PremiumBonds are taking the brunt of central-bank calls for tougher action to curb inflation, which has risen to 40-year highs as the war on Ukraine spurs commodity prices. Equity markets appear to be responding to that message, and some investors are leaning into stocks as an inflation hedge.
Indian equities ended in the red on Wednesday, wiping out gains made earlier in the session. European share markets also dipped, as a selloff in bond markets showed tentative signs of easing, while investors continued to weigh risks from the war raging in Ukraine and record inflation prints.
Back home, Sensex fell 304.5 points to end the day at 57,684.8, while Nifty closed at 17,223.6, down 91.9 points from Tuesday. Losses were largely led by financials, IT, and auto stocks. Oil & gas and metal shares advanced.
Broader markets ended flat.
As Omicron cases have subsided, India is expected to see a recovery in hotel bookings, as per a report.
NSE-listed RateGain Travel Technologies, a software as a service provider for travel and hospitality firms, said the impact of travel demand in India’s two major cities Delhi and Mumbai as international travel resumes on 27 March will be positive. The company said it is expecting that India will see travel demand increase by 150% YoY in hubs like Delhi and Mumbai.
India saw a sharp surge in cases which ebbed within 4-5 weeks also saw February register 40% higher bookings than January and almost reaching the high of December. In January 2022, India saw a 40% decline in hotel bookings.
China says one of two black boxes from the China Eastern plane crash was found in severely damaged condition.
The recorder is so damaged that they are not able to tell whether it is the flight data recorder or the cockpit voice recorder.
European equities rose for the sixth day on Wednesday, extending their longest winning streak since November, as surging inflation and the ensuing selloff in bond markets continued to increase the appeal of stocks against fixed income investments.
Benchmarks edged up in Europe in early trading.
France's benchmark CAC 40 rose 0.1% in early trading to 6,667.05, while Germany's DAX gained 0.3% to 14,516.18. Britain's FTSE 100 rose 0.3% to 7,500.58. The futures for the Dow industrials and S&P 500 were 0.1% lower.
Investors were closely watching what might happen with President Joe Biden joining a NATO meeting and EU Summit Thursday in Europe, where sanctions and the Russian oil embargo will likely top the agenda.
Consumers in India have commenced spends on shopping, recreational and entertainment activities such as eating out and leisure travel, but remain wary of escalating prices, according to findings of a February consumer tracker by Deloitte Touche Tohmatsu India LLP (DTTILLP).
In its 28th analysis of consumer behaviour since the onset of the pandemic, the survey that tracks household attitudes towards essential and discretionary expenses revealed that Indian consumers are looking at spending 14% of their share of wallet on clothing and personal care over the next four weeks. Those surveyed said they plan to spend another 14% on recreation, entertainment and leisure travel, with 10% spends directed towards groceries and 9% on everyday household goods. 7% of those surveyed plan to save their earnings over the next four weeks.
Ukrainian President Volodymyr Zelenskiy will take part via video link in this week’s special NATO summit to discuss the Russian invasion, his spokesman said. Kyiv said the evacuation of civilians from the besieged southern port of Mariupol continued, but about 100,000 people remain there under bombardment.
U.S. President Joe Biden, who’s traveling to Europe for Thursday’s NATO meeting, said further sanctions on Russia will be announced during his trip. European Union members Germany and Hungary sought to put the brakes on a potential Russian oil embargo.
Indian private refiner Nayara Energy, part-owned by Russia's Rosneft, has purchased Russian oil after a gap of a year, buying about 1.8 million barrels of Urals from trader Trafigura, two trade sources said and Refinitiv data shows.
Indian companies are snapping up Russian oil as it is available at a deep discount after some companies and countries shunned purchases from Moscow due to sanctions against Moscow for its invasion of Ukraine.
Given the steady fall in daily fresh coronavirus cases, home ministry has decided to end all COVID-19 containment measures from 31 March, two years after their implementation following the outbreak of the pandemic.
However, wearing of face mask and maintaining social distancing norms will continue as earlier.
The Centre had on 24 March 2020 issued for the first time orders and guidelines under the Disaster Management Act, (DM Act) 2005, for the containment of COVID-19 in the country which were modified on various occasions.
Despite an increase in net sales realisations by 5%, OPBIDTA/MT declined 10% Y-o-Y in 9M FY2022 to ₹1,124/MT, primarily due to high input prices - raw material, power & fuel and freight expenses rose 12%, 31% and 5% Y-o-Y, respectively.
Elevated costs would push down OPBIDTA/MT 16-18% to Rs. 1030-1050/MT in FY22. Operating margins are expected to decline 440-480 bps Y-o-Y in FY22 to 19.8%-20.2%, said Anupama Reddy, Assistant Vice President & Sector Head, Corporate Ratings, Icra.
Mortgage lender HDFC Ltd on Wednesday said it has approved retail home loans of over ₹2 trillion so far this financial year.
Renu Sud Karnad, managing director, HDFC Ltd., said, in over four and half decades, she has not seen a better time for the housing sector than now due to lower interest rates, stable property prices, government’s thrust on affordable housing, improved affordability, among others.
Assets under management (AUM) of the Indian mutual fund industry declined to ₹37.5 trillion as of end of February from ₹trillion in January.
The AUM of equity funds in February 2022 declined ₹12.9 trillion ₹13.4 trillion at the end of January due to mark-to-market losses as equity markets saw declines. In last one year, equity AUM is up by 34%
Passive funds in the form of ETFs and index funds continue to gain traction. The AUM of index funds, which is largely dominated by retail investors, is now at ₹55,000 crore. ETF AUM ( ₹3.91 trillion) while still dominated by institutional investors, is gaining popularity among retail investors as well
February saw higher inflows at ₹19,700 crore, with ex-NFO inflow at record high at ₹17,800 crore. SIP flows stayed strong at ₹11,400 crore in February
Debt funds continued to witness outflows except liquid funds. Lower returns and concerns over rising yield have led to investors shying away from debt funds
Shared living operator Stanza Living has raised $57 million ( ₹425 crore) in debt financing led by Kotak Mahindra Bank and RBL Bank. Existing lender Alteria Capital also participated in the round.
The proceeds will be used to fund capital expenditure for Stanza Living’s current and future projects and accelerate its next phase of multi-city expansion. This debt infusion comes on the back of the $100 million equity funding raised by Stanza Living in 2021.
Stanza Living, which has more than 75,000 beds, offers shared accommodation for students and working professionals in 23 cities across the country. Till date, Stanza Living has raised close to $220 million in debt and equity.
The Income Tax department on Wednesday morning initiated a search operation on various premises of Hero MotorCorp. These premises include offices, residences of senior management including Chairman, Pawan Munjal, said IT officials declining to be named.
"The searches are underway in Delhi, Gurgaon and other locations in North India," the officials added.
Mint reached out to the company for an official response, but could not get one immediately.
The reason for these searches could not be ascertained immediately since the searches are still underway but one of the officials said the reason could be 'bogus expenses'.
Brent oil will likely hit $150 a barrel this year as the supply shock from the war in Europe coincides with resilient demand from people keen to travel after the virus, according to veteran commodities trader Doug King.
The world has few options to pump more crude, and there’s little sign that consumption is under threat, said King, who runs the $425 million Merchant Commodity Fund, which returned 28% in the first two months of this year.
“Jet fuel demand is going to come back, travel is going to come back," he said in an interview on Friday. “I think people have money. They’re going to go spend it, so I don’t see the demand destruction at these prices."
Oil was already elevated before Russia invaded Ukraine as supply struggled to keep up with the demand rebound from the pandemic. The ensuing financial penalties on the country, one of the biggest crude producers, and self-sanctioning by much of the industry saw Brent -- the global benchmark -- flirt with $140 a barrel in early March, although it’s now eased back to near $115.
Oil prices rose on Wednesday as a reported drop in U.S. crude inventories increased concerns about tight global supplies amid the hit to Russian exports from economic sanctions.
Brent crude futures climbed $1.77, or 1.53%, to $117.25 a barrel, after falling 14 cents in the previous session.
U.S. West Texas Intermediate (WTI) crude futures rose $1.51, or 1.38%, to $110.78 a barrel, after losing 36 cents on Tuesday.
The market remains on edge over the prospect of further sanctions on Russia, the world's second-largest crude exporter, after its invasion of Ukraine, actions that Moscow calls a "special operation".
Prices dipped on Tuesday as the European Union seems unlikely to agree to a ban on Russian oil. However, U.S. President Joe Biden is set to announce more sanctions on Russia when he meets with European leaders on Thursday in Brussels, including an emergency meeting of NATO.
Motilal Oswal Asset Management Co. Ltd on Tuesday said it has temporarily stopped existing investments including, systematic investment plan (SIP) and systematic transfer plan (STP), into its S&P 500 Index Fund, MSCI EAFE Top 100 Select Index Fund and Nasdaq 100 Fund of Fund from 1 April 2022.
The asset management company has taken the decision on account of limitation on industry-wise overseas investment exposure. (Read here)
Apple Inc's Apple Music, mobile App Store and Podcasts resumed services on Tuesday, after facing outages for a second consecutive day, according to the company's system status page.
Tuesday's outage also affected Mac App Store, users of Apple Card, Apple Books, iCloud Web Apps and Weather. The outage on Monday affected 11 of Apple's services, including Arcade and Maps.
It was not immediately clear what caused the outages on both days, but Bloomberg News reported on Monday that Apple told staff that the outage stemmed from domain name system, or DNS - an address book of the internet which enables computers to match website addresses with the correct server.
One97 Communications Ltd., parent of Paytm, on Wednesday said there was no information to be disclosed which may have a bearing on the price/volume of shares of the company. It added that business fundamentals remain robust.
BSE had sought clarification from One 97 Communications Ltd. on the steep fall in the company’s shares. On Tuesday, Paytm shares fell 3.8% to ₹543.90 on BSE. They are now down 75% from the issue price of ₹2,150 apiece.
For today's session, 17350 followed by 17500 are the levels to watch out for; whereas, on the flip side, 17150 – 17000 are to be considered as intraday supports. On Tuesday, market breadth was extremely positive in the latter half and the broader market did extremely well along with some heavyweights. Hence, traders are advised to remain sanguine and focus on individual stocks in order to identify better trading opportunities.
Novavax Inc said on Tuesday its COVID-19 vaccine has got emergency-use authorization from the Drugs Controller General of India for children aged 12 to 17 years.
The authorisation is a global first for the age group for the vaccine, which is manufactured and marketed in India by the Serum Institute of India under the brand name Covovax.
Hindustan Unilever Ltd’s (HUL’s) investors are nervous. The relentless rise in costs for fast moving consumer goods (FMCG) companies has come at a time when demand environment is sombre. Some companies are likely to be more hurt than others, and HUL’s relatively high exposure to raw materials such as palm oil, and crude oil and its derivatives makes it more vulnerable given the surge in prices following the war in Ukraine.
These concerns are reflected in the stock’s performance. HUL’s shares have declined 16% so far in CY22 vis-à-vis a 4% drop in the Nifty FMCG index. The stock is now trading at 40 times estimated FY24 earnings, according to Bloomberg data. Valuations have corrected meaningfully but the scope for significant near-term upsides appears capped. (Read here)
State-run fuel retailers raised petrol and diesel prices by 80 paise per litre on Tuesday, the first increase since daily revisions were paused on 4 November before crucial assembly elections. Executives of the fuel retailers said more such hikes are likely as Brent crude prices have surged more than 40% since November.
In the national capital, diesel and petrol were sold at ₹87.47 per litre and ₹96.21 per litre, respectively, on Tuesday. The retailers also raised the prices of non-subsidized cooking gas cylinders by ₹50 after a gap of over five months. This is the first hike since 6 October last year. (Read here)
Nifty bounced back sharply after a small downward correction. The overall chart pattern indicate next upside of around 17,500 for NSE Nifty in the short term and one may expect further upside targets of around 17,800 to 18,000 levels in the near term.
Similar to Monday’s session, we had a soft opening on Tuesday as indicated by the SGX Nifty. In the initial hours, the weakness extended as we witnessed some decent correction in the financial space. As a result, Nifty gradually approached its psychological level of 17000 in the first half. However, all of a sudden the buying re-emerged from nowhere and within a blink of an eye, markets were off significantly from day’s low. The buying momentum accelerated towards the fag end to not only erased all losses but also to close above 17300 with more than a percent gains.
During the first half of Tuesday, we witnessed extension of Monday's profit booking mode but as we approached the sacrosanct support of 17000 – 16900, the bulls got activated all of a sudden. Since there was no unfavorable trigger on the domestic as well as global front, the bulls grabbed this opportunity with both hands. Initially, Reliance and IT pack was providing some helping hand and banking was sulking; but the moment market reversed, the banks came back in the driver’s seat to lift the overall sentiments of the market participants. With reference to our previous commentary, we were pretty clear that this is just a profit booking phase and the buying is likely to attract around 17000 – 16900. Markets perfectly moved as per the script and has now closed at an interesting juncture. For the coming session, 17350 followed by 17500 are the levels to watch out for; whereas on the flipside, 17150 – 17000 are to be considered as intraday supports.
On Tuesday, market breadth was extremely positive in the latter half and broader market did extremely well along with some heavyweights. Hence, traders are advised to remain sanguine and focus on individual stocks in order to identify better trading opportunities.
Oil marketing companies raised pump prices of petrol and diesel prices for the second consecutive day on Wednesday by 80 paise a litre each.
Petrol in Delhi will now cost ₹97.01 per litre as against ₹96.21 earlier, while diesel will sell for ₹88.27, up from ₹87.47.
A record 137-day hiatus in rate revision ended on 22 Marchwith an 80 paise per litre increase in rates. Prices had been on a freeze since 4 November ahead of the assembly elections in states like Uttar Pradesh and Punjab - a period during which the cost of crude oil soared by $30 per barrel.
Oil prices turned higher on Wednesday, erasing losses from the previous session, after industry data showed U.S. crude stocks fell last week, underlining how tight global supplies are amid the hit to Russian output from economic sanctions on Moscow.
Brent crude futures climbed $1.06, or 0.9%, to $116.54 a barrel, after falling 14 cents in the previous session.
U.S. West Texas Intermediate (WTI) crude futures rose 87 cents, or 0.8%, to $110.14 a barrel, after losing 36 cents on Tuesday.
Nifty futures on the Singapore Exchange traded 69 points higher at 17,441, hinting at a higher start for Indian benchmarks.
Asian equity markets gained on Wednesday as investors expanded their search for hedges as bonds extended steep losses on the Federal Reserve’s strengthened resolve to clamp down on inflation.
An MSCI Inc. gauge of Asia Pacific shares rose for a second day, led by Japan. U.S. contracts fluctuated after the S&P 500 advanced for the fifth session in six. The index has now recovered halfway from the rout that started in January. Treasuries added to losses triggered Monday by signals from Federal Reserve Chair Jerome Powell that a half-point interest-rate hike is possible at the central bank’s next meeting.
S&P 500 futures were steady and Nasdaq 100 futures were little changed.
Topix index added 1.9%, Australia’s S&P/ASX 200 Index gained 0.4%, Kospi index added 0.7%, Hang Seng Index rose 0.5%, and Shanghai Composite Index fell 0.2%
US stocks ended higher on Tuesday, led by a 2% gain in the Nasdaq, as shares of technology and other big growth names rebounded from recent losses and Nike rose after it reported upbeat results. The Dow Jones Industrial Average rose 254.47 points, or 0.74%, to 34,807.46, the S&P 500 gained 50.43 points, or 1.13%, to 4,511.61 and the Nasdaq Composite added 270.36 points, or 1.95%, to 14,108.82.
Never miss a story! Stay connected and informed with Mint. Download our App Now!!