffen Hertog, associate professor at the London School Economics and Political Science http://www.lse.ac.uk and a leading scholar on Saudi Arabia.
"Challenges like private job creation for Saudis and improving the legal and regulatory environment for local and foreign investors are more important for kingdom's long-term economic health," he said.
SABIC SALE
While Prince Mohammed put the value of a 5 percent stake in Saudi Aramco at about $100 billion, analysts reckon the IPO would have only raised some $50 billion to $75 billion as the prince's valuation was over-optimistic.
The money would have gone to the government's Public Investment Fund (PIF), largely to fund projects creating jobs. With unemployment among Saudi citizens officially at a record 12.9 percent, finding ways to boost employment is seen as vital.
But even without the IPO, those projects could still go ahead because Aramco said in July it may buy a strategic stake in petrochemicals maker Saudi Basic Industries (SABIC) from PIF - potentially giving the fund as much money as the IPO.
At market prices, the sale of the PIF's entire 70 percent stake in SABIC to Saudi Aramco would raise about $70 billion.
If the PIF can create jobs, suspending the Aramco sale may even prove politically positive for Prince Mohammed because some Saudis were uncomfortable with the IPO.
"The average citizen saw it as a misguided sell-off of the national patrimony. Many Saudi royals worried it would expose their source of wealth and privilege," said Jim Krane, fellow for energy studies at Rice University's Baker Institute.
"So there is probably some level of relief in Saudi Arabia that the state is backing away from the plan." | the initial public offering (IPO) of 5 percent of state-owned oil giant Saudi Aramco was billed as the biggest share sale ever. the decision to shelve the IPO raises doubts about the management of the process and the broader reform agenda. both the international and domestic legs of the IPO have been postponed indefinitely. | Negative |
https://www.businesstoday.in/markets/stocks/sensex-nifty-open-lower-auto-consumer-durables-lead-losses/story/314618.html | The Sensex and Nifty opened lower in trade today led by losses in auto and consumer durables stocks. While the Sensex fell 100 points to 35,555 with 16 components in the red, Nifty was down 20 points to 10,640. Sun Pharma (1.17%), Bajaj Finance (0.74%) and ICICI Bank (1.08%) were the top Sensex gainers.
Top Sensex losers were HUL (0.90%), PowerGrid (0.85%) and HDFC Bank (0.82%).
On Monday, the Sensex fell 368 pts to 35,656 and Nifty lost 119 points to 10,661.
Meanwhile, the mid cap and small cap indices were trading 18 points and 2 points higher in early trade. Market breadth was negative with 642 stocks trading higher compared to 691 falling on the BSE.
Consumer durables stocks and auto stocks led the losses with their indices falling 73 points and 75 points, respectively.
Global markets
Asian markets were lower on Tuesday after the U.S. Justice Department unsealed criminal charges against China's Huawei, its subsidiaries and a top executive ahead of trade talks.
Japan's Nikkei 225 index tumbled 1 percent to 20,448.47 and the Kospi in South Korea shed 0.4 percent to 2,169.42. Hong Kong's Hang Seng index was 0.8 percent lower at 27,370.58. The Shanghai Composite index fell 1 percent to 2,572.39. Australia's S&P ASX 200, reopening after a holiday, eased 0.6 percent to 5,870.80. Stocks fell in Taiwan and Singapore but rose in Indonesia.
Edited by Aseem Thapliyal | Sensex and Nifty opened lower in trade today led by losses in auto and consumer durables stocks. top Sensex gainers were sunpharma (1.17%), Bajaj Finance (0.74%) and ICICI Bank (1.08%) top Sensex losers were HUL (0.90%), PowerGrid (0.85%) and HDFC Bank (0.82%). | Negative |
https://www.financialexpress.com/opinion/economics-vs-covid-19-the-question-of-how-to-get-cash-to-the-intended-recipients-is-not-as-straightforward/1916638/ | With the coronavirus devastating one economy after another, the economics profession—and thus the analytical underpinnings for sound policymaking and crisis management—is having to play catch-up. Of particular concern now are the economics of viral contagion, of fear, and of “circuit breakers”. The more that economic thinking advances to meet changing realities, the better will be the analysis that informs the policy response.
That response is set to be both novel and inevitably costly. Governments and central banks are pursuing unprecedented measures to mitigate the global downturn, lest a now-certain global recession gives way to a depression (already an uncomfortably high risk). As they do, we will likely see a further erosion of the distinction between mainstream economics in advanced economies and in developing economies.
Such a change is sorely needed. With overwhelming evidence of massive declines in consumption and production across countries, analysts in advanced economies must reckon, first and foremost, with a phenomenon that was hitherto familiar only to fragile/failed states and communities devastated by natural disasters: an economic sudden stop, together with the cascade of devastation that can follow from it. They will then face other challenges that are more familiar to developing countries.
Consider the nature of the pandemic economy. Regardless of their desire to spend, consumers are unable to do so, because they have been urged or ordered to stay home. And regardless of their willingness to sell, stores cannot reach their customers, and many are cut off from their suppliers.
The immediate priority, of course, is the public-health response, which calls for social distancing, self-isolation, and other measures that are fundamentally inconsistent with how modern economies are wired. As a result, there has been a rapid contraction of economic activity (and therefore economic wellbeing).
As for the severity and duration of the coming recession, all will depend on the success of the health-policy response, particularly on efforts to identify and contain the spread of the virus, treat the ill, and enhance immunity. While waiting for progress on these three fronts, fear and uncertainty will deepen, with adverse implications for financial stability and prospects for economic recovery.
When thrust out of our comfort zones in such a sudden and violent fashion, most of us will succumb to some degree of paralysis, overreaction, or both. Our tendency to panic lends itself to still deeper economic disruptions. As liquidity constraints kick in, market participants rush to cash out, selling not just what is desirable to sell, but whatever can feasibly be sold.
When this happens, the predictable result is high risk of wholesale financial liquidation, which, in the absence of smart emergency policy interventions, will threaten the functioning of markets. In the case of the current crisis, the risk that the financial system will reverse-infect the real economy and cause a depression is too big to ignore.
That brings us to the third analytical priority: the economics of circuit breakers. Here, the question is not just what emergency policy interventions can achieve, but also what lies beyond their reach, and when.
To be sure, given that simultaneous economic and financial deleveraging would have disastrous implications for societal wellbeing, the current moment clearly demands a “whatever-it-takes”, “all-in”, and “whole-of-government” policy approach. The immediate priority is to establish circuit breakers that can limit the scope of dangerous economic and financial feedback loops. This effort is being led by central banks, but also involves fiscal authorities and others.
But there will be tricky tradeoffs to navigate. For example, there is significant momentum behind proposals for cash transfers and interest-free lending to protect vulnerable segments of the population, keep companies afloat, and safeguard strategic economic sectors. Rightly so. The idea is to minimize the risk that liquidity problems will become solvency problems. And yet, a cash- and loan-infusion program will face immediate implementation challenges. Aside from the unintended consequences and collateral damage that come with all blanket measures, flooding the entire system in today’s crisis would require the creation of new distribution channels. The question of how to get cash to the intended recipients is not as straightforward as it seems.
There are even more difficulties when it comes to implementing direct bailout programs, which have become increasingly likely. Far from being outliers, airlines, cruise lines, and other severely affected sectors are leading indicators of what is yet to come. From multinational industrial companies to family restaurants and other small businesses, the line for government bailouts will be very long.
Without clearly stated principles as to why, how, when, and under what terms government assistance will be offered, there is a high chance that the bailouts will be politicized, ill-designed, and co-opted by special interests. That would undermine the exit strategies for putting firms back on their own feet, and risk repeating the post-2008 experience, when the crisis was brought to heel but without laying the groundwork for strong, sustainable, and inclusive growth thereafter.
Given how extensive government interventions are likely to be this time around, it is critical that policymakers also recognize the limits of their interventions. No tax rebate, low-interest loan, or cheap mortgage refinancing will convince people to resume normal economic activity if they still fear for their own health. Besides, as long as the public-health emphasis is on social distancing as a means of quashing community transmission, governments won’t want people venturing out anyway.
All the issues raised above are ripe for more economic research. In pursuing these avenues of inquiry, many researchers in advanced economies will find themselves inevitably rubbing up against development economics—from crisis management and market failures to overcoming adjustment fatigue and putting in place better foundations for structurally sound, sustainable, and inclusive growth. Insofar as they adopt insights from both domains, economics will be better for it. Until recently, the profession has been far too resistant to eliminating artificial distinctions, let alone embracing a more multidisciplinary approach.
These self-imposed limits have persisted despite abundant evidence that, particularly since the early 2000s, advanced economies are saddled with structural and institutional impediments that have stifled growth in a manner quite familiar to developing economies. In the years since the GFC (2008), these problems have deepened political and societal divisions, undermined financial stability, and made it more difficult to confront the unprecedented crisis that is now knocking down our door.
The author is Chief economic adviser, Allianz. Project Syndicate | aaron carroll: economics is playing catch-up with coronavirus, which is ravaging economy. he says government and central banks are pursuing measures to mitigate global downturn. he says we need to be prepared for a sudden stop in consumption and devastation. carroll: we need to be prepared for a pandemic economy, a crisis that will be costly and disruptive. | Negative |
https://www.financialexpress.com/industry/warren-buffett-2020-agm-berkshire-hathaway-q1-2020-results-sold-stake-in-four-airlines-shut-retail-businesses-railroad-insurance/1946619/ | The March-quarter operating earnings for Warren Buffett’s Berkshire Hathaway, which reported a 6 per cent increase to $5.87 billion, “have little meaning for forecasting the next year,” Buffet said at the company’s annual shareholders meeting on Saturday. Hathaway reported $49.7 billion loss in the first quarter of 2020 amid Covid-19 outbreak. “I don’t know the consequences of shutting down the U.S. economy…For some period, certainly during the balance of the year but maybe much longer…our operating earnings will be considerably less than if the virus hadn’t come along,” said Buffet.
While the Berkshire Hathaway’s three biggest ventures including the BNFS railroad, insurance, and the energy business have been in a “reasonably decent” situation but its other businesses (such as the home furnishing store chain Nebraska Furniture Mart and chocolate and candy maker See’s Candies) have been “effectively shut down,” he said, to contain the virus spread.
Also read: Warren Buffett reveals why he hasn’t made any big investment despite sitting on $137 billion cash pile
As the company accelerated efforts against Covid in the second half of March and April, “most of our businesses were negatively affected, with the effects to date ranging from relatively minor to severe,” Hathaway said in its Q1 2020 earnings report. Its railroad, utilities and energy, insurance and certain of its manufacturing, distribution and service businesses “have slowed considerably in April.” Buffett told his shareholders that the company has sold around $6.5 billion of stock in April when it pared around 10 per cent stakes in the country’s four largest airlines – America, United, Delta and Southwest Airlines. The billion investor said he made an “understandable mistake” in valuing their stock noting that the airline sector has been “really hurt by a forced shutdown” due to the virus.
Berkshire Hathaway, which reported $137 billion cash in hand, hasn’t made any big investment deal since 2016 when it bought the industrial goods and metal fabrication company Precision Castparts for $37 billion. Buffett said that’s because he hasn’t come across a company “attractive” enough for the deal. “We have not done anything, because we don’t see anything that attractive to do.” However, the company is “willing to do something very big,” he said. | the company reported a 6% increase to $5.87 billion in the first quarter of 2020 amid the outbreak. "our operating earnings will be considerably less than if the virus hadn't come along," said Buffett. the company's three biggest ventures including the BNFS railroad, insurance, and the energy business have been in a "reasonably decent" situation. | Negative |
https://www.financialexpress.com/industry/free-messages-beyond-100-sms-a-day-jio-airtel-voda-idea-allowed-to-not-charge-money-even-after-limit/1985602/ | Indian telecom regulator TRAI has relieved companies of charging users with minimum 50 paisa for text messages after they cross the limit of 100 SMS a day owing to the situation arising out of the coronavirus pandemic. Under a certain clause, telecom companies were required to charge a minimum of 50 paisa per SMS above the limit of 100 SMS per SIM per day to avoid commercial bulk texts. “The deletion of Schedule XIII thus implies another step of TRAI in doing away with the tariff regulation and strengthening the regime of tariff regime forbearance,” TRAI said in its latest notification. However, after the removal of this clause, companies now have a free hand in deciding the charges for such bulk messages, PTI reported an official as saying.
“It was felt that tariff regulation which has the potential of adversely affecting the interests of genuine non-commercial bulk users of SMS is no longer required and therefore can be removed,” TRAI said. The Schedule XIII of the Telecommunications Tariff Order was introduced in 2012.
Meanwhile, Indian telecom operators are in for a pleasant surprise by FY25 as their revenues are likely to be doubled by the time period. India has entered into a “tariff discipline phase”, which means that companies such as Vodafone-Idea, Reliance Jio, and Bharti Airtel will enjoy higher ARPU (average revenue per user). “A comparative analysis of over 25 markets indicates that mobile revenues/ARPUs in India could double over FY20-25 to USD 38 billion,” a Jefferies report said on Monday. Currently, India’s mobile revenues-to-GDP ratio is among the lowest at 0.7% among the countries which share similar scale, according to a comparison of mobile ARPUs (average revenue per users) of over 25 countries.
With this, Sunil Bharti’s telecom company Bharti Airtel is likely to emerge as the key beneficiary of expanding tariffs and consolidation of the telecom space. The news may bring relief to Indian telecom operators which were having turbulent years since Mukesh Ambani’s entry into the telecom sector with Reliance Jio and the AGR dues. | telecom companies were required to charge a minimum of 50 paisa per SMS above the limit of 100 SMS per SIM per day. this was to avoid commercial bulk texts arising out of the coronavirus pandemic. after the removal of this clause, companies now have a free hand in deciding the charges for such bulk messages. the news may bring relief to Indian telecom operators which were having turbulent years since Mukesh Ambani’s entry into the telecom sector. | Negative |
https://www.moneycontrol.com/news/business/markets/indian-rupee-sinks-30-paise-on-us-rate-hike-worries-crude-spike-2874621.html | Representative Image
The rupee today sank 30 paise to close below the 70-mark against the US currency due to renewed worries about a hike in US interest rates amid global trade war jitters.
The domestic currency ended at 70.11 per dollar, a loss of 30 paise or 0.43 per cent over the previous close. In day trade, the rupee had crumbled to a session low of 70.17 per dollar.
The rupee suffered its the biggest single-day drop in past one week, snapping a two-straight session recovery trend.
Forex sentiment wobbled with a resurgent dollar as currency traders increased their expectations for a fourth interest rate hike this year after the Federal Reserve released its meeting minutes overnight.
The US Federal Reserve in meeting minutes indicated that it may hike rates again if the economy stays on track even as it flagged "ongoing trade disagreements and proposed trade measures as an important source of uncertainty and risks".
The US dollar launched a spirited recovery from its previous five days of losses and gained against its major trading peers. The US dollar index was up 0.37 per cent at 95.35 against a basket of six currencies.
Speculative traders and investors also raised short positions on the Indian rupee.
A fresh wave of global risk-aversion trade, triggered by the implementation of new tariffs by the world's two largest economies revived fears of a full-blown trade war, further added to the downbeat mood.
The US and China escalated their ongoing trade war by implementing 25 per cent tariffs on USD 16 billion worth of imports on both sides.
A sharp spike in international crude oil prices due to a combination of factors also weighed on the trading front.
The benchmark Brent was trading at USD74.55 a barrel today. The domestic currency resumed with a sharp fall at 70.02 against Tuesday's close of 69.81 at the inter-bank foreign exchange (forex) market.
Sliding down a steep wave, the rupee crumbled to hit a session low of 70.17 in mid-afternoon deals before ending at 70.11, revealing a sharp loss of 30 paise, or 0.43 per cent.
It had appreciated by 34 paise after crashing to fresh lifelows last week.
The Financial Benchmarks India private limited (FBIL), meanwhile, fixed the reference rate for the dollar at 70.0656 and for the euro at 81.0486.
The 10-year benchmark bond yield also rallied by 5 bps to 7.88 per cent.
In the cross currency trade, the rupee remained under pressure against the euro to finish at 81.21 compared to 80.44 and also drifted against British pound to settle at 90.41 per pound from 89.61 earlier.
The local unit, however recovered against the Japanese yen to close at 63.29 per 100 yens from 63.33 per 100 yens.
In forward market today, premium for dollar showed a mixed trend owing to lack of market moving factors. | rupee closes below 70.11 per dollar, a loss of 30 paise or 0.43 per cent over the previous close. rupee suffered its biggest single-day drop in past one week. a fresh wave of global risk-aversion trade revived fears of a full-blown trade war. the rupee is expected to be the most volatile currency in the world. | Negative |
https://www.financialexpress.com/market/sensex-nifty-look-to-open-with-losses-on-monday-key-factors-to-set-tone-for-equity-markets-today/2029138/ | Domestic equity market benchmarks BSE Sensex and Nifty 50 are expected to open weak following their Asian peers. On Friday Sensex soared 548 points or 1.50 points to end at 37,020, while the broader Nifty 50 index settled just above 10,900, gaining 162 points or 1.51 per cent. Headline indices, Sensex and Nifty ended the week with a gain of 1.16 per cent and 1.24 per cent, respectively. “With no major event, the on-going earnings season and global cues will continue to dictate the market trend. Besides, the progress of monsoon will also be closely watched. Markets are braving all the storms and gradually inching higher however the participation is largely limited to a handful of index majors. Traders should maintain extra caution in the selection of stocks and prefer hedged trades,” said Ajit Mishra, VP Research, Religare Broking.
SGX Nifty points to weak start: The trends on SGX Nifty were signalling a gap-down opening from BSE Sensex and Nifty 50 on Monday. Nifty futures were trading 37 points or 0.34 per cent lower at 10,894 on Singaporean Exchange.
HDFC Bank profit surges 20% in Q1: HDFC Bank reported a 19.6 per cent growth in net profit to Rs 6,658.62 crore from Rs 5,568.16 crore in Q1 FY20. Its net interest income increased 17.8 per cent for the first quarter of the financial year to Rs 15,665.4 crore from Rs 13,294.3 crore for the same period last financial year.
Earnings today: A total of 40 companies are scheduled to report their results today. The list includes names such as ACC, Den Networks, and SBI Cards and Payment Services, Bombay Dyeing, CSL Finance, Indo Amines, Maharashtra Scooters, NRB Bearings, State Trading Corporation of India Swaraj Engines. etc.
Asian markets: Stocks in Asian markets edged lower in early morning trade on Monday. Japan’s Nikkei 225 pared earlier gains and dipped 0.42%. The Topix declined 0.43% and the Hang Seng index tumbled 1%.
US market: The Dow Jones Industrial Average fell 0.23 per cent to end at 26,672.36 points, while the S&P 500 gained 0.29 per cent to 3,224.75. The Nasdaq Composite climbed 0.28 per cent to 10,503.19.
FII and DII data: On Friday, foreign institutional investors (FIIs) bought shares worth Rs 697.08 crore, while domestic institutional investors (DIIs) sold shares worth Rs 209.42 crore on a net basis, according to the provisional data available on the NSE.
Technical view by Nagaraj Shetti, Technical Research Analyst, HDFC Securities
The near term uptrend of Nifty seems to have sustained after a small dip and one may expect further upside in the coming sessions. The next upside levels to be watched around 11250, which is an opening downside gap of 5th March. Immediate support is placed at 10850. However, having stretched its uptrend above the resistance, one needs to be cautious of longs at the highs. As there is a possibility of reversal from the highs. | Sensex and Nifty 50 are expected to open weak following their Asian peers. broader Nifty 50 index settled just above 10,900, gaining 162 points or 1.51 per cent. Sensex and Nifty ended the week with a gain of 1.16 per cent and 1.24 per cent, respectively. a total of 40 companies are scheduled to report their results today. | Negative |
http://www.moneycontrol.com/news/business/markets/more-than-ltcg-dividend-tax-on-mf-pe-compression-hit-market-mood-nifty-seen-at-10450-2498289.html | Budget 2018 dampened market sentiment with bears tightening their grip on Dalal Street. Frontline indices fell more than 1.5 percent Friday and the broader markets crashed over 4 percent while on the sectoral front, Nifty Bank lost more than 500 points.
Major worry in market is the correction in midcaps that started even before the Budget and continued today with volumes on the buy side shrinking. Margin calls triggered in the morning led to sell-off in frontline stocks as well.
More than long term capital gains (LTCG) tax of 10 percent reintroduced in the Budget, introduction of a tax on distributed income by equity oriented mutual fund at the rate of 10 percent bothered investors, experts suggest.
A likely compression of price earnings, and hike in interest rates that may hit margin and finance cost for companies with debt on books also hit sentiment.
"One can ascribe this fall to LTCG, revenue deficit shortfall, political uncertainty as people get worried post Rajasthan bypolls where BJP lost the game," Ajay Srivastava of Dimensions Corporate Financial Services told CNBC-TV18.
"All in all the government is facing biggest headwinds and people are saying that true cost of demonetisation is coming to the fore. The government has no revenues to meet its political goals, which all I think bothering most to investors who are saying will this continue like this."
In this market, he said apart from economic uncertainties, political issues will also come to the fore and will become more relevant. Srivastava was thinking of happening somewhere in June-July, but it is happening now.
"MF inflows which were guaranteed with 10 percent distribution tax and were giving dividend every month, it was tax free, but now suddenly everyone is sitting with tax authorities. Now what is bothering investors is will this investment flow keep coming to MFs as now there are large segments go under tax hammer compared to earlier set up. It is not about paying tax but dealing with the tax. So all in all LTCG is not hurting sentiment but 10 percent tax on mutual funds is bothering most to investors now," he explained the major reason of worry.
Dipan Mehta, Member BSE & NSE said in an interview to CNBC-TV18 that more than LTCG, the fear in the market is about likely rise in interest rates and the process of compression of price earnings multiples but there is not threat to earnings and earnings remain intact.
Prior to Budget, market was factoring stable interest and justifying higher PE multiples, that equation may be turnaround completely, we are seeing that may be equity may not be the best asset class and we may get decent returns in fixed income as well.
On the whole, the companies which have huge debt on books wil have pressure on interest rates and margins, Mehta said.
Hemang Jani, Head Equity Sales & Advisory, Sharekhan feels the broad market is reacting negatively to the excessive focus on rural and social schemes and the return of LTCG tax.
There is stock specific pressure due to unwinding of positions in high beta stocks and the market will take few days to absorb these proposals, he said.
Srivastava feels the midcap crisis should get stabilised soon. People can hold on to stocks, don't sell out at this point of time, he advised.
Technical analysts expect this correction to continue and advised not to take long positions.
"This is a big correction and chances are that this correction will continue, getting worse. Bank Nifty already fell around 500 points, so this is going to get worse as more and more stoplosses coming, who is selling? - shortsellers as well as people are cutting down their long positions," Ashwani Gujral of ashwanigujral.com said.
He expects the big fall for 2-3 weeks. I won't be surprised if the Nifty breaks 10,400 level on the downside, he said.
Let the market gets settled and then think of taking positions in the market, he advised.
Mitessh Thakkar of miteshthacker.com said don't be hurry to buy stocks now. The Nifty may revisit its support levels of 10,550-10,590, he feels. | frontline indices fall more than 1.5 percent on friday. broader markets crash over 4 percent on the frontline. LTCG tax reintroduced in the budget. a hike in interest rates and compression of price earnings also hit sentiment. a soaring interest rate on mutual funds also hurt sentiment. a soaring interest rate on shares also hurt sentiment. | Negative |
https://economictimes.indiatimes.com/markets/forex/rupee-plunges-70-paise-as-covid-19-concerns-weigh/articleshow/74898572.cms | Mumbai: The Indian rupee tumbled by 70 paise to close at 75.59 against the US dollar on Monday as concerns around coronavirus impact on the economy continued to hurt sentiment globally. Forex traders said heavy selling in domestic equities dragged the local unit amid mounting fears of a coronavirus-led economic slowdown.Moreover, strengthening of the American currency in the international market also weighed on the domestic currency.At the interbank foreign exchange market, the rupee opened at 75.17. During the day, it lost further ground and finally settled at 75.59, down 70 paise over its previous close.The rupee had settled at 74.89 against the greenback on Friday."On the domestic front, rupee has been under pressure on back of selling by FIIs in equity and debt segment."Market participants will be keeping an eye on employment numbers that will be released from the US and weaker-than-expected economic data could keep under dollar weighed down," Motilal Oswal Financial Services Forex & Bullion Analyst Gaurang Somaiyaa said.The number of COVID-19 cases climbed to 1,071 in India on Monday, while the death toll rose to 29, according to the Union Health Ministry.The number of deaths around the world linked to the new coronavirus has touched nearly 35,000.The dollar index, which gauges the greenback's strength against a basket of six currencies, rose by 0.58 per cent to 98.93.The 10-year government bond yield was at 6.21 per cent.Global crude oil benchmark Brent fell 8.34 per cent to USD 22.85 per barrel amid concerns over global growth.On the domestic equity market front, the 30-share BSE barometer ended 1,375.27 points or 4.61 per cent lower at 28,440.32. Similarly, the NSE Nifty fell 379.15 points, or 4.38 per cent, to close at 8,281.10.Foreign institutional investors (FIIs) sold equities worth Rs 4,363.61 crore in the Indian market on Monday, as per provisional data.The Financial Benchmark India Private Ltd (FBIL) set the reference rate for the rupee/dollar at 74.8434 and for rupee/euro at 82.6411. The reference rate for rupee/British pound was fixed at 91.5604 and for rupee/100 Japanese yen at 68.89. | rupee closes at 75.59 against the dollar, down 70 paise from its previous close. rupee has been under pressure on back of selling by FIIs in equity and debt segment. number of COVID-19 cases climbed to 1,071 in india on monday. death toll from the new coronavirus has touched nearly 35,000. | Negative |
http://www.financialexpress.com/industry/banking-finance/sbi-sees-bad-loan-provisions-as-biggest-challenge/1027307/ | State Bank of India, the nation’s largest lender, sees provisioning for soured debt as the biggest challenge for the South Asian nation’s banking system even as credit growth is reviving from a three-decade low.
“Whatever process we resort to for the resolution of non-performing assets there will be a gap in the provisioning,” Chairman Rajnish Kumar said in an interview with Bloomberg Television’s Haslinda Amin on the sidelines of the World Economic Forum in Davos on Tuesday. “That is precisely where the support from the government is required. For the banking system to come out of the problem we have to provide for those loan losses that have been incurred.”
Kumar is at the forefront of helping clean up the worst soured-debt ratio among the world’s biggest economies. Overdue loans have dragged economic growth to the lowest since 2014, piling pressure on the government to revive activity before elections next year.
Prime Minister Narendra Modi’s administration has pledged to inject $33 billion of fresh capital into struggling state-run banks — including SBI — and the Reserve Bank of India has asked commercial lenders to resolve bad loans at 40 of the biggest defaulters within a year. Policy makers are betting these moves will boost loan growth from a 30-year low.
Rate Outlook
“Banks need to recapitalize, write down bad debts and be in a stronger position first,” Kumar said, referring to the government’s plan to merge some state-run banks. “We need to create a few more large banks in the country as the gap between SBI and others is very wide.”
State Bank, which accounts for more than a fifth of India’s banking assets, broke into the ranks of the world’s top 50 lenders in April after it merged with five smaller units and Bharatiya Mahila Bank Ltd. The lender is set to report earnings for the December quarter next month.
Under Kumar, the lender aims to focus on expanding loans to consumers as well as small and medium-sized enterprises. His task will probably become tougher as monetary conditions tighten. India’s inflation has breached the central bank’s target, increasing the odds the RBI will raise borrowing costs sooner than expected. It’s due to review policy Feb. 7.
“Our sense is that going forward the inflation numbers will stabilize and at least for the next six months there will not be an up-move in terms of the central bank’s policy rates and government bond yields,” Kumar said. | the nation's largest lender sees provisioning for soured debt as the biggest challenge for the south Asian nation's banking system. chairman Rajnish Kumar is at the forefront of helping clean up the worst soured-debt ratio among the world's biggest economies. overdue loans have dragged economic growth to the lowest since 2014, piling pressure on the government to revive activity before elections next year. | Negative |
https://economictimes.indiatimes.com/wealth/personal-finance-news/how-sensex-us-dollar-10-year-g-sec-performed-during-week-ending-may-21-2020/articleshow/75912877.cms | This weekly tracker keeps you updated on the benchmark stock index, bond yields , forex movements and CPI-Combined.It also tracks the changes in the past one year to give investors an idea how their investments performed over a longer period.Markets remained volatile due to Covid-19 fears and heavy selling in banking and NBFC stocks. Investors were also concerned about the chances of demand revival in the near term as the recent stimulus measures are considered inadequate.The 10-year bond yield changed little due to the adequate liquidity surplus in the system.The rupee weakened due to the strengthening US dollar , rising crude oil prices, and extension of national lockdown.The CPI-Combined for the month of March 2020 is revised to 5.84%, which fell below the RBI's upper target limit of 6%. | weekly tracker keeps you updated on the benchmark stock index, bond yields, forex movements and CPI-Combined. markets remained volatile due to Covid-19 fears and heavy selling in banking and NBFC stocks. rupee weakened due to the strengthening US dollar, rising crude oil prices, and extension of national lockdown. the rupee weakened due to the strengthening US dollar. | Negative |
https://economictimes.indiatimes.com/markets/commodities/news/gold-prices-today-slip-on-profit-booking/articleshow/76334011.cms | Gold Rates - Spot & Futures (.995 purity) (MCX) Date Gold Spot Price
Rs/ 10 grms (AHMEDABAD) Gold Future Price
Rs/ 10 grms Expiry: 05-Dec-2023 24-11-2023 61229 61295 15-11-2023 60029 60120 14-11-2023 60029 60066 13-11-2023 60029 59835 12-11-2023 60029 59775 01-11-2023 0 60742 31-10-2023 61018 61237 30-10-2023 61027 61268 27-10-2023 60629 61238 26-10-2023 60764 60968 25-10-2023 60311 60794 24-10-2023 60418 60544 GoldGold Technical Charts
NEW DELHI: Gold and silver saw profit booking on Friday as traders exited bullion counters at high level amid sharp rise in the Covid-19 cases and gloomy economic projections.Total number of Covid patients in India reached close to 3 lakh while fatalities climbed to near 8,500 levels. The numbers could also increase faster as India has eased restrictions in the most parts.Gold futures were down 0.72 per cent or Rs 342 at Rs 47,072 per 10 grams. Silver futures dropped 1.55 per cent or Rs 752 to Rs 47,887 per kg."Spot gold prices for 24 carat in Delhi traded up by Rs 477 on rupee depreciation," HDFC Securities Senior Analyst (Commodities) Tapan Patel said. Meanwhile, silver prices rose by Rs 26 to Rs 49,868 per kg.Globally, gold prices held steady on Friday as downward pressure from a stronger dollar countered rising safe-haven demand supported by gloomy economic projections and renewed fears over a second wave in COVID-19 infections.Spot gold was flat at $1,727.24 per ounce, as of 1256 GMT. U.S. gold futures fell 0.4 per cent to $1,733.30.On Wednesday, Fed officials announced the need to keep the key interest rate near zero through at least 2022, and that it would be a "long road" to recovery. Large stimulus measures and low interest rates tend to support gold, which is often considered a hedge against inflation and currency debasement.Gold has rallied about 19 per cent since touching an over three-month low of $1,450.98 on March 16. SPDR Gold Trust , the world's largest gold-backed exchange-traded fund , said its holdings rose 0.5 per cent to 1,135.05 tonnes on Thursday.Palladium was unchanged at $1,921.22 per ounce, while silver was down 0.4 per cent to $17.64, and platinum rose 0.2 per cent to $812.37. | gold futures were down 0.72 per cent or Rs 342 at Rs 47,072 per 10 grams. silver futures dropped 1.55 per cent or Rs 752 to Rs 47,887 per kg. globally, gold prices held steady on Friday as downward pressure from a stronger dollar countered rising safe-haven demand. gloomy economic projections and renewed fears over a second wave in COVID-19 infections. | Negative |
https://economictimes.indiatimes.com/industry/services/property-/-cstruction/covid-19-pandemic-drags-demand-for-office-space-down-by-30-per-cent-in-q1-2020/articleshow/75063674.cms | BENGALURU: Net absorption of office spaces in India in Q1 2020 witnessed a decline of 30% from the peak observed in Q1 2019 due to the on going health crisis globally. The last such drop was seen in Q1 2017, post demonetisation.Office absorption in Q1 2020 was backed by strong pre-commitment levels in new completions during the quarter. The quarter witnessed a net absorption of 8.6 mn sq ft of Grade A office space , out of which pre-commitments accounted for 4.9 mn sq ft, said JLL The impact of the COVID-19 pandemic became more apparent in March as most businesses defer their real estate decisions. IT- ITeS (56%) as well as co-working (13%) occupiers drove leasing activity during the quarter.“The evolving COVID-19 crisis is prompting corporates to re-evaluate their commercial real estate strategies, with a focus on enhancing resilience measures. There will be a greater emphasis on cost management, employee wellbeing and sustainability, and the adoption of flexible working practices as resilience practices ramp up,” said Ramesh Nair, CEO & Country Head, JLL.Furthermore, construction activity and the process of obtaining requisite approvals from the government also slowed down in the beginning of March, in line with growing concerns of the impact of COVID-19. “New completions were recorded at 8.6 mn sq ft in Q1 2020, a fall of 40% Y-o-Y from levels observed in Q1 2019 and representing the second largest dip witnessed in new completions in the last five years. Post demonetisation, new completions dropped to less than 20% of that seen in Q1 2016,” adds the report.The three larger markets of Bengaluru, Mumbai and Delhi NCR accounted for nearly 75% of the net absorption in Q1 2020, despite the overall decline in the overall market. Net absorption in Mumbai and Chennai more than doubled in Q1 2020 as compared to Q1 2019, led by strong leasing activity in the first two months by IT/ITeS occupiers.”The strong leasing momentum of 2019 continued in the first two months of 2020 before the pandemic impacted the Indian market in March. Several leasing deals in the final stages of negotiation were deferred as the office market witnessed a net absorption decline of 30% y-o-y. New completions also saw a fall of 40% y-o-y during Q1 2020. Several office assets in the final stages of completion were stuck owing to delays in obtaining requisite approvals from the government authorities,” said Samantak Das, Executive Director and Head of Research, REIS, JLL.The consultancy firm said that over the next few months, leasing is expected to be mainly driven by renewals and consolidation activity. With fresh take up of spaces likely to be limited, landlords might have to sit on locked in capital (completed buildings) for a relatively longer time period. Business continuity plans and remote working strategies have been successful. Hence, future demand from occupiers is likely to take into account the need for flexible workspace. | net absorption of office spaces in india in Q1 2020 witnessed a decline of 30% from the peak observed in Q1 2019. the last such drop was seen in Q1 2017, post demonetisation. the impact of the COVID-19 pandemic became more apparent in march as most businesses defer their real estate decisions. the three larger markets of Bengaluru, Mumbai and Delhi NCR accounted for nearly 75% of the net absorption in the quarter. | Negative |
https://www.moneycontrol.com/news/business/markets/franklin-templeton-fund-closure-an-eye-opener-for-rbi-umesh-mehta-5185841.html | Franklin Templeton’s fund closure is an eye-opener for the RBI that its liquidity efforts are either insufficient or are not effective in de-freezing the liquidity crisis, Umesh Mehta, Head of Research, Samco Securities, says in an interview to Moneycontrol’s Kshitij Anand.
Edited excerpts:
Q) Franklin Templeton has shut down six credit risk strategy debt funds. This is the second casualty of the coronavirus outbreak after IndiaNivesh. Do you think investors will again lose faith like they did after the 2008 financial crisis?
A) Investors currently are in a state of fear and shock but during such a crisis causalities do happen and the credit risk of debt funds is a natural extension of a liquidity crisis.
Therefore, this is not a systematic crisis but is considered a part and parcel of such downtrends. However, it is an eye-opener for the RBI that despite its liquidity efforts, these measures are either insufficient or are not effective in de-freezing the liquidity crisis.
Hopefully, now that the credit risk debt fund crisis has occurred, it is expected that things will be taken care of at the regulatory end.
Q) What can the government do to mitigate the credit crisis that led to the winding down of Franklin Templeton schemes?
A) There is a lot that the government needs to do to bring back confidence and trust in the economy but all wishes cannot be granted.
The minimum -- the government should take on the risk of credit defaults of SMEs and MSMEs such that they are able to access fresh line of credit to revive their depleting businesses.
This is similar to the government having credited a sum of Rs 2,000 and Rs 500 a month for three months for farmers and women in their Jan Dhan accounts directly.
Q) A volatile week for Indian markets but the Nifty managed to hold on to 9,000, supported by some positive global cues and expectations of a stimulus package. But it looks like 9,300 is a crucial resistance level for the Nifty50. What are your views on the market?
A) 9,300 is indeed a crucial level for the Nifty and acts as strong resistance as it is nothing but 38 percent retracement of the market’s recent fall as per Fibonacci’s retracement levels.
Such levels assume importance because even international markets are hovering around similar retracement levels. Unless we see substantial improvement in the situation on both – the COVID-19 front and the business resumption front-- we believe 9,300 will be a strong resistance level.
Q) What are the important data points and levels to watch out for in the coming week?
A) 9300-9400 levels will be a cluster of strong resistance for the market and any increase in VIX may resume the downtrend in the bourses.
Nonetheless, astute government stimulus and important policy decisions to kick start the economic engine, which is currently at standstill, are expected to be key pointers for the markets going ahead.
Q) Small and midcaps underperformed and we are seeing some stress in the broader market space. Has falling GDP growth rate made things worse for some stocks? What should investors do if they have small & midcap-focused portfolios?
A) Amid continued deterioration in the economy, small and midcaps have really been hit hard. But, this is a matter of reality, those who are strong and large will lead as and when things start to look brighter.
It is also feared that some small and midcap companies might go into oblivion in dark times like these. Some of them may even destroy complete values.
Therefore, as a prudent approach, one may consider switching from such funds to largecap frontline funds. This would certainly be a difficult decision but would pay off in the long run.
Q) There is so much volatility. Are there any all-weather stocks that one can look at?
A) Assuming that someone really wants to remain invested in equities at all times, then FMCG as a sector should act as a defensive play, although that sector, too, might see some profit booking if the market goes deeper into a recessionary spiral.
Ideally, it is said that in bull markets equity is the king and in uncertain times cash is the king. One has to remain invested selectively but at the same time keep liquidity in order to take advantage of further falls.
Investors will have a long time to pick and select stocks for investment. Beaten down sectors and stocks ideally should outperform markets once the bull market resumes and defensives would then underperform.
Disclaimer: The views and investment tips expressed by experts on Moneycontrol.com are their own and not those of the website or its management. Moneycontrol.com advises users to check with certified experts before taking any investment decisions. | Franklin Templeton has shut down six credit risk strategy debt funds. a volatile week for india but the Nifty managed to hold on to 9,000. a government-backed treasury fund is expected to be able to close in a few days. a government-backed treasury fund is expected to close in a few days. | Negative |
https://economictimes.indiatimes.com/news/company/corporate-trends/covid-effect-tatas-plan-layoffs-to-cut-fixed-costs/articleshow/76618717.cms | (This story originally appeared in on Jun 25, 2020)
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Chennai/Mumbai: The Tata Group may eliminate jobs at some of its businesses to save fixed costs as it grapples with falling profits due to the coronavirus pandemic, and global economic projections pointing to a challenging time ahead.The pandemic had led to a suspension of the conglomerate’s several businesses — including aerospace, automotive and aviation — depressing its earnings in key markets across the world. The conglomerate has already made moves to cut contract workers engaged in manufacturing and other functions at its various facilities, including at Tata Motors and its UK arm Jaguar Land Rover.Tata Motors, after sinking Rs 9,864 crore into the red in the fourth quarter of fiscal 2020, said “there are widespread opportunities to cut costs across the organisation and all actions will be taken with prudence”, without getting into specifics. The flagship of the Tata Group has initiated a cash improvement programme of Rs 6,000 crore and 5 billion pounds at its India and UK units. Sources said the company plans to axe jobs at various levels in the domestic business. The labour union at Tata Steel’s Netherlands unit said the management planned to slash 1,000 of the 9,000 jobs at the site to improve the profitability of the metal producer.The senior leadership at the group’s several businesses, including Indian Hotels Company (which runs the Taj chain), has already taken a cut in remuneration as part of a broader restructuring plan. The $113-billion conglomerate — comprising 30 companies across 10 business verticals — employs over 7.2 lakh people in India and outside the country. Tata Group has joined Reliance Industries, Raymond, Apollo Tyres and TVS Motor, where top managements have taken a pay reduction as the pandemic ravages operations. The group’s real estate unit, said sources, may also retrench employees even as it battles mismanagement allegations. “With the advent of Covid-19, we are closely monitoring the situation and assessing its impact on the real estate industry and on the company,” said a Tata Realty and Infrastructure spokesperson.Other group entities — TCS and Tata Technologies — have reduced dependency on subcontractors and cut bench strength respectively to optimise costs. | the conglomerate has already made moves to cut contract workers engaged in manufacturing and other functions at its various facilities. the $113-billion conglomerate employs over 7.2 lakh people in india and outside the country. the group's real estate unit may also retrench employees even as it battles mismanagement allegations. the group has joined Reliance Industries, Raymond, Apollo Tyres and TVS Motor, where top managements have taken a pay reduction. | Negative |
https://economictimes.indiatimes.com/markets/forex/rupee-goes-below-66-for-first-time-since-march-2017/articleshow/63840379.cms | NEW DELHI: The rupee was a bundle of nerves at the open on Friday as it sank 24 paise to a 13-month low of 66.06 against the dollar, hit by rising crude prices and fiscal deficit worries.It breached the 66 level for the first time since March 14, 2017.The domestic currency on Thursday ended at 65.82. It has emerged as the worst performer among major Asian and emerging market currencies.The rupee has fallen a staggering 60 paise in its recent bearish spell.The rapid surge in global crude oil prices has already had an adverse impact on India's import bill and can further hit the country's fiscal arithmetic, a forex dealer said.The domestic currency has been weighed down by a variety of other factors, including concerns that faster tightening of US monetary policy and President Donald Trump's protectionism will hurt the Indian economy the most and spark capital outflows, said a PTI report."The rupee continued its weakness... against the greenback on the back of firm oil prices ahead of OPEC meeting, higher US bond yields and foreign outflows. US dollar's firmness takes cues from the Fed's Beige Book, which outlined the economy to be positive despite recently imposed tariffs," Anand James, Chief Market Strategist at Geojit Financial Services, said.On the global front, Oil prices held firm on Friday near three-year highs as ongoing Opec-led supply cuts drained out excess supplies. Brent crude oil futures were at $73.87 per barrel and US WTI crude futures $68.40.Meanwhile, both Sensex and Nifty opened the day on a negative note on Friday, given weakness in banking stocks post RBI's hawkish policy stance and simmering oil prices. | rupee falls 24 paise to 13-month low of 66.06 against the dollar. rupee has emerged as the worst performer among major Asian and emerging market currencies. rupee has fallen a staggering 60 paise in its recent bearish spell. rupee has been weighed down by concerns that tightening of monetary policy will hurt the economy. | Negative |
https://www.businesstoday.in/current/world/coronavirus-in-us-covid-19-confirmed-cases-reach-half-a-million-22000-dead/story/400826.html | Americans spent a glum Easter Sunday largely confined to their homes by the still-raging coronavirus pandemic as the U.S. death toll neared 22,000, with more than half a million confirmed cases nationwide.
With 42 states imposing strict stay-at-home orders most churches were shuttered, although many erected crosses outside or even offered drive-through services conducted by priests, pastors or ministers wearing latex gloves and surgical masks.
Other Americans turned to online church services to mark the holiest day in the Christian calendar. In Louisiana, the evangelical Life Tabernacle megachurch near Baton Rouge defied local government orders to shut down, holding its Easter Sunday service as planned, said Reverend Tony Spell.
"Our rights come from our creator, not from a governing body," Spell told Reuters, adding people traveled from across the region to attend.
In some states, attempts by authorities to clamp down on Easter services have sparked legal battles over the rights of government to prevent Americans from attending church, even under pandemic conditions.
On Saturday, the Kansas Supreme Court upheld an executive order barring more than 10 people from gathering for religious and funeral services. The decision, a victory for Democratic Governor Laura Kelly, followed an attempt by a Republican-led legislative body to overturn the order.
The United States, with the world's third-largest population, has recorded more fatalities from COVID-19 than any other country, nearly 22,000 as of Sunday evening according to a Reuters tally.
Roughly 2,000 deaths a day were reported for the last four days in a row, the largest number in and around New York City. Even that is viewed as understated, as New York is still figuring out how best to include a surge in deaths at home in its official statistics. As the death toll has mounted, President Donald Trump mulled when the country might begin to see a return to normality.
Trump Eyes May 1
The sweeping restrictions on non-essential movement now applied to most Americans have damaged the economy, taken a painful toll on commerce and raised questions over how long business closures and travel curbs can be sustained. The number of Americans seeking unemployment benefits in the last three weeks surpassed 16 million.
The Trump administration sees May 1 as a potential date for easing the restrictions, the commissioner of the Food and Drug Administration, Stephen Hahn, said on Sunday. But he cautioned that it was still too early to say whether that goal would be met.
"We see light at the end of the tunnel," Hahn told ABC's "This Week," adding, "Public safety and the welfare of the American people has to come first. That has to ultimately drive these decisions."
In the latest sign of the disruption wrought by the disease, one of the nation's largest pork processing plants was shuttered after workers fell ill, and its owner warned the country was moving "perilously close to the edge" in supplies for grocers.
"It is impossible to keep our grocery stores stocked if our plants are not running," Ken Sullivan, chief executive of Smithfield Foods, said in a statement on Sunday.
Dozens of workers at a beef production plant in Greeley, Colorado, have tested positive for COVID-19, according to its owner, meatpacking company JBS USA. The union representing workers at the plant said two employees have died.
In recent days, public health experts and some governors have pointed to some hopeful signs that the worst of the pandemic might be past.
Dr. Anthony Fauci, the country's top U.S. infectious disease expert, said he was cautiously optimistic and pointed to the New York metropolitan area, which had its highest daily death toll last week but also saw a decrease in hospitalizations, intensive care admissions and the need to intubate critically ill patients.
"Once you turn that corner, hopefully you'll see a very sharp decline and then you can start thinking about how we can keep it that way," Fauci told CNN's "State of the Union." "If all of a sudden we decide 'OK, it's May whatever,' and we just turn the switch on, that could be a real problem."
Fauci and other public health experts say widespread testing will be key to efforts to reopen the economy, including antibody tests to find out who has already had the disease and could be safe to return to work.
New government data shows a summer surge in infections if stay-at-home orders are lifted after only 30 days, according to projections first reported by the New York Times and confirmed by a Department of Homeland Security official.
INDIA CORONAVIRUS TRACKER: BusinessToday.In brings you a daily tracker as coronavirus cases continue to spread. Here is the state-wise data on total cases, fatalities and recoveries in one comprehensive graphic
Also read: India asks US to extend Indians H-1B visa amid coronavirus pandemic
Also read: Coronavirus India live updates: 308 people dead in the country as active COVID-19 cases near 8,000-mark | more than half a million confirmed cases of coronavirus in the u.s. have been confirmed. the death toll from the pandemic is 22,000. the death toll has risen to 22,000. the president mulled when the country might see a return to normality. a u.s. official says the death toll is "significant" | Negative |
https://www.financialexpress.com/economy/coronavirus-pandemic-impact-exports-collapse-by-35-in-march-more-pains-in-sight/1929678/ | Merchandise exports crashed by almost 35% year-on-year in March to $21.4 billion, the sharpest monthly decline in at least three decades since liberalisation, and imports plunged by 28.7%, as the COVID-19 outbreak and a consequent lockdown since March 24 wrought havoc on external trade. Trade deficit narrowed to a 13-month low of $9.75 billion in March.
With close to a half of their orders cancelled now and the nation-wide lockdown extended up to May 3, exporters warn of a much steeper decline in both outbound and inbound shipments in April. In any case, key markets — the US and the EU — have been badly hit by the pandemic.
Merchandise exports, which had already contracted by 1.5% y-o-y up to February, ended the last fiscal with a 4.8% fall to $314.3 billion. Imports dropped 9.1% in FY20 to $467.2 billion.
Barring iron ore, exports of all the 30 major groups witnessed a contraction last month. The sharpest slide was witnessed in oil meals (70%), followed by meat, dairy and poultry (45.5%), engineering goods (42.3%), gems and jewellery (41%), leather and leather products (36.8%), plastics and linoleum (35.7%), garments (-34.9%) and carpets (34.7%). Petroleum product exports dropped 31.1%, partly due to a crash in prices, while rice exports declined by 28.3% and electronics goods by 21.5%.
Core (non-oil and non-gold) exports dropped by 34.2% in March, while such imports fell by 29.1%.
Overseas buyers are using the crisis to renegotiate contract terms and seek a cut in product prices. Domestic manufacturing units are shut and logistics chains in tatters, even though ports are functioning. However, with the government allowing some units to start operations, the situation is expected to ease in May, say exporters. But external headwinds and subdued domestic manufacturing continue to hurt exports. Even a depreciation of the rupee against the dollar is hardly any consolation, as the currencies of some of the competitors like Indonesia and Malaysia have weakened at a faster pace.
Most of the top 25 destinations for engineering goods exports are facing a lockdown. These 25 markets together accounted for $53 billion of the $71 billion worth outbound shipments of these products in the April-February period, said Ravi Sehgal, chairman of EEPC India.
The Federation of Indian Export Organisations president Sharad Kumar Saraf cited the cancellation of over 50% of orders, gloomy forecast, major job losses and rising NPAs amongst exporting units to urge the government to immediately announce a relief package for exports. “COVID-19 interest-free working capital term loan to exporters to cover the cost of wages, rental and utilities, EPF and ESIC waiver for 3 months from March to May 2020 and extension of pre- and post-shipment credit by 90-180 days on their maturity are the much needed steps to help the exporting community during such difficult and testing times,” he said. | exports fell by almost 35% year-on-year in march to $21.4 billion. imports plunged by 28.7% as COVID-19 outbreak wrought havoc on trade. trade deficit narrowed to a 13-month low of $9.75 billion in march. exporters warn of steeper decline in both outbound and inbound shipments. | Negative |
https://www.moneycontrol.com/news/business/with-an-eye-on-faltering-rupee-rbi-expected-to-raise-rates-next-week-2987481.html | The Reserve Bank of India is likely to raise interest rates in early October, despite relatively tame inflation, to prop up a retreating rupee, according to a Reuters poll of economists who also trimmed their near-term growth forecasts.
In an abrupt change from the last survey conducted two months ago, which predicted rates would stay on hold until this quarter next year, two-thirds of 61 economists polled September 19-25 said the RBI would lift the repo rate at least once by year-end.
Slightly over half said RBI Governor Urjit Patel and the Monetary Policy Committee would deliver a 25-basis-point rise to 6.75 percent at the October 5 policy meeting, with one economist calling for a 50-basis-point rise.
The predicted rate hike would be the RBI's third this year, having lifted borrowing costs in June and August. The US Federal Reserve is forecast to raise rates this week - its third this year - according a separate Reuters poll.
For many analysts, the retreating Indian rupee, which has tumbled nearly 15 percent since the start of the year and is the worst-performing major Asian currency, is likely of concern to policymakers.
On Tuesday the rupee, hit recently by growing credit concerns engulfing non-banking financial companies, was trading at 72.68 to the dollar.
The finance ministry also wants RBI to boost liquidity.
"For the RBI, I think it becomes necessary to provide a policy response. The question was only of timing," said Radhika Rao, economist at DBS in Singapore.
"Some would say it (rate hike) could have come sooner ... it probably would have been a bit more beneficial. But better now than never."
If the RBI does raise rates, it would be the latest in a series of emerging market central banks that have been pressured into tightening policy in response to a tumbling currency.
Fortunately for the RBI, the economy is doing well. The Indian economy is forecast to expand by an annual rate of more than 7 percent every quarter for the next two years, although slower than the surprise 8.2 percent rate clocked last quarter.
This means that India will remain the world's fastest growing major economy, but economists have chopped forecasts somewhat for coming quarters.
"Although the high growth rate in Q2 might be partly attributed to favourable base effects ... the underlying dynamics of the Indian economy shows that virtually all high-frequency data is flashing green," said Hugo Erken, senior economist at Rabobank.
Prices of crude oil - the country's biggest import have surged by over 20 percent this year. That in turn has swollen the current account gap to 1.9 percent of GDP, swinging to deficit from a small surplus of 0.7 percent a year ago.
That gap is forecast to widen further to 2.8 percent of GDP by the fiscal year ending in March 2019, before easing slightly to 2.5 percent in 2019-20.
Just over half of 49 respondents who answered an additional question said the biggest economic risk over the coming year was higher fuel prices.
The escalating US-China trade war has not had a major impact on India so far but has spurred on a broad selloff in emerging market assets since the beginning of this year.
The sharp fall in the rupee has not stirred much worry about inflation, however, which was just under 3.7 percent in August, slightly below the 4 percent where the RBI prefers it to be.
It is expected to average 4.1 percent this quarter and next, but rise to 5 percent by the middle of 2019 - significantly lower than the predictions in the last poll two months ago.
Economists were almost evenly split on whether a weaker rupee posed the biggest upside risk to inflation, with 26 of 51 respondents saying it was.
But even if the RBI raises rates on October 4, it will still struggle to keep up with the Fed, which is expected to keep tighten policy well into next year.
"The RBI will have to do more, though that looks unlikely on the grounds of on-target inflation and stress in the financial sector," Prakash Sakpal, Asia economist at ING, wrote in a research note. | two-thirds of economists polled say RBI will raise rates in early October. rupee has tumbled nearly 15 percent since start of year. rupee is worst-performing major Asian currency. RBI is forecast to expand by an annual rate of more than 7 percent every quarter. but economists have cut forecasts somewhat for coming quarters. RBI is expected to raise rates in early october. | Negative |
https://www.moneycontrol.com/news/business/coronavirus-the-pandemic-will-permanently-change-the-auto-industry-5273231.html | Some automakers may emerge stronger, others too weak to survive on their own. Factories will shut down. The pressure to go electric could become more intense.
People may travel less now that they have discovered how much they can get done from home. Or they may commute more by car to avoid jostling with others on crowded buses and trains.
The auto industry was bracing for a brutal year even before the coronavirus idled factories, closed dealerships and sent sales into a free fall. Now, things are about to get really Darwinian: The industry is expected to realign in ways that could have a profound effect on the eight million people worldwide who work for vehicle manufacturers.
It took almost a decade for car sales in the European Union to recover from the recession that began in 2008. The US market took about five years to bounce back, but sales have been flat since 2015. Explosive growth in China initially helped compensate, but the market has been in decline since 2018. As Volkswagen, Daimler, Fiat Chrysler and other companies slowly restart their assembly lines, people who work in the car business are beginning to ponder what the repercussions of this crisis will be.
COVID-19 Vaccine Frequently Asked Questions View more How does a vaccine work? A vaccine works by mimicking a natural infection. A vaccine not only induces immune response to protect people from any future COVID-19 infection, but also helps quickly build herd immunity to put an end to the pandemic. Herd immunity occurs when a sufficient percentage of a population becomes immune to a disease, making the spread of disease from person to person unlikely. The good news is that SARS-CoV-2 virus has been fairly stable, which increases the viability of a vaccine. How many types of vaccines are there? There are broadly four types of vaccine — one, a vaccine based on the whole virus (this could be either inactivated, or an attenuated [weakened] virus vaccine); two, a non-replicating viral vector vaccine that uses a benign virus as vector that carries the antigen of SARS-CoV; three, nucleic-acid vaccines that have genetic material like DNA and RNA of antigens like spike protein given to a person, helping human cells decode genetic material and produce the vaccine; and four, protein subunit vaccine wherein the recombinant proteins of SARS-COV-2 along with an adjuvant (booster) is given as a vaccine. What does it take to develop a vaccine of this kind? Vaccine development is a long, complex process. Unlike drugs that are given to people with a diseased, vaccines are given to healthy people and also vulnerable sections such as children, pregnant women and the elderly. So rigorous tests are compulsory. History says that the fastest time it took to develop a vaccine is five years, but it usually takes double or sometimes triple that time. View more Show
“We shouldn’t be too optimistic and expect that in 2021 everything is going to go back to normal as if nothing happened,” Ola Källenius, the Chief Executive of Daimler, told reporters during a recent conference call. The pandemic, he said, “will probably have a huge effect on the economy and we have to prepare.”
Here’s a look at what to expect.
Factory closures and labour strifeAutomakers worldwide had at least 20 percent more factory capacity than they needed before the coronavirus hit, analysts say. That idle manufacturing space cost them money without producing any profit. As sales plummet further, shutting down underused plants may be a matter of survival.
“Some of those big plants in Europe are going to really struggle,” said Peter Wells, Director of the Centre for Automotive Industry Research at Cardiff Business School in Wales. The going will be especially tough for the companies that make smaller cars, which tend to be less profitable, like Fiat, Renault or Volkswagen’s SEAT brand.
In Europe, it’s impossible to close a factory without labour strife and political resistance because so many jobs are at stake. Severance payments to workers and other costs can make it as expensive to shutter a plant as it is to build one.
“It’s about the politics more than the economics,” Wells said.
In an example of the kind of fights that may lie ahead, workers shut down a Nissan plant in Barcelona only two days after it opened in early May, demanding that the Japanese company commit to maintaining its presence in Spain.
Electric cars could come sooner (maybe)Sales of electric cars have been surprisingly resilient even as lockdowns gutted sales of gasoline and diesel powered vehicles.
In March, as much of Europe went into lockdown, car sales on the continent fell by more than half. But registrations of battery-powered cars surged 23 percent, according to Matthias Schmidt, an analyst in Berlin who tracks the industry.
In April, lockdowns caught up with electric cars, too, and their sales fell 31 percent, according to Schmidt’s estimate. But that was nothing compared with the total European car market, which plummeted 80 percent.
It is not clear whether the surge in electric car sales is a trend or a quirk. Many of the electric vehicles registered early this year had been ordered earlier, Schmidt said. Carmakers may have taken their time delivering cars that were bought in 2019 so the vehicles would help meet stricter European Union limits on carbon dioxide emissions that took effect in 2020.
Carmakers may not be as motivated to sell electric cars in coming months. They will be tempted to instead push SUVs, which generate far greater profits and are easier to sell now that fuel prices have plunged.
Much will depend on government incentives and regulations. Europe and China are doing more to promote electric cars than the United States under the Trump administration. Battery-powered cars are still much more expensive than gasoline vehicles. In a recession, fewer people may be able to afford them without subsidies.
An opening for startupsTurmoil in the market could be good for electric car startups like Byton and Lucid, which have proliferated after Tesla showed it was possible to challenge the traditional carmakers. The startups have a chance to attack the market while the established companies are struggling.
“The spaces in the market might open up a bit,” Wells said. “Once the fractures start to emerge, things start to happen.”
For other challengers, the pandemic has been a huge setback. Ride-hailing services like Uber and Lyft, which threatened to make car ownership obsolete for urban residents, have suffered because everyone is staying home. The Silicon Valley companies that promised self-driving cars by 2020 are still years away, and the pandemic is interfering with the human road testing they need to perfect their technology.
Get ’em while they’re cheapFew sectors get less love from investors than the old-line carmakers. Shares in Renault, for example, have fallen 70 percent in the last year, and the stock market values the company at just 5.7 billion euro, or $6.2 billion. (Billionaires like Jeff Bezos, Michael Bloomberg and Elon Musk are worth far more as individuals than Renault with its 180,000 workers and sales of 3.8 million cars last year.)
There may be one group of investors willing to overlook the high risk and meagre profits of car making. Chinese investors could see rock-bottom valuations as an opportunity to get a foothold on the continent.
Geely Holding, a carmaker based in Hangzhou, set a precedent when it bought Volvo Cars from Ford in 2010. Geely also own 8 percent of Volvo AB, a Swedish truck maker that is separate from the car company. Geely’s Chairman, Li Shufu, owns almost 10 percent of Daimler. The Chinese automaker BAIC Group owns another 5 percent of Daimler.
Further incursions by Chinese investors are certain to meet political resistance. Germany is expected to pass legislation making it easier to block foreign acquisitions. France has passed similar legislation, and has significant sway over Renault because it owns 15 percent of the shares.
But foreign investment might be welcome if it helps preserve jobs. Geely has revived Volvo Cars and the region around its home base in Goteborg, Sweden.
Pair up or perishCarmakers will face even more pressure to spread around the cost of developing electric cars and other new technologies. Existing partnerships, such as the one between Volkswagen and Ford Motor to develop autonomous driving software, could be expanded.
“It’s pretty likely that we will see former enemies or former competitors start to team up with each other,” said Axel Schmidt, a Senior Managing Director at the consulting firm Accenture who focuses on the auto industry.
These alliances, though crucial, are tough to manage. Renault has struggled to overcome tensions with its longtime partner, Nissan.
Rethinking globalisationThe pandemic exposed just how interconnected the world is and how a factory closure in one part of the world can shut down an assembly line in a different hemisphere.
“What we are all learning, and I talk to a lot of managers and CEOs in Germany, is that we all have to rethink our logistics and supply chains,” said Olaf Berlien, Chief Executive of Osram, a German maker of lighting products for autos and other uses.
“Because of the price pressure that we are all under, we took the cheapest provider wherever in the world it might have been,” Berlien said. “We undervalued the provider who was just around the corner.”
Others are not so sure that carmakers will be more willing to buy local. Källenius of Daimler said supply chains were already built to withstand disruption and had stood up well during the crisis. Not a single Mercedes went unbuilt because of a supply chain problem, he said.
“I wouldn’t come too quickly to the conclusion that we have to regionalise supply chains,” Källenius said. “The globalisation that we have achieved in the last 20 years has led to enormous productivity gains. I would see it as a mistake to back away from that.”
c.2020 The New York Times Company | automakers may emerge stronger, others too weak to survive on their own. the pressure to go electric could become more intense, says dr. ed husain. husain: industry expected to realign in ways that could have profound effect on workers. he says it took almost a decade for car sales in the eu to recover from the recession. | Negative |
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Dataset Card for Dataset Name
The FinancialNewsSentiment_26000 dataset comprises 26,000 rows of financial news articles related to the Indian market. It features four columns: URL, Content (scrapped content), Summary (generated using the T5-base model), and Sentiment Analysis (gathered using the GPT add-on for Google Sheets). The dataset is designed for sentiment analysis tasks, providing a comprehensive view of sentiments expressed in financial news.
Dataset Description
- Curated by: Khushi Dave
- Language(s): English
- Type: Text
- Domain: Financial, Economy
- Size: 112,293 KB
- Dataset: Version: 1.0
- Last Updated: 01/01/2024
Dataset Sources
Uses
Sentiment Analysis Research: Ideal for exploring sentiment nuances in Indian financial news.
NLP Projects: Enhance NLP models with diverse financial text for improved understanding.
Algorithmic Trading Strategies: Study correlations between sentiment shifts and market movements.
News Aggregation: Generate concise summaries with sentiment insights for financial news.
Educational Resource: Hands-on examples for teaching sentiment analysis and financial text processing.
Ethical AI Exploration: Analyze biases in sentiment analysis models for ethical AI research.
Model Benchmarking: Evaluate and benchmark sentiment analysis models for financial text.
Note: Use cautiously; do not rely solely on model predictions for financial decision-making.
Dataset Creation
- Format: String
- Columns: URL: URL of the news article
Content: Scrapped content of the news article
Summary: Summarized version using T5-base
Sentiment Analysis: Sentiment labels (Positive, Negative, Neutral) gathered using the GPT add-on
Data Collection
Source Selection: Aggregation of Indian financial news articles from reputable sources covering a range of topics.
URL Scrapping: Extraction of URLs for each article to maintain a connection between the dataset and the original content.
Content Scrapping: Extraction of article content for analysis and modeling purposes.
Summarization: Utilization of the T5-base model from Hugging Face for content summarization.
Sentiment Annotation: Manual sentiment labeling using the GPT add-on for Google Sheets to categorize each article as Positive, Negative, or Neutral.
Data Processing:
Cleaning and Tokenization: Standard preprocessing techniques were applied to clean and tokenize the content, ensuring uniformity and consistency.
Format Standardization: Conversion of data into a structured format with columns: URL, Content, Summary, and Sentiment Analysis.
Dataset Splitting: Given the subjective nature of sentiments, the dataset was not split into training, validation, and testing sets. Users are encouraged to customize splits based on their specific use cases.
Tools and Libraries:
Beautiful Soup: Used for web scraping to extract content from HTML. Hugging Face Transformers: Employed for summarization using the T5-base model. GPT Add-on for Google Sheets: Facilitated manual sentiment annotation. Pandas: Utilized for data manipulation and structuring.
Citation
@dataset{AuthorYearFinancialNewsSentiment_26000,
author = {Dave, Khushi},
year = {2024},
title = {IndiaFinanceSent Corpus},
url = {[https://huggingface.co/datasets/kdave/Indian_Financial_News]},
}
Dataset Card Authors
Khushi Dave, Data Scientist
- Downloads last month
- 169
Size of downloaded dataset files:
115 MB
Size of the auto-converted Parquet files:
60.9 MB
Number of rows:
26,961
Models trained or fine-tuned on kdave/Indian_Financial_News