BQuick On June 19: Top 10 Stories In Under 10 Minutes   

Here is a roundup of the day’s top stories in brief.

1. China Standoff: Modi Gets Opposition Leaders' Backing

Opposition leaders from across the political spectrum pledged their support to the Indian government amid the geopolitical tensions with China.

• Leaders of at least 20 political parties attended an all-party meet called by Prime Minister Narendra Modi to discuss the ongoing China conflict.
• Congress chief Sonia Gandhi said her party is ready to make any sacrifice to ensure that India's defence forces are battle-ready. She called for the government to brief opposition parties regularly about the situation.
• West Bengal Chief Minister Mamata Banerjee pledged her party's support and said that China should not be allowed to venture in the country's telecom, railway and aviation sectors at any cost.
• Bihar Chief Minister Nitish Kumar said that parties should shed differences right now as any visible disunity could be exploited.
• Maharashtra Chief Minister Uddhav Thackeray said that India wants peace but that should not be misconstrued as a sign of weakness.

Follow updates from the all-party meeting here.

2. Can India Convert Anti-China Fury Into An Economic Revolution?

Unless Prime Minister Modi can craft India’s escape velocity to near-economic-parity with China, our desire to ‘get even’ will remain a Bollywood dialogue, writes Raghav Bahl.

• Can India ever create an honourable power equation with China?
• Yes, we can, provided we completely, totally, unabashedly reinvent the Indian state, beginning with its psychological and structural transformation.
• It must give up its profiteering, commercial mindset to focus all its might on engineering a social revolution.
• Ironically, this is the moment to get inspired by Deng Xiaoping, who blasted the Chinese economy into an ‘escape velocity’ that took it to another orbit.

Here’s how to do all that.

3. RIL’s Rs 11-Lakh-Crore Milestone

Billionaire Mukesh Ambani’s flagship Reliance Industries Ltd. became the first Indian company with a market value of Rs 11 lakh crore as investors rejoiced fundraising that will make it debt-free.

• Shares of Reliance Industries rallied over 6% on Friday to Rs 1,759 apiece—an all-time high.
• The company said it became net-debt free after completing a slew of deals starting with Facebook Inc., and including the likes of KKR & Co.
• The stock has surged 17.3% so far this year, while the benchmark NSE Nifty 50 has fallen 15.8% during the same period.
• At close, Reliance Industries’ market capitalisation stood at Rs 11.15 lakh crore, making it India’s most valuable company by a wide margin.

Take a look at RIL’s market cap journey.

4. Sensex Caps Weekly Gain, WTI Crude Back Above $40

Indian stocks rose Friday, extending their gains for the week, as Reliance Industries Ltd. lifted the benchmark index and border tensions with China eased.

• The S&P BSE Sensex added 1.5% to 34,731.73 after swinging between gains and losses at least five times.
• The measure completed a weekly advance of 2.8%.
• The yield on the most-traded 6.45% 2029 bond was little changed at 5.98%, while the rupee weakened 0.1% to 76.2112 per U.S. dollar.

Follow the day’s market action here.

Enam Holdings Investment Director Sridhar Sivaram, who expects a “a lot of volatility” in the Indian markets, is advising investors to “stay completely away from non-bank lenders and housing financiers.”

Here are the sectors where Sivaram sees opportunities.

Stocks rose across most major global markets as investors cheered the latest breakthrough in trade negotiations between America and China and the start of stimulus talks in Europe.

• The benchmark S&P 500 rose for a second day as reports that China plans to accelerate purchases of American farm goods to comply with the phase one trade deal boosted risk appetite.
• Still, with uncertainty over how quickly economies can emerge from lockdowns, and a welter of options set to expire in a quarterly event know as quadruple witching, investors are bracing for potential bouts of volatility.
• West Texas Intermediate crude gained 3.7% to $40.27 a barrel, the highest in 15 weeks.

Get your daily fix of global markets here.

5. Government Sets The Ball Rolling On LIC IPO

India is seeking advisers to help Life Insurance Corp. prepare for an initial share sale.

• The advisers will help evaluate the capital structure of India’s biggest insurer as well as aid the company in reworking its financial statement, according to a tender document on the government’s website.
• Changes to a law and a buy-in from employees’ unions are some of the preparatory work needed for selling a stake in LIC.

Potential advisers have to bid by July 13.

6. Fuel Prices: 13th Straight Hike

Retail fuel prices in India were hiked for the thirteenth day in a row, burning a deeper hole in the pockets of consumers who are already struggling with coronavirus-related economic disruptions.

• Petrol price on Friday was hiked by 56 paise per litre and diesel by 63 paise a litre, taking the cumulative increase in rates to Rs 7.11 and Rs 7.67 per litre respectively in less than two weeks.
• Petrol price in Delhi was hiked to Rs 78.37 per litre from Rs 77.81, while diesel rates were increased to Rs 77.06 a litre from Rs 76.43, according to a price notification of state oil marketing companies.
• Rates have been increased across the country and vary from state to state depending on the incidence of local sales tax or VAT.

Oil companies ended an 82-day hiatus in rate revision on June 7.

7. Cushioning Supply Chains From Virus Pain

As economic activity in India collapsed after the nation’s punishing curbs to contain the pandemic, makers of consumer goods and automobiles stepped up to protect supply chains. From offering payments in advance and faster clearance of dues to health cover to stop workers from leaving, they tried to cushion vendors and distributors.

• “Vendors were struggling with people leaving, so we supported them by ensuring timely payment so that they can retain their people,” Steffen Knapp, director of Volkswagen Passenger Cars India, told BloombergQuint over the phone.
• “We are also providing liquidity by paying out much faster than before.”
• Maruti Suzuki India Ltd., India’s largest carmaker, provided help worth Rs 1,200 crore in interest support, incentives and a reserve fund to assist dealers, according to Shashank Srivastava, executive director of sales and marketing at India’s largest carmaker.

Here’s what other automakers and consumer goods firms did.

Related Coverage

8. Hindalco’s Exports Pivot

Hindalco Industries Ltd. plans to sell about two-thirds of its output overseas this year as local demand gets hit by the coronavirus pandemic.

• Exports during the year that started April will increase to as much as 65% of total output compared with 50% last year, Managing Director Satish Pai said, adding the company expects to sell 75% to 80% of its total metal output to overseas customers in the April-June quarter.
• India’s demand in the past few months was decimated by the world’s biggest lockdown that was imposed in March.

Hindalco has exported around 80%-90% of its output in the last two months.

9. Urijit Patel’s New Role

Former Reserve Bank of India Governor Urjit Patel will take charge as chairman of the National Institute of Public Finance and Policy.

• "National Institute of Public Finance and Policy is privileged to have Dr. Urjit Patel, former Reserve Bank Governor, as its Chairperson for a four-year term commencing June 22, 2020," the economic think tank said in a statement on Friday.
• Patel will replace Vijay Kelkar, who assumed office on Nov. 1, 2014.

Patel had abruptly announced his resignation as RBI governor in December 2018.

10. Coronavirus: India Reports Over 13,500 New Cases

The Covid-19 infection rate in India shows no signs of abating as the world’s fourth-worst affected nation reported the biggest single-day spike in cases on Friday.

• India added over 13,500 new cases in 24 hours, taking the total tally to 3,80,532 in Asia’s third-largest economy, according to Health Ministry’s update on June 19.
• India reported 336 deaths and 10,386 recoveries in the same period.

Follow the latest updates here.

Globally, cases topped 84 lakh, while deaths exceeded 4.54 lakh.

• The U.K. lowered its alert level by one rank to Level 3, reflecting the fact the coronavirus is no longer spreading exponentially in the community after almost three months of lockdown.
• China’s capital shouldn’t loosen restrictions even though it probably saw a peak in cases, top virus expert Wu Zunyou said.
• GlaxoSmithKline Plc’s Covid-19 vaccine partnership with Clover Biopharmaceuticals started tests on humans.

Follow the global virus tracker.