STATE OF THE MARKETS
SGX Nifty signals negative start
Nifty futures on the Singapore Exchange traded 78 points, or 0.54 per cent, lower at 14,478.50, in signs that Dalal Street was headed for a negative on Wednesday.
Tech view: Nifty forms bullish candle
Nifty50 on Tuesday formed a strong bullish candle on the daily scale and negated the formation of lower highs. The index topped the 14,500 level comfortably, with analysts now projecting that a level above 14,560 level can open up the doors for more gains towards the 14,650-14,800 range. They said the index range has shifted higher to 14,200-14,600 zone. This is where Nifty can consolidate over the next few sessions.
Asian shares mixed in early trade
US Treasury Secretary nominee Janet Yellen’s push for a sizable fiscal relief package in response to the Covid-19 pandemic could not lift Asian markets that fell despite overnight rise on US indices. Australia’s ASX 200 rose more than 0.5 per cent in early trade Wednesday. Japan’s Nikkei225 fell 0.37 per cent, but Hong Kong’s Hang Seng index added 0.68 per cent.
US stocks settled higher
Wall Street’s main indices rose as US Treasury Secretary nominee Janet Yellen advocated for a hefty fiscal relief package before lawmakers to help the world’s largest economy ride out a pandemic-driven slump. The Dow Jones Industrial Average rose 116.26 points, or 0.38 per cent, to 30,930.52, the S&P500 index gained 30.66 points, or 0.81 per cent, to 3,798.91 and the Nasdaq Composite index added 198.68 points, or 1.53 per cent, to 13,197.18.
Bajaj duo, Bajaj Finserv to disclose Q3 results
Bajaj duo, Bajaj Finserv, Hind Zinc, HDFC AMC, Havells India, L&T Technology, Syngene International, Sundaram Finance, Sterlite Technologies, VST Industries and GMM Pfaudler are some of the companies which will disclose their December quarter earnings during the day.
Indigo Paints IPO to open today
Ahead of its IPO, Sequoia Capital-backed Indigo Paints said it has mopped up Rs 348 crore from anchor investors. A total of 23,35,020 shares have been allotted to 25 anchor investors at Rs 1,490 apiece, which is the upper end of the price band, the company said in a statement.
IRFC IPO subscribed 1.22x on Day 2
The initial public offer of Indian Railway Finance Corporation was subscribed 1.22 times on the second day of subscription on Tuesday. The offer received bids for 1,52,64,04,775 shares against 1,24,75,05,993 shares on offer, as per the data available with NSE. The category reserved for non institutional investors was subscribed 24 per cent and retail individual investors (RIIs) 2.33 times.
FPIs buy Rs 258 crore worth stocks
Net-net, foreign portfolio investors (FPIs) were buyers of domestic stocks to the tune of Rs 257.55 crore, data available with NSE suggested. DIIs were net sellers to the tune of Rs 199.30 crore, data suggests.
Crude oil extends gains
Oil extended gains in Asia on expectations US President-elect Joe Biden’s incoming administration will take steps to revive growth and energy demand in the world’s largest economy. WTI contracts for February delivery, which expire Wednesday, rose 0.3% to $53.12 a barrel. Brent for March settlement climbed 0.3% to $56.04
MONEY MARKETS
Rupee: The rupee gained 11 paise to settle at 73.17 against the US dollar on Tuesday on the back of rally in domestic equities and weak American currency. A rebound in regional currencies amid growing risk appetite among investors also supported the local currency.
10-year bonds: India 10-year bond yield declined 0.35 per cent to 5.93 after trading in 5.93-5.96 range.
Call rates: The overnight call money rate weighted average stood at 3.16 per cent, according to RBI data. It moved in a range of 1.9-3.5 per cent.
MACROS
Too big to fail banks… RBI on Tuesday said state-owned SBI, along with private sector lenders ICICI Bank and HDFC Bank continue to be domestic systemically important banks (D-SIBs) or institutions which are “too big to fail”. SIBs are subjected to higher levels of supervision so as to prevent disruption in financial services in the event of any failure. RBI had issued the framework for dealing with D-SIBs in July 2014.
Rs 25k cr recap for PSBs?… The government may set aside about Rs 25,000 crore in the FY22 budget for providing capital to state-run banks, people aware of deliberations told ET. The finance ministry has sought details from lenders on capital requirements, estimated bad loans and plans to raise funds. The final capitalisation amount will be decided after these discussions.
Govt talks tough on WhatsApp… The ministry of electronics and information technology (MeitY) has asked instant messaging app WhatsApp to immediately “withdraw” the proposed changes to its privacy norms, top officials told ET. In a letter sent on Monday to WhatsApp’s global head Will Cathcart, MeitY said, “The proposed changes raise grave concerns regarding the implications for the choice and autonomy of Indian citizens. Therefore, you are called upon to withdraw the proposed changes”, marking a significant setback for the American company that has a 400 millionstrong user base in India.
India may tighten FDI in e-commerce… India is likely to tighten the foreign direct investment (FDI) rules for e-commerce to check companies set up by the online marketplaces from trading on their own platform. The Department for Promotion of Industry and Internal Trade (DPIIT) may issue a clarification through a Press Note, expressly prohibiting e-commerce platforms from holding stake in a seller, directly or indirectly
New rule for AIFs in the works… Foreign investors serving on the investment committees of private equity funds face uncertainty as it is not clear whether such appointments will be construed as ‘control’ under the non-debt instrument rules. Multiple people with direct knowledge of the matter told ET that if regulators link such appointments to control, several AIFs will effectively become foreign entities, causing downstream investment rules to apply. On the flipside, if large investors are not given a position in the investment committees, they may choose not to make investments through that specific fund.
Index funds gaining traction… Passive index funds tracking the broadest indices are gaining an edge over active stock pickers. Data from mutual fund industry body AMFI show that the number of folios in index funds doubled from 4.05 lakh to 8.11 lakh in the last 13 months. During the same period, assets under management of index funds surged 95% to Rs 14,794 crore. By contrast, the total AUM of the mutual fund industry moved up 15% — from Rs 26.94 lakh crore to Rs 30.96 lakh crore.
