– No GST on back-office sector, clarifies govt
– India Inc likely to revert to pre-pandemic salary hikes
– AstraZeneca working on vaccine to prevent and cure Covid
– US eases travel curbs, fully jabbed can enter from Nov
Now lemme give you a quick glance on the state of the markets.
Dalal Street is likely to have a positive start this morning. Nifty futures on the Singapore Exchange traded 60 points higher at 8:10 hours (IST). Financial markets in China, South Korea and Taiwan were closed on Tuesday for holidays. Other Asian markets were trading mostly lower, extending Wall Street falls on contagion fears from the expected collapse of debt-plagued Chinese property giant Evergrande. MSCI’s broadest index of Asia-Pacific shares outside Japan was down 0.34 per cent.
Elsewhere, the yield on 10-year Treasuries held at 1.31%. The offshore yuan wallowed near an almost one-month low on Tuesday while the safe-haven dollar and yen stood tall as investors sought shelter from a potential China Evergrande default. Crude oil prices rose after a two-day decline with Hurricane Ida still having an impact on US crude output three weeks after making landfall.
That said, here’s what is making news.
Paras Defence & Space Technologies, which manufactures infrared lenses for thermal imaging systems and night vision cameras, plans to raise Rs 171 crore from the primary market. Of this, Rs 140 crore is a fresh issue of shares which will be used for capital expenditure and working capital funding while the balance is an offer for sale. The company operates in a segment with a high entry barrier. Investors with high risk appetite may consider the initial public offer given the opportunities to expand business on one end, and small size and a larger revenue collection period on the other end.
Fixed income investors unnerved by the volatility in interest rates and looking for predictable returns with low credit risk in debt mutual funds could opt for target maturity schemes, said investment advisors. This category of debt funds passively invests in bonds of a similar maturity constituting the fund’s benchmark index. On maturity of the fund, investors are returned their investment proceeds. This product is open-ended. While a fixed deposit with a bank offers 5.0-5.5% for five years, investors could earn about 5.9-6.3% from a target maturity fund with a tenure of about six years.
Funding costs for higher rated companies have declined significantly in the past two months, reflecting better transmission of rates, as broader economic revival has narrowed the spread between yields on government and corporate bonds. Contrary to expectations of higher fiscal borrowing to offset the rising economic costs of the pandemic, funding costs are going down for these companies that may be on the cusp of expansions. preads or differentials between companies rated up to AA- and respective government bonds have narrowed up to 24 basis points in the 5- and 10-year segments, show data compiled by JM Financial.
LASTLY,
The threat of a default by Evergrande, China’s second largest real estate company, on debt of more than $300 billion has been roiling the Chinese and Hong Kong markets. It’s having an impact on Indian stocks too. The selling of metal, steel, iron ore and chemical stocks that started in the middle of last week intensified on Monday. Indian metals, steel, iron ore, textiles, garments, chemicals and tyres among other sectors are likely to be hit if the Chinese government isn’t too keen on a timely bailout, according to analysts. They advise investors to reduce exposure to mid- and small-cap stocks and switch to large-caps, information technology and pharmaceutical stocks.
NOW Before I go, here is a look at some of the stocks buzzing this morning…
KEC International has diversified into engineering and construction for the oil and gas sector with an acquisition and a key appointment of a senior executive, and has ambitions of bagging big-ticket orders
in future.
US private equity fund CA Rover Holdings, an affiliate of Carlyle Asia Partners, is looking to sell a 3.4% stake in SBI Cards and Payment Services worth $443 million or Rs 3,267 crore through the stock exchange platform on Tuesday, according to a term sheet issued by the book runner BofA Securities.
Coal India Ltd said Monday that its subsidiary Bharat Coking Coal signed a revenue sharing contract worth nearly Rs 1,880 crore for commercial extraction of coal bed methane (CBM) with Prabha Energy.
L&T said its wholly-owned arm has won an order from Petronet LNG. The contract is for engineering, procurement, construction and commissioning of two LNG storage tanks with a capacity for Phase III B of the Dahej Expansion Project at Dahej, Gujarat, the company said.
Do also check out over two dozen stock recommendations for today’s trade from top analysts on ETMarkets.com.
That’s it for now. Stay with us for all the market news through the day. Happy investing!
