Stocks in India opened in the green this morning in line with global indices as governments across the world begin to ease lockdown measures.

Join us as we follow the top business news through the day.

Traders bet on negative interest rates

Sensex surges 622 points; HDFC rallies over 5%

The benchmark indices that opened with modest gains managed to rally further in the latter half of the day.

PTI reports: "Equity benchmark Sensex rallied 622 points on Wednesday, propelled by gains in index-heavyweights HDFC twins and Reliance Industries despite weak cues from global markets.

The 30-share index settled 622.44 points or 2.06 per cent higher at 30,818.61, while the NSE Nifty rose 187.45 points, or 2.11 cent, to end at 9,066.55.

HDFC was the top gainer in the Sensex pack, surging over 5 per cent, followed by M&M, L&T, Tata Steel, Bajaj Finance, HDFC Bank and Sun Pharma.

On the other hand, IndusInd Bank, Hero MotoCorp, Bharti Airtel and Asian Paints finished in the red.

While stock-specific action led benchmarks higher, experts forecast continued volatility in the near-term amid rising number of coronavirus cases in the country."

Stimulus package lacks major near-term support for economy: Report

Yet another reports that flays the Centre's stimulus package for not doing enough to address near-term risks.

PTI reports: "The government’s Rs 20 lakh crore fiscal stimulus package lacks major near-term support for the economy and may not be adequate to restore the country’s growth, Credit Suisse Wealth Management said in a report.

On May 12, Prime Minister Narendra Modi announced a package worth Rs 20 lakh crore, or nearly 10 per cent of GDP, to mitigate the economic impact of the coronavirus crisis.

“India’s response to the COVID-19 crisis lacks major or innovative near-term fiscal support, and fails to provide the much-needed impetus to stimulate growth and kick-start economic growth,” Credit Suisse Wealth Management’s Head (India Equity Research), Jitendra Gohil, said in India Market Outlook and Strategy report.

Of the Rs 20 lakh crore package announced, actual fiscal spending of around Rs 2 lakh crore (only 1 per cent of GDP) shows fiscal caution in the government measures, he said.

Given the country’s deteriorating GDP growth, the lack of fiscal support could hurt the economy more than it helps, he added.

“With no nominal GDP growth, India’s already high debt to GDP ratio (expected to cross 80 per cent in the current fiscal) - a key metric for rating agencies - could increase further and reach to levels that might be of a concern for India’s credit rating,” Gohil said.

While the government’s continuous focus on providing structural reforms is positive, the implementation of these reforms should be swift and efficient, he said."

57% investors say Big-4 auditors have no credibility

A survey result that casts doubt on the credibility of Big-4 auditors.

PTI reports: "In more troubles for the auditing fraternity, an investor survey has found that 57 per cent large investors and sell-side analysts do not have any faith in the Big-4 audit firms as they have lost credibility.

According to a survey by Institutional Investor Advisory Services of 63 large investors and sell-side analysts numbering 89, conducted online between April 13-21, as much as 57 per cent of each of them have found “the Big-4 audit firms having lost their credibility with investors and are therefore open to move beyond them if they were banned“.

Between qualified and unqualified accounts, 73 per cent support qualified accounts because they feel that at least they got to hear auditor concerns and if they asked for lean accounts, the risk was that the auditors would be muzzled.

It can be noted that ever since Satyam Computers scandal that came out in January 2009 the audit world, especially the Big Four, have been under fire from the regulators.

While market watchdog Securities and Exchange Board had banned PwC in 2018 from auditing listed companies for two years in the Satyam scam, the Securities Appellate Tribunal quashed the ban and the Sebi challenged it.

In June 2019, the Reserve Bank barred SR Batliboi & Company, an affiliate of EY, from carrying out statutory audit of commercial banks for a year after it found several lapses in the books of Yes Bank.

On top of these, there have been frequent resignation of auditors, creating doubts on the quality of the audits that is being presented to investors and also many instances of divergent audit reports."

Rs 90,000 crore liquidity injection a breather for power gencos

It looks like the Centre's bailout for power generation companies has come at just the right time.

PTI reports: "The government’s move to provide Rs 90,000 crore loans to state power distribution companies (discom) comes at an opportune time and will help clear a significant part of their obligations to power generation companies (genco), according to Crisil Ratings.

In statement, Crisil noted that the loans are to be provided through the Power Finance Corporation (PFC) and the Rural Electrification Corporation (REC) against receivables of discoms backed by state government guarantees and it will come at a time when 53 GW coal capacities of independent power producers, excluding 22 GW under debt resolution, are facing the ramifications of the liquidity squeeze at discoms.

There has been a big fall in electricity demand from high-tariff paying industrial and commercial consumers, and collection efficiencies of discoms have also dropped because of the lockdown, Crisil noted, adding that this has raised the risk of discoms either curtailing electricity purchases, or delaying payments based on high-cost power purchase agreements.

“The bulk of these 53 GW capacities can withstand cash flow pressures owing to their liquidity buffer and/or parentage. But the risk would be higher for 9.4 GW of capacities (with debt of Rs 49,000 crore) because their liquidity cushion is so low, an additional delay of even one month can cause them to default on financial obligations,” said Manish Gupta, Senior Director, Crisil Ratings.

Ola to layoff 1,400 staff as COVID-19 pandemic hits revenues

After Zomato and Swiggy, another major player in the country's gig economy has announced layoffs.

PTI reports: "Cab aggregator Ola is laying off 1,400 staff from rides, financial services and food business as revenues declined by 95 per cent in the last two months due to coronavirus pandemic, a note by CEO Bhavish Aggarwal said.

In an email to employees, Aggarwal made it clear that the prognosis ahead for the business is “very unclear and uncertain” and the impact of this crisis is “definitely going to be long-drawn for us“.

“The fallout of the virus has been very tough for our industry in particular. Our revenue has come down 95 per cent over the past 2 months. Most importantly, this crisis has affected the livelihoods of millions of our drivers and their families across India and our international geographies,” he said.

The company has decided to downsize and “let go” of 1,400 employees, Aggarwal added"

Chennai-based start-up raises funds to focus on Artificial Intelligence

Chennai-headquartered Vakilsearch, an online platform for legal, tax and compliance services, has raised an undisclosed sum from technology growth investor Sujeet Kumar, co-founder of Udaan. Prior to Udaan, Mr. Sujeet was president of operations at Flipkart. The start-up intends to use the funds raised for engineering, specifically in machine learning and AI (artificial intelligence)

Hrishikesh Datar, CEO of Vakilsearch, told The Hindu that when it comes to business registration pan-India, his start-up has helped in incorporating 10% of all new private limited companies. He said, “Close to 70% of the companies we set up stay with us for ongoing GST, RoC and accounting support. We see COVID-19 as an opportunity, with businesses increasingly going online to stay compliant and seek professional help,” he added.

Watch | Mukesh Ambani could be a trillionaire by 2033

Mukesh Ambani could become a trillionaire at the age of 75 in 2033, according to a study by Comparisun. Ambani is chairman and managing director of Reliance Industries. He is now valued at $36.8 billion according to Forbes.

The study compared 25 individuals, out of which only eleven have a realistic chance of becoming a trillionaire during their lifetime.

Amazon founder and CEO Jeff Bezos could potentially become the world's first trillionaire. The study says this is possible by 2026, when Bezos will be 62 years old. Chinese real estate tycoon Xu Jiayin will follow Bezos to become the second trillionaire in the world in 2027.

Alibaba’s Jack Ma could become a trillionaire in 2030 when he will be 65. Facebook founder Mark Zuckerberg’s current rate of growth would see him worth $1 trillion in 2035 when he will be 51 years old.

The other individuals in the list include Ma Huateng, Chairman and CEO of Tencent Holdings; Bernard Arnault, CEO of Moet Hennessy parent LVMH, who oversees an empire of 70 brands including Louis Vuitton and Sephora; Former Microsoft CEO Steve Ballmer, who led the company from 2000 to 2014; American entrepreneur and Dell Technologies founder Michael Dell; and Google co-founders Larry Page and Sergey Brin.

Ujjivan Small Finance Bank rallies over 6% post Q4 earnings

The microfinance lender's March quarter results have impressed investors, although much of the impact of the lockdown will be known only in the June quarter.

PTI reports: "Shares of Ujjivan Small Finance Bank rose over 6 per cent on Wednesday after the company reported a 15 per cent rise in net profit for the fourth quarter ended March 2020.

The company’s stock gained 6 per cent to Rs 28.15 on BSE. It rallied 6.40 per cent to Rs 28.25 on NSE.

Ujjivan Small Finance Bank on Tuesday reported a 15 per cent rise in net profit to Rs 73.15 crore for the fourth quarter ended March 2020.

The bank had posted a net profit of Rs 63.78 crore in the year-ago period, it said.

Total income rose to Rs 809.65 crore during the quarter under review from Rs 602.23 crore in the corresponding quarter a year ago.

The bank expects the mass market to show resilience and recover strongly and the economic package announced by government would also boost recovery and open various opportunities, it said."

Oil steady as economic worries offset signs of firmer demand

The oil market has shown some decent strength in decent weeks as the global lockdown is eased.

Reuters reports: "Oil prices held steady on Wednesday despite signs of improving demand and a drawdown in U.S. crude inventories, as worries over the economic fallout from the coronavirus pandemic capped gains.

Brent crude futures for July delivery were up 10 cents, or 0.3%, at $34.75 per barrel at 0626 GMT.

U.S. West Texas Intermediate (WTI) crude futures for July were down 2 cents at $31.94 a barrel after closing up 1% in the previous session.

The June contract expired on Tuesday at $32.50 a barrel, up 2.1%, as the WTI futures market avoided the chaos of last month's May expiry, when prices sank below zero.

Oil prices have mainly risen during the past three weeks, with both benchmarks climbing above $30 for the first time in more than a month on Monday, supported by massive output cuts by major oil producing countries and signs of improving demand.

U.S. crude inventories fell by 4.8 million barrels to 521.3 million barrels in the week to May 15, data from industry group the American Petroleum Institute (API) showed on Tuesday.

Refinery runs rose by 229,000 barrels per day, the API said, indicating plants are trying to produce more fuel as the United States eases its lockdowns."

OYO sees revival next quarter, seeks graded opening of hotels

Softbank-backed OYO expects to see some revival in business starting next quarter, the company’s CEO for India and South Asia, Rohit Kapoor, said on Tuesday, adding that the hospitality firm’s only appeal to the government is to allow graded opening of hotels.

“My sense is that we are looking at a recovery starting in the next quarter and coming back to the pre-COVID levels, if you ask people, the range is anywhere between six and 24 months, I am more towards the six month side than the 24 month side... I don’t have any data or information which is more scientific,” Mr. Kapoor said.

Most Asian currencies adrift as vaccine doubts dent risk sentiment

Investors continue to prefer the US dollar as virus fears continue to linger.

Reuters reports: "Asian currencies struggled to find direction on Wednesday after a report raised questions about the effectiveness of an early-stage COVID-19 trial vaccine, ending the risk-on momentum that had boosted the region's riskier assets in the previous session.

Most stock markets in the region inched down and the few trading in the black saw only incremental gains, after a subdued session on Wall Street.

Overnight, medical news website STAT reported that several vaccine experts had said the effectiveness of Moderna Inc's coronavirus vaccine could not be determined due to scanty details released in its preliminary trial result.

Optimism over the potential vaccine did not last long and market nerves have returned, Robert Carnell, ING's regional head of research for Asia-Pacific, wrote in a note. “By this morning, doubts appear to be growing, though it is worth bearing in mind that this U.S. firm is just one of many developing a vaccine worldwide, and there are some promising signs elsewhere,” Carnell wrote."

Earnings calls got longer in the latest quarter

Rupee rises 6 paise to 75.60 against US dollar in early trade

The positive sentiment in domestic equities has worked to the favor of the rupee.

PTI reports: "The rupee appreciated 6 paise to 75.60 against the US dollar in early trade on Wednesday tracking positive opening of domestic equities.

Forex traders said a positive start of domestic stocks supported the local unit, while sustained foreign fund outflows and concerns over coronavirus pandemic weighed on the local unit.

At the interbank foreign exchange, the rupee opened at 75.60, registering a rise of 6 paise over its previous close.

On Tuesday, the rupee had settled at 75.66 against the US dollar.

Domestic bourses were trading on a positive note with the benchmark Sensex trading 281.53 points higher at 30,477.70 and broader Nifty rising 87.20 points to 8,966.30.

Meanwhile, the dollar index, which gauges the greenback’s strength against a basket of six currencies, was trading 0.09 per cent higher at 99.46.

Traders said investor sentiment remained fragile amid concerns over the impact of coronavirus outbreak on the domestic as well as global economy."

Telecom tariffs still unsustainable, says Airtel

Even though the telecom industry has witnessed some ‘repairs’, more needs to be done on tariffs which are still ‘unsustainably low’, Gopal Vittal, MD and CEO, India & South Asia, Bharti Airtel said on Tuesday.

The company, which on Monday had posted a loss of ₹5,237 crore for the January-March 2020 quarter due to an exceptional charge on account of reassessment of statutory dues, is hopeful of achieving an average revenue per user (ARPU) of ₹200 in the short-term, as against ₹154 in the reported quarter. This is against an ARPU of ₹135 in the October-December 2012 period, and ₹123 in the year-ago quarter.

Stimulus will not trigger consumption, says Crisil

The ₹20 lakh crore financial package announced by the aims at the ‘right corners’ but is not a consumption trigger, according to ratings agency Crisil.

Considering the earlier announced measures worth ₹ 9.9 lakh crore (RBI’s liquidity support and others), the financial support works out to ₹20.9 lakh crore.

“While most of the steps are in the right direction, it is unlikely to stimulate demand/ consumption given that the package is more focussed on supply-side reforms,” said Crisil in a report.

Sensex surges over 300 points in opening trade; Nifty tests 8,950

The benchmark indices are off to a strong start this morning.

PTI reports: "Equity benchmark Sensex jumped over 300 points in opening session on Wednesday tracking gains in index-heavyweights ITC, HDFC twins and HUL amid mixed cues from global markets.

After rising to 30,524.53, the 30-share index was trading at 217.69 points or 0.72 per cent higher at 30,413.86.

Similarly, NSE Nifty rose 57.70 points, or 0.65 per cent, to 8,936.80.

ITC was the top gainer in the Sensex pack, surging around 3 per cent, followed by L&T, Tata Steel, NTPC, HUL, PowerGrid, HDFC twins and UltraTech Cement.

On the other hand, Hero MotoCorp, IndusInd Bank, Bajaj Finance, Asian Paints and SBI were among the laggards.

In the previous session, the BSE barometer settled 167.19 points or 0.56 per cent higher at 30,196.17, while the broader Nifty advanced 55.85 points or 0.63 per cent to end at 8,879.10.

Foreign portfolio investors offloaded equities worth Rs 1,328.31 crore in the capital market on Tuesday, provisional exchange data showed."