The weakness that hit stocks yesterday continued to prevail today with the benchmark indices suffering modest losses.
Join us as we follow the top business news through the day.
All transactions fully protected under RBI, NPCI guidelines: Google Pay
Google Pay on Wednesday said all transactions made through its platform are fully protected by redressal processes laid out in the guidelines issued by the Reserve Bank of India and the National Payments Corporation of India.
The statement comes against the backdrop of social media buzz that issues that might arise while transferring money through Google Pay cannot be redressed under law as the app is unauthorised.
“Some quotes on social media, wrongly attributed to the RBI, claim that issues arising while transferring money through Google Pay are not protected by the law, since the app is unauthorised. This is incorrect and can be verified on NPCI’s website,” a Google spokesperson said.
Coronavirus is the new trade war
Photo finish: end of an era as Olympus sells camera division
It's the end of an era: Japan's Olympus said Wednesday it is selling its struggling camera division to focus on medical equipment — now the major portion of the storied firm's business.
Olympus has been in the camera business since 1936, when it launched a product using the "Zuiko" lens, but it has struggled along with industry rivals as demand for traditional cameras declines, with consumers relying on increasingly sophisticated smartphone cameras.
The company said it has signed a memo of understanding to transfer its camera business to investment fund Japan Industrial Partners, with the goal of sealing a final deal by the end of September.
Oil dives over 5% as U.S. crude stocks hit record, COVID cases mount
Could oil prices soon be facing a deja vu moment?
Reuters reports: "Oil prices tumbled over 5%, or more than $2 a barrel on Wednesday, after U.S. crude storage hit another record and coronavirus cases rebounded in countries like Germany and surged in heavily populated areas of the United States.
The United States had its second-largest rise in infections since the pandemic began. Mounting infections there as well as in China, Latin America and India have unnerved investors and pressured oil prices.
“The market is signalling that if it doesn't get constant reassurance that we are emerging from the breakdown in demand that happened because of the pandemic, then higher oil prices really don't make sense,” said Gene McGillian, vice president of market research at Tradition Energy in Stamford, Connecticut.
Brent crude settled at $40.31 a barrel, down $2.32, or 5.4%. On Tuesday, Brent hit its highest price since early March, just before the pandemic and Saudi-Russia price war roiled markets.
U.S. West Texas Intermediate (WTI) crude settled at $38.01 a barrel, losing $2.36, or 5.8%.
A stronger U.S. dollar, which moves inversely with oil, and a slump in equities also weighed on prices.
U.S. crude oil inventories swelled last week by 1.4 million barrels, exceeding expectations for a 299,000-barrel rise, the Energy Information Administration said.
That marked the third straight record for crude in U.S. storage.
The International Monetary Fund said the pandemic is causing wider and deeper economic damage than first thought, and it slashed its 2020 global output forecasts further.
India's oil imports in May hit the lowest since October 2011 as refiners with brimming crude inventories cut purchases.
China, the world's top crude importer, is also expected to slow imports in the third quarter, after record purchases in recent months."
Rupee slips 4 paise to 75.76 against US dollar in early trade
The initial weakness in domestic equities weighed on the rupee this morning.
PTI reports: "The rupee depreciated 4 paise to 75.76 against the US dollar in early trade on Thursday as weak domestic equities coupled with strong US dollar and rising coronavirus cases weighed on investor sentiments.
Forex traders said investor sentiment weakened after the US threatened new tariffs on European imports amid escalating trade war fears. Besides, border tension with China and rising COVID-19 cases dragged down the local unit.
The rupee opened at 75.76 against the US dollar, down 4 paise over its previous close.
It had settled at 75.72 against the greenback on Wednesday.
“The risk sentiment was soured as US trade representative has proposed imposing tariffs on USD 3.1 billion of imports from France, Germany, Spain and the UK. The proposal has been put out to seek public opinion until July 26,” said Abhishek Goenka, Founder and CEO, IFA Global.
Besides, the IMF has cut its projections for world economic growth. It now sees an even deeper recession and slower recovery than earlier, Goenka added.
Meanwhile, the dollar index, which gauges the greenback’s strength against a basket of six currencies, rose 0.13 per cent to 97.27.
The 30-share BSE benchmark Sensex was trading 144.68 points lower at 34,724.30 and broader NSE Nifty fell 27.60 points to 10,277.70.
Foreign institutional investors were net buyers in the capital market as they bought shares worth Rs 1,766.90 crore on Wednesday, according to provisional exchange data."
Diesel crosses Rs 80-mark in Delhi after 19th consecutive price hike
It looks like consumers will continue to face the heat of rising domestic fuel prices.
PTI reports: "Diesel price in the national capital crossed the Rs 80 per litre-mark for the first time ever on Thursday as oil companies raised prices for the 19th day, taking the cumulative rate to Rs 10.63 a litre.
Petrol price, after a day’s hiatus, was hiked by 16 paise and the increase in less than three weeks now totals Rs 8.66 per litre.
Petrol price in Delhi was hiked to Rs 79.92 per litre from Rs 79.76, while diesel rates were increased to Rs 80.02 a litre from Rs 79.88, according to a price notification of state oil marketing companies.
Diesel had for the first time become costlier than petrol in Delhi on Wednesday and has now crossed the Rs 80 per litre-mark.
Rates differ from state to state depending on the incidence of value-added tax (VAT).
However, diesel is costlier than petrol only in the national capital where the state government had raised local sales tax or VAT on the fuel sharply last month. It costs less than petrol in other cities.
The 19th daily increase in rates since oil companies on June 7 restarted revising prices in line with costs after ending an 82-day hiatus in rate revision, has taken diesel prices to fresh highs.
In 19 straight days, diesel price has gone up by Rs 10.63 per litre. Petrol price has been hiked on 18 occasions since June 7 and now totals to Rs 8.66 a litre."
IMF projects sharp contraction of 4.5% in Indian economy in 2020
The IMF on June 24 projected a sharp contraction of 4.5% for the Indian economy in 2020, a “historic low,” citing the unprecedented coronavirus pandemic that has nearly stalled all economic activities, but said the country is expected to bounce back in 2021 with a robust 6% growth rate.
The International Monetary Fund (IMF) projected the global growth at -4.9% in 2020, 1.9 percentage points below the April 2020 World Economic Outlook (WEO) forecast.
“We are projecting a sharp contraction in 2020 of -4.5%. Given the unprecedented nature of this crisis, as is the case for almost all countries, this projected contraction is a historic low, Indian-American Gita Gopinath, IMF’s Chief Economist, told PTI as she released the World Economic Outlook Update in Washington.
Sensex falls over 300 points in early trade ahead of F&O expiry
The benchmark indices that ended their four-day winning streak yesterday are showing more weakness this morning.
PTI reports: "Equity benchmark Sensex tumbled over 300 points in early trade on Thursday tracking losses in index-heavyweights HDFC twins, Infosys and ICICI Bank ahead of the expiry of June derivatives.
Weak cues from global markets also weighed on investor sentiment here, traders said.
After touching a low of 34,499.78, the 30-share index was trading 343.59 points, or 0.99 per cent, lower at 34,525.39.
Similarly, NSE Nifty fell 99.10 points, or 0.96 per cent, to 10,206.20.
Infosys was the top loser in the Sensex pack, shedding around 3 per cent, followed by HDFC Bank, Axis Bank, IndusInd Bank, Asian Paints, ICICI Bank and HDFC.
On the other hand, Bajaj Auto, ITC, NTPC, UltraTech Cement and Reliance Industries were among the gainers.
In the previous session, the BSE barometer closed at 34,868.98, down 561.45 points, or 1.58 per cent, and the broader Nifty tumbled 165.70 points, or 1.58 per cent, to end at 10,305.30.
On a net basis, foreign institutional investors bought equities worth Rs 1,766.90 crore on Wednesday, provisional exchange data showed.
According to traders, expiry of June futures and options (F&O) contracts and border tension with China has added volatility to the market."
Trump’s H-1B policy detrimental to U.S. economy: USIBC
The temporary suspension of H-1B and other non-immigrant visas by President Donald Trump along with other restrictive policies on immigration is detrimental to the United States and its economy, president of a top American business advocacy group has said.
It (the proclamation) is unfortunate, Nisha Desai Biswal, president of U.S. India Business Council (USIBC) told PTI in an interview.
Mr. Trump had earlier this week issued a proclamation to suspend issuing of H-1B visas, popular among Indian IT professionals, along with other foreign work visas for the rest of the year.
Gold eases off multi-year peak as virus surge drives cash hunt
A temporary blip in gold's rise as investors rush to cash amid the stock sell-off.
Reuters reports: "Gold edged lower on Thursday, easing off a near eight-year high hit in the last session, as a selloff in equity markets driven by a surge in coronavirus cases prompted some investors to dump assets.
Spot gold was down 0.1% at $1,760.39 per ounce as of 0307 GMT, having soared to its highest level since October 2012 of $1,779.06 on Wednesday. U.S. gold futures fell 0.2% to $1,771.80.
“The behavioural pattern we've seen this year is that when stocks and energy fall, there is a rush for cash across all asset classes, including gold,” said Jeffrey Halley, senior market analyst at OANDA. However, he added, “any short-term correction is likely to be a slow grind lower, and not a rush for the exit doors,” as safe haven buying and low interest rates provide support for bullion.
Indicative of gold's overall appeal, which has driven a 16% jump in prices this year, holdings of the world's biggest gold-backed exchanged traded fund, the SPDR Gold Trust , hit their highest in over seven years.
Asian stock markets fell on surging U.S. coronavirus cases and an International Monetary Fund downgrade to economic projections, driving inflows into alternate safe haven dollar. Gold has, on occasion, moved in tandem with equity markets this year, with steep selloffs driving a rush for cash and as traders met margin calls."