An unexpectedly strong report on the US job market raised concerns that the Federal Reserve will need to keep the pressure on inflation with aggressive interest rate increases. Investors are concerned that the central bank’s stance runs the risk that it could bring on a recession.
Stocks to Watch: Adani Ports, TechM, Infosys, Airtel, ONGC, UPL, Hero Motocorp, JK Tyre, LIC Housing Finance, Macrotech Developers, Reliance
Adani Transmission, P&G, Dalmia Bharat, Kajaria Ceramics, Grindwell Norton will be among the stocks in focus as they declare their September quarter earnings today. (Read More)
Fusion Microfinance IPO: Should you apply or skip as issue opens today? GMP, other details
The initial public offering (IPO) of microlender Fusion Microfinance will on Wednesday, November 2, 2022, and the issue, with a price band of ₹350-368 a share, will conclude on Friday, November 4, 2022. The company on Tuesday said it has raised a little over ₹331 crore from anchor investors ahead of its initial share sale.
As per market observers, Fusion Microfinance shares are commanding a premium (GMP) of ₹35 in the grey market today. The company’s shares are expected to list on stock exchanges BSE and NSE on Tuesday, November 15, 2022. (Read More)
INDIA BONDS-Bond yields seen little changed ahead of Fed policy decision
Indian government bond yields are expected to be little changed in early trades on Wednesday, ahead of the U.S. Federal Reserve’s much-awaited monetary policy decision later in the day.
The benchmark 10-year yield is likely to be in a 7.38%-7.43% band, a trader with a private bank said. The yield had ended five basis points lower at 7.3957% on Tuesday.
“We are back to 7.40% levels and any major incremental buying from this point needs a fresh trigger,” the trader said.
“The Fed’s forward guidance would be the major focus area as the rate action is already discounted in prices.” (Reuters)
Govt exempts big retailers from stockholding limits on edible oils, oilseeds
With easing edible oil prices in the domestic and international market, the union government on Tuesday exempted wholesalers and big chain retailers from the stock limit order on edible oil and oil seeds with immediate effect.
The ministry of consumer affairs, food & public distribution said that the stock limit order was imposed in the country due to increasing prices of edible oils and to check hoarding, profiteering & black marketing.
The removal will also have a positive effect on the oilseed prices as it will boost procurement of the oilseeds hereby increasing the returns of domestic oilseeds growing farmers, the ministry added. (Read More)
Expert views on Nifty’s performance on Tuesday – Geojit Financial Services, LKP Securities, Kotak Securities, Ashika Stock Broking
Vinod Nair, head of research at Geojit Financial Services: The bulls are driving the trend in the domestic market with backing from FIIs and the global markets. The PMI numbers show that manufacturing activity in India remained strong in October and that pricing pressures were kept in check as new orders and production increased, albeit slowly. Investors are keeping an eye on the central banks’ policy meetings for any indications of a slowdown in the pace of rate hikes.
Rupak De, senior technical analyst at LKP Securities: After starting higher the Indian Nifty remained strong throughout the session. On the daily chart, the index has moved above the previous swing high. The daily RSI is in bullish crossover. The trend remains strong as long as it remains above 18000. On the higher end, resistance is visible at 18300.
Shrikant Chouhan, head of equity research (retail), Kotak Securities Ltd: The benchmark indices continued positive momentum fourth day in a row, the nifty ended at 129 points higher while the Sensex was up by 375 points. Among Sectors, Metal and Pharma indices outperformed whereas intraday profit booking was seen in selective PSU Banks stocks. Technically, after promising 18000/60500 breakout last Tuesday, the market opened with a gap up and after strong opening the entire day it was hovering between 18060-18175/60870-61280. In addition, on daily charts, the index has formed Doji candlestick formation which indicates indecisiveness between the bulls and bears. However, the medium-term texture of the market is still on the positive side. for the trend following traders now, 18050/60870 would be the trend decider level. Above the same, the index could move up to 18250-18300/60400-60500. On the flip side, quick intraday correction is not ruled out, if the index succeeds to trade below 18050/60870. Below the same, the index is likely to touch 17950 -17900/60500-60400. The short-term texture of the market is mildly overbought hence level based trading would be the ideal strategy for the day traders.
Tirthankar Das, technical & derivative analyst, retail, Ashika Stock Broking Ltd: Nifty started the day on a positive note however volatility ruled the day ahead of the crucial Central Banks meet which will decidedly affect the stock market trend. The benchmark indices were seen shifting the range on the higher side as it provided a resonant breakout above the six-month-old high of 18114. Daily price action of higher high formation indicating continuance of positive bias and is likely to challenge the immediate hurdle of 18350 and gradually head towards 18600 in medium term. The elevated support base for the market is now at 17500 which seems unlikely to breach. Cool-off in Dollar index had been providing stability to the rupee against the US dollar, also sliding Oil prices following weak Chinese factory data is likely to support Indian equities going ahead.
After Thums Up and Sprite, Coca-Cola sets goal for Maaza to reach $1 billion
After scaling the milestone of $1 billion in annual sales for its Thums Up and Sprite brands, Coca-Cola India said on Tuesday that it is on track to ensure that its mango drink Maaza reaches $1 billion in annual sales by 2024.
“We would love to have one juice brand getting into that ($1 billion portfolio) very clearly—that’s our ambition. It may take a little bit longer, may not be by next year. Because one of the issues which happened is that this year, the mango crop has fallen, the price of mango is obnoxiously high. We have done good work in building operations for Maaza. If it happens, it’s good but definitely it will happen by 2024; if it happens by 2023 it will be a bonus,” Sanket Ray, president for India and South-West Asia, Coca-Cola, said during a media interaction at the company’s headquarters in Gurugram. (Read More)
LIC Housing Finance net profit rises 23% in second quarter
The second largest pure-play mortgage lender LIC Housing Finance on Tuesday announced a 23 per cent on-year growth in net profit at ₹305 crore for the three months period ending September.
The subsidiary of the country’s largest insurer LIC said its net interest income for the quarter declined marginally (80 basis points) to ₹1,163 crore from ₹1,173 crore, but the management did not give any reason for the same.
Individual loan disbursements declined marginally to ₹14,300 crore from ₹14,330 crore in the reporting quarter, taking total disbursements to ₹16,786 crore up 4 per cent from ₹16,110 crore, led by a 15 per cent increase in project loans at ₹407 crore from ₹353 crore. This pushed the total outstanding loan portfolio up 10 per cent at ₹2,62,336 crore, helping the company earn 8 per cent more in revenue from operations at ₹5,086 crore from ₹4,708 crore. (PTI)
57% of employers in manufacturing sector keen on hiring: Report
With a strong growth trajectory, the manufacturing sector in the country has anticipated an increase in hiring outlook as 57% of employers have expressed their intent to hire from October to December, according to a report.
Around 57 per cent of employers have expressed the intent to hire and expand their resource pool, TeamLease Services ‘Employment Outlook Report for Q3 (October to December 2022) for the manufacturing sector said on Tuesday.
From a macro perspective, the overall intent to hire, across manufacturing and services sectors combined, is projected to cross 70 per cent in the next few quarters, it stated.
“Post-Covid, global employment growth has recovered by 2.7 per cent and is currently on a strong growth trajectory in H2 2022. The third-quarter projections for the intent to hire, especially in the manufacturing segment, stand strong. (PTI)
Registrar of Companies (RoC) starts inquiry into MG Motor India affairs
The Registrar of Companies (RoC) has started an inquiry into the affairs of MG Motor India and has summoned the company’s top brass along with the company’s statutory auditor later this month, a person familiar with the development said.
The RoC inquiry is instituted under a provision in the Companies Act which involves more than a step of seeking information but is short of full-fledged investigation, the person said. The inquiry is around suspected financial irregularities but it is too early to comment upon that, the person said.
MG Motor India acknowledged the RoC communication and said it is a law-abiding, professionally managed company that adheres to the highest standards of compliance and governance and is committed to transparency. (Read More)
Infosys to take shareholders’ nod during Nov 3 – Dec 2 for ₹9,300-cr share buyback
Infosys will seek shareholders’ nod for its proposed ₹9,300 crore share buyback between November 3 to December 2 through postal ballot, the company said in a regulatory filing.
The Infosys board on October 13 had announced a share buyback of ₹9,300 crore via the open market route, for a price not exceeding ₹1,850 per equity share.
“…the Company is required to obtain the approval of its Members for the Buyback by way of a special resolution through Postal Ballot or at a general meeting by providing the facility to Members to vote by electronic means. Accordingly, the Company seeks your approval for the Buyback through this Postal Ballot Notice,” the filing said.
The board decided to return approximately 85 per cent of the free cash flow cumulatively over a five-year period through a combination of semi-annual dividends, share buyback, special dividends etc. (PTI)
Rupee rebounds 22 paise to 82.59 against US dollar
The rupee appreciated 22 paise to close at 82.59 against the US dollar on Tuesday amid persistent foreign fund inflows and a weakening greenback overseas.
At the interbank foreign exchange market, the local currency opened at 82.74 and witnessed a high of 82.59 and a low of 82.79.
It finally settled at 82.59 against the American currency, registering a rise of 22 paise over its previous close of 82.81.
Meanwhile, the dollar index, which gauges the greenback’s strength against a basket of six currencies, slipped 0.49 per cent to 110.98. (PTI)
Gold rises over 1% in run-up to Fed rate announcement
Gold rose over 1% on Tuesday as the US dollar and bond yields slipped from session highs, with the focus turning to a key Federal Reserve announcement for cues on whether it would scale back or retain its aggressive stance on interest rate hikes.
Spot gold rose 0.9% to $1,647.24 per ounce by 3:14 p.m. ET (1914 GMT), going as high as $1,696.94 earlier in the session. U.S. gold futures settled up 0.6% at %1,649.70. (Read More)
Airtel for higher rates, but to keep 5G at 4G tariffs for now
Bharti Airtel Ltd will keep 5G and 4G tariffs at the same levels for another six to nine months, after which it may decide on fixing 5G tariffs separately, chief executive officer Gopal Vittal said. In a call with investors after the company’s second-quarter earnings on Tuesday, Vittal, however, reiterated the need for existing tariff levels to rise.
Vittal also flagged that countries like the US, Thailand and South Korea that had priced 5G differently from 4G saw very little uptake of 5G services, with only a fraction of customers of local telcos opting for the premium 5G plans.
“In some markets where operators have chosen to price 5G at 10-20% premium, what we find is that the take rate is a fraction of the full base of customers; so, in other words, the ARPU is an illusion. Ultimately, what we need for monetization is the tariff table in itself to go up… also right now (we are) just building out the network and then we take a decision as to what to do in maybe six to nine months,” Vittal said. (Read More)
Tech Mahindra profit dips on staff, R&D costs
Tech Mahindra Ltd on Tuesday posted a 4.1% drop in quarterly net profit hit by expenses on new hires and investments in research and development (R&D) projects.
Profit in the three months ended 30 September fell to ₹1,285.4 crore from ₹1,340.9 crore in the previous year. Rupee revenue rose 21% to ₹13,129.5 crore from ₹10,881.3 crore during the period. Dollar revenue grew 11% to $1.63 billion from $1.47 billion. The software services firm reported an attrition rate of 20% in the quarter, which was noticeably lower than its peers in the Indian IT sector that’s grappling with attrition rates of 21-25%.
A 27% jump in expenses hit Tech Mahindra’s net profit in the quarter. This led to an 11% fall in Ebit (earnings before interest and taxes) to ₹1,468 crore. Ebit margin too, fell 3.8 percentage points to 11.4% in the quarter. (Read More)
Windfall tax on crude oil reduced; levy on export of diesel, ATF hiked
The Central government has reduced the windfall tax on crude oil to ₹9,500 a tonne from ₹11,000, showed an official notification. The change is effective from 2 November, a government notification showed.
The reduction in the tax is over 13%. The windfall tax levied as special additional excise duty is aimed at absorbing the super-profits earned by domestic crude oil producers and is revised every fortnight. (Read More)
Adani Ports and Special Economic Zone (APSEZ) posted a 33% year on year rise in revenue
Adani Ports and Special Economic Zone (APSEZ) posted a 33% year on year rise in revenue to ₹5211 crore in Q2FY23 while EBITDA rose to 31% to ₹3260 crore . PAT jumped 65% to ₹1738 crore from the same period of FY22. Quarterly cargo volume jumped 15% on year to 86.6 mn tonnes .
The company said records were set in the first half (Apr-Sep) of the current fiscal .
“H1 FY23 is a record half-year in APSEZ’s history, with the highest ever cargo volume, revenue and EBITDA,” said Karan Adani, CEO and Whole Time Director of Adani Ports and Special Economic Zone. “Extending this strong performance into October, APSEZ achieved 200 MMT of cargo through-put within seven months, another new milestone.”
For H1 FY23, this record cargo volumes have resulted in a 24% Y-o-Y jump in Port EBITDA, while the EBITDA of the logistics business jumped 57% Y-o-Y. The margin expansion of the logistics segment continued with a 470 bps Y-o-Y jump on the back of better utilization of assets and increased share of the GPWIS (general purpose wagon investment scheme)revenue stream, the company said post the results. (Read More)
Wall Street stocks end lower as hot jobs data signals aggressive Fed
Stocks on Wall Street gave up early gains and closed lower Tuesday after an unexpectedly strong report on the job market raised concerns that the Federal Reserve will need to keep the pressure on inflation with aggressive interest rate increases.
The S&P 500 fell 0.4% after having been up as much as 1% shortly after trading opened. The Dow Jones Industrial Average fell 0.2% and the Nasdaq composite dropped 0.9%.
Big technology stocks were the biggest weights on the market. The companies, with their big valuations, have more heft in pushing the broader market up or down. Also, rising interest rates tend to make the sector look less attractive because of those high valuations. Apple fell 1.8%.
Communication services stocks, retailers and other companies that rely on consumer spending also helped drag down the overall S&P 500, keeping gains in banks, energy firms and other sectors of the market in check. (AP)
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