October 3, 2022

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Business Live: Stocks drop; Vietnam buys Indian rice for first time in decades

7 min read

The Nifty and the Sensex opened the day on a  negative note, witnessing a modest correction in line with global stocks overnight after yesterday’s rally.

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

11:30 AM

M-cap of BSE-listed companies zooms to record high of over Rs 191 lakh crore

The bull run in stocks breaks new records.

PTI reports: “Total market capitalisation of all listed companies on the BSE has zoomed to a record high of over Rs 191 lakh crore.

Till Monday’s trade, markets recorded their ninth straight session of gain.

During this time, the BSE Sensex jumped 2,622.84 points or 5.75 per cent and closed above the 48,000-mark for the first time on Monday.

In the past nine trading sessions, the market capitalisation of BSE-listed firms have jumped a whopping Rs 12,89,863.39 crore to a record Rs 1,91,69,186.44 crore (USD 2.6 trillon).

Approval of two COVID-19 vaccines has brought cheers to the domestic market.

Also, positive global cues favoured the market sentiment.

In early Tuesday trade, the market capitalisation of BSE-listed companies was at Rs 1,91,25,467.48 crore.

Reliance Industries Limited is the country’s most valuable firm with a market valuation of Rs 12,49,218.49 crore, followed by Tata Consultancy Services (Rs 11,50,105.91 crore).

In a memorable year 2020, the Sensex gained 15.7 per cent where the benchmark index witnessed both ruthless selling and massive buying.

Equity investors grew richer by Rs 32.49 lakh crore in 2020 helped by massive returns in the equity market which had a roller coaster ride during the year hit by the coronavirus pandemic.”

11:00 AM

HDFC’s individual loan disbursements rise 26{9e6a73ef7eb6fa22b1de79554ca535a2a0aaa70d898e937e26eb250763832f63} in Dec quarter

Signs of a revival of the credit cycle.

PTI reports: “Mortgage firm HDFC Ltd on Monday said its disbursements in the individual loan category have grown by 26 per cent during the third quarter ended December 2020.

The individual loan business continued to see improvements during the December quarter, HDFC Ltd said in a regulatory filing.  “Disbursement growth over the corresponding quarter of the previous year was 26 per cent. For the nine months ended December 31, 2020, individual loan disbursements stood at 86 per cent of the levels in the corresponding period of the previous year,” it said.

During the quarter ended December 31, 2020, the profit on sale of investments was Rs 157 crore, it said, adding this was on account of the sale of 25,48,750 equity shares of HDFC Life Insurance Company Limited (HDFC Life).  HDFC’s shareholding in HDFC Life now stands at 49.99 per cent. This has met the RBI’s mandate of reducing its shareholding in HDFC Life to 50 per cent or below by December 16, 2020, it added.”

10:40 AM

Rupee slips 13 paise to 73.15 against US dollar in early trade

The rupee continues to mirror stocks in the new year too.

PTI reports: “The rupee depreciated by 13 paise to 73.15 against the US dollar in opening trade on Tuesday tracking the muted opening in domestic equities.

At the interbank forex market, the domestic unit was trading in a narrow range. It opened at 73.02 against the US dollar and fell to 73.15 against the greenback, registering a fall of 13 paise over its previous close.

On Monday, the rupee appreciated by 9 paise to close at a four-month high of 73.02 against the US dollar.

“Uncertainty surrounding Georgia run-offs and rising COVID-19 infections could push investors towards the safe haven appeal of the US dollar and cap gains for the domestic unit,” Reliance Securities said in a research note.

Most Asian currencies were flat against the greenback this Tuesday morning, it added.

The UK has issued stay-at-home orders for citizens as it goes into a lockdown which is expected to last until mid-February. The Sterling fell about 150 pips overnight from close to 1.37, said Abhishek Goenka, Founder and CEO, IFA Global.

Meanwhile, the dollar index, which gauges the greenback’s strength against a basket of six currencies, fell 0.12 per cent to 89.76.

Traders said market participants remained cautious ahead of the outcome over the runoff elections in Georgia that will determine control of the US Senate.

In addition, traders will be eyeing the minutes of the December Federal Reserve meeting, the US ISM manufacturing and non-manufacturing data and the US monthly jobs report.

On the domestic equity market front, the 30-share BSE benchmark Sensex was trading 174.91 points lower at 48,001.89, and the broader NSE Nifty was down 61.30 points at 14,071.60.

Foreign institutional investors were net buyers in the capital market as they purchased shares worth Rs 1,843.22 crore on a net basis on Monday, according to provisional exchange data.

Brent crude futures, the global oil benchmark, fell 0.18 per cent to USD 51.00 per barrel.”

10:20 AM

ICRA maintains negative outlook on aviation sector

Indian carriers will continue to have a poor balance sheet in FY22 despite a likely year-on-year growth of 78{9e6a73ef7eb6fa22b1de79554ca535a2a0aaa70d898e937e26eb250763832f63} in domestic air passenger traffic and 164{9e6a73ef7eb6fa22b1de79554ca535a2a0aaa70d898e937e26eb250763832f63} growth in international traffic, ICRA said in a report.

“If a vaccine is launched earlier [before H2 CY2021] with reasonable availability, domestic air passenger traffic could witness a further upside in FY2022, with an estimated growth of 93{9e6a73ef7eb6fa22b1de79554ca535a2a0aaa70d898e937e26eb250763832f63}, and international air passenger traffic could witness an estimated growth of 235{9e6a73ef7eb6fa22b1de79554ca535a2a0aaa70d898e937e26eb250763832f63},” ICRA said.

“With an improvement in passenger traffic in FY2022, ICRA expects the Indian aviation industry to report a y-o-y growth of 57{9e6a73ef7eb6fa22b1de79554ca535a2a0aaa70d898e937e26eb250763832f63} in revenues, with the industry’s net loss reducing to ₹146 billion from an estimated net loss of ₹210 billion in FY2021,” Kinjal Shah, vice-president, ICRA Ltd., said.

“The debt levels will remain high for the industry and are estimated to be range bound at around ₹500 billion [excluding lease liabilities] in FY2021 and FY2022, with the industry requiring an additional funding of ₹350-370 billion over FY2021 to FY2023,” she said.

 

10:00 AM

Sensex drops over 100 points; Nifty slips below 14,100

A correction after yesterday’s rally.

PTI reports: “Equity benchmark Sensex dropped over 100 points in opening trade on Tuesday, tracking losses in index majors Reliance Industries, ICICI Bank and Kotak Bank amid weak trend in global equities.

The 30-share BSE index was trading 112.74 points or 0.23 per cent lower at 48,064.06, and the broader NSE Nifty fell 38.25 points or 0.27 per cent to 14,094.65.

ONGC was the top laggard in the Sensex pack, shedding around 2 per cent, followed by M&M, NTPC, Bajaj Auto, Kotak Bank, ICICI Bank and Reliance Industries.

On the other hand, Axis Bank, HDFC, TCS and HUL were among the gainers.

In the previous session, Sensex ended 307.82 points or 0.64 per cent higher at 48,176.80, and Nifty jumped 114.40 points or 0.82 per cent to its fresh lifetime high of 14,132.90.

Foreign portfolio investors (FPIs) were net buyers in the capital market as they purchased shares worth Rs 1,843.22 crore on a net basis on Monday, according to provisional exchange data.

According to Binod Modi Head-Strategy at Reliance Securities, domestic equities are not looking inspiring at the moment with Asian bourses trading lower taking cues from US markets.

“US equities fell sharply mainly led by mounting concerns over potential rise in borrowing costs after the 10-Year Treasury break-even rate rose over 2 per cent yesterday and rise in COVID-19 cases along with resultant lockdowns.

“Fresh lockdown announced in Britain until at least mid-February weighed on investors’ sentiment. All eyes would be on Georgia’s run-off elections, in which two Senate seats have the potential to create fresh volatility in the markets,” he said.

Elsewhere in Asia, bourses in Shanghai, Tokyo and Hong Kong were trading on a negative note in mid-session deals, while Seoul was in the positive terrain.

Meanwhile, the global oil benchmark, Brent crude, was trading 0.14 per cent lower at USD 51.02 per barrel.”

9:30 AM

Vietnam buys Indian rice for first time in decades

Vietnam, the world’s thirdbiggest exporter of rice, has started buying the grain from rival India for the first time in decades after local prices jumped to their highest in nine years amid limited domestic supplies, four industry officials told Reuters.

The purchases underscore tightening supplies in Asia, which could lift rice prices in 2021 and even force traditional buyers of rice from Thailand and Vietnam to switch to India — the world’s biggest exporter of the grain. Indian traders have contracted to export 70,000 tonnes of 100{9e6a73ef7eb6fa22b1de79554ca535a2a0aaa70d898e937e26eb250763832f63} broken rice for January and February shipments at about $310 per tonne on a free-on-board basis, the industry officials said. “For the first time we are exporting to Vietnam,” B.V. Krishna Rao, president, Rice Exporters Association, told Reuters.

“Indian prices are very attractive. The huge price difference is making exports possible.” Vietnam’s 5{9e6a73ef7eb6fa22b1de79554ca535a2a0aaa70d898e937e26eb250763832f63} broken rice is offered at about $500-$505 per tonne, compared to Indian prices of $381-$387. Dwindling supplies and continued Philippine buying lifted Vietnamese rice export prices to a fresh nine-year high.