The Nifty and the Sensex opened the day on a positive note with further gains after the record highs reached yesterday.
Join us as we follow the top business news through the day.
Sensex, Nifty snap 6-session winning run; end marginally lower
An end to the winning streak.
PTI reports: «Snapping their six-session winning streak, equity benchmarks Sensex and Nifty ended marginally lower on Tuesday amid profit-booking in IT, FMCG and auto stocks.
After rallying 487 points to touch its lifetime intra-day high of 51,835.86, the 30-share BSE Sensex pared all gains to end 19.69 points or 0.04 per cent lower at 51,329.08.
Similarly, the broader NSE Nifty slipped 6.50 points or 0.04 per cent to 15,109.30. It touched a record peak of 15,257.10 during the day.
M&M was the top laggard in the Sensex pack, shedding around 4 per cent, followed by Bajaj Finance, ITC, Sun Pharma, Bajaj Auto, Bajaj Finserv and TCS.
On the other hand, Asian Paints, ONGC, Titan, L&T and Axis Bank were among the gainers.
Domestic equities remained buoyant for most of the session with benchmark indices making fresh highs. However, high volatility was seen towards the end of the session and profit-booking was witnessed in a large number of stocks, experts said.
Broad-based rally was not seen and only select large cap counters supported market, said Binod Modi, Head – Strategy at Reliance Securities. Midcap and smallcap indices underperformed sharply and barring financials most of the key sectoral indices were in red.
Elsewhere in Asia, bourses in Shanghai, Hong Kong and Tokyo ended with gains, while Seoul closed lower.
Stock exchanges in Europe were trading on a negative note in mid-session deals.
Meanwhile, the global oil benchmark Brent crude was trading 0.40 per cent higher at USD 60.94 per barrel.»
Banks unions call for two-day strike against proposed privatisation of PSBs
Pushback from unions to the privatization of public sector banks.
PTI reports: «The United Forum of Bank Unions (UFBU), an umbrella body of nine unions, on Tuesday gave a call for a two-day strike from March 15 to protest against the proposed privatisation of two state-owned lenders.
In the Union Budget presented last week, Finance Minister Nirmala Sitharaman announced the privatisation of two Public Sector Banks (PSBs) as part of its disinvestment plan.
The government has already privatised IDBI Bank by selling its majority stake in the lender to LIC in 2019 and merged 14 public sector banks in the last four years.
It has been decided to oppose the government’s decision to privatise banks during the meeting of UFBU held on Tuesday, All India Bank Employees Association (AIBEA) general secretary C H Venkatachalam said.
«The meeting discussed the various announcements made in the budget of the central government regarding reform measures like privatisation of IDBI Bank and two PSBs, setting up of bad bank, disinvestment in LIC, privatisation of one general insurance company, allowing FDI in insurance sector up to 74 per cent, aggressive disinvestment and sale of public sector undertakings, etc,» he said.
The meeting observed that all these measures are retrograde and hence need to be opposed, he added.
After deliberations, it was decided to give the call for a two-day — March 15 and March 16 — strike against the government’s moves, AIBOC general secretary Soumya Datta said.
Members of UFBU include All India Bank Employees Association (AIBEA), All India Bank Officers’ Confederation (AIBOC), National Confederation of Bank Employees (NCBE), All India Bank Officers’ Association (AIBOA) and Bank Employees Confederation of India (BEFI).
Others are Indian National Bank Employees Federation (INBEF), Indian National Bank Officers Congress (INBOC), National Organisation of Bank Workers (NOBW) and National Organisation of Bank Officers (NOBO).»
Massive drop in LIC’s individual biz caps industry growth in Jan at 8%
A setback for LIC.
PTI reports: «A massive 45 per cent plunge in Life Insurance Corporation’s (LIC) individual annual premium equivalent (APE) in January capped the industry growth at 8 per cent for the month, according to a report.
Industry leader LIC saw its individual APE growth plummet to 45 per cent, due to a massively high base of 99 per cent growth in January 2020.
Yet, at 8 per cent, individual APE for the life insurance industry in January is higher than the 3 per cent it had managed to grow in December and 7 per cent decline in November 2020, according to the report by Kotak Securities.
However, this pick-up in individual business indicates a gradual increase in demand for Ulips, which has been the bane of the industry for quite sometime, said the report.
Moderation in growth of protection business from peak levels seems to have been arrested, as individual non-single sum assured to individual non-single premium for private players was 25 times in January. It was 23 times in December but stood lower at 31 times in January 2020 and 35 times in the second quarter 2020-21.
Overall, the APE was up 8 per cent led by 20 per cent growth in the group business but this looks to be volatile. Group APE growth remains strong, likely due to a pick-up in the credit protect business.
Industry leader LIC saw a 45 per cent plunge in individual APE. From the private sector, HDFC Life led the growth chart with a 24 per cent rise, 4 per cent higher than 20 per cent growth over the previous two months. ICICI Prudential saw this business declining 7 per cent, despite in January 2020 also this business was down 5 per cent.
For SBI Life, it was muted with 1 per cent growth, down from 7 per cent in December 2020 and 17 per cent in January 2020.»
Central Bank of India net profit up 6.5% at Rs 165 crore in Q3FY21
A public sector lender clocks profits.
PTI reports: «State-owned Central Bank of India on Tuesday reported a 6.5 per cent rise in its net profit to Rs 165.41 crore in the third quarter ended December.
The bank had posted a net profit of Rs 155.32 crore in the corresponding year-ago period.
Total income, however, fell to Rs 6,556.98 crore in October-December period of 2020-21 as against Rs 7,278.29 crore in same period of 2019-20, the bank said in a regulatory filing.
Interest income for the quarter under review was down to Rs 5,782.61 crore from Rs 6,028.88 crore in the year-ago quarter.
The bank’s asset quality improved with gross non-performing assets(NPAs) falling to 16.30 per cent of the gross advances as of December 31, 2020, from 19.99 per cent by end of December 2019.
In value terms, gross NPAs or bad loans stood at Rs 29,486.07 crore as against Rs 33,259.59 crore.
Net NPAs in the said quarter also came down to 4.73 per cent (Rs 7,514.65 crore) from 9.26 per cent (Rs 13,568.05 crore) in the year-ago period.
Provisions for bad loans and contingencies also decreased to Rs 743.74 crore for Q3FY21 from Rs 1,249.21 crore kept aside for the year-ago quarter.
Stocks of the bank were trading at Rs 15.03 apiece in afternoon session on BSE, up 1.35 per cent over previous close.»
India to be largest source of energy demand growth to 2040, says International Energy Agency
India will make up the biggest share of energy demand growth at 25% over the next two decades,as it overtakes the European Union as the world’s third-biggest energy consumer by 2030, the International Energy Agency (IEA)said.
India’s energy consumption is expected to nearly double as the nation’s gross domestic product (GDP) expands to an estimated $8.6 trillion by 2040 under its current national policy scenario, the IEA said in its India Energy Outlook 2021 released on Tuesday.
“This is underpinned by a rate of GDP growth that adds the equivalent of another Japan to the world economy by 2040,” said the IEA, the energy agency and policy adviser for members of the Organisation for Economic Co-operation and Development.
India-focussed offshore funds, ETFs see USD 986 mln outflow in Dec qtr: Report
This could be an interesting contrarian indicator.
PTI reports: «India-focussed offshore funds and Exchange Traded Funds (ETFs) witnessed a net outflow of USD 986 million in the three months ended December 2020, making it the eleventh consecutive quarter of withdrawals, according to a Morningstar report released on Tuesday.
The quantum is much lower than USD 1.8 billion outflow witnessed during the quarter ended September.
In the entire 2020, the category witnessed a net outflow of USD 9.3 billion, which was noticeably higher than the net outflow of USD 5.9 billion seen in 2019 and USD 5.3 billion in 2018.
India-focussed offshore funds and ETFs are some of the prominent investment vehicles through which foreign investors invest in Indian equity markets.
During the quarter ended December 2020, the offshore fund segment registered net outflows to the tune of USD 1.9 billion.
On the contrary, offshore ETF segment witnessed a divergent trend as it received net inflows over USD 800 million after five consecutive quarters of net outflows.
Flows into India-focussed offshore funds are generally considered to be long-term in nature whereas flows into ETFs indicate predominantly short-term money.
The India-focused offshore funds and ETF category have been witnessing net outflows since February 2018. The intensity had reached its peak in the March 2020 quarter as almost USD 5 billion left its coffers. This was the highest quarterly net outflow that the category had ever witnessed.
Although net outflows continued during the June, September, and December quarters of 2020, their intensity moderated considerably.
The net outflow from India-focussed offshore funds indicates that foreign investors with long-term investment horizons have been adopting a cautious stance towards the country, as per the report.
«Although this is concerning, it is not entirely unexpected, given the country’s current economic landscape and uncertainty over how soon India will be back on growth trajectory. That said, India equities continue to attract foreign investments through direct equity as well as the ETF route,» it noted.
Further, it said the future trend of the flows in the India-focused offshore funds and ETF category would revolve around how India fares in its fight against the pandemic versus other comparable countries and how the government brings the country’s economy back on track amid multiple hindrances.
Going ahead, the report said launch of the COVID vaccine in India and the measures announced by the government in the Union Budget to boost the economy should help in the reversal of this trend.
Despite net outflows, the asset base of the India-focussed offshore funds and ETFs category swelled during the quarter ended December, helped by the continued surge in the domestic equity markets.
Through the quarter, the assets of the category grew by almost 19 per cent to USD 43 billion from USD 36 billion recorded in the previous quarter.
During the quarter under review, the S&P BSE Sensex index surged 25.4 per cent whereas the S&P BSE Midcap and S&P BSE Smallcap indices shot up by 22 per cent and 21.7 per cent, respectively.»
IEA says India’s solar energy output to match coal-fired power by 2040
Changing dynamics in the energy market.
Reuters reports: «The share of solar energy in India’s power generation could equal coal-fired output by 2040, the International Energy Agency (IEA) said on Tuesday, driven by falling renewable tariffs and a government push to increase green energy use.
«Solar power is set for explosive growth in India, matching coal’s share in the Indian power generation mix within two decades,» the IEA said in its India Energy Outlook 2021 released on Tuesday.
Coal currently dominates India’s electricity sector, accounting for over 70% of overall generation with only about 4% produced through solar. India was on track to exceed its commitments as a part of the 2015 Paris agreement, the IEA said.
«This dramatic turnaround is driven by India’s policy ambitions, notably the target to reach 450 GW of renewable capacity by 2030, and the extraordinary cost‐competitiveness of solar,» the agency said.
India has the potential to become a world leader in battery storage, the IEA said, adding the country could add 140-200 GW capacity of battery by 2040.
Electricity consumption is expected to outpace overall energy demand by 2040, mainly due to higher use of air conditioners, the IEA said.
«Battery storage is particularly well suited to the short‐run flexibility that India needs to align its solar‐led generation peak in the middle of the day with the country’s early evening peak in demand,» the IEA said.
Still, India’s emissions of carbon dioxide could rise as much as 50% by 2040, the largest of any country, enough to offset entirely the projected fall in emissions in Europe over the same period.
That would also make India the second largest emitter of carbon dioxide, trailing only China.
India needs to expand pollution policies and sharply reduce coal‐fired generation to reduce its power sector’s emissions, the IEA said, adding current regulations were inadequate and utilities rarely deployed pollution cutting technology.
India is the world’s second largest coal market and holds the world’s fifth largest coal reserves. The nation’s coal demand is estimated to rise by over nearly a third by 2040, with share of imports shrinking to below 30%.
The IEA also warned that hundreds of thousands more could die every year due to higher exposure to air pollution, with the number of annual deaths potentially increasing by 200,000 from current levels to 1.4 million a year in 2040.»
‘Budget’s infra push with support to worst-affected would have been better’
The 2021-22 Union Budget’s bet on pushing infrastructure spending to revive the economy faces implementation risks and it may have been better to combine it with some income support for those worst affected by the pandemic, economists at leading think tanks said on Monday.
The rising tendency towards protectionism doesn’t sit well with India’s objective of attracting more foreign direct investment and integrating with global value chains, and a liberal tariff policy maybe more effective, argued Rajat Kathuria, director and chief executive of the Indian Council for Research on International Economic Relations (ICRIER).
Stressing that India needed globalisation more than other countries due to its growth potential, he said it would be better for India to maintain a sustainable current account deficit rather than celebrate the current account surplus expected this year.
Delhi HC stays order on Future Retail’s asset sale
The Delhi High Court on Monday stayed its February 2 interim order to Future Retail Limited (FRL) and various statutory authorities to maintain status quo with regard to its assets sale deal with Reliance Retail.
The bench of Chief Justice D.N. Patel and Justice Jyoti Singh said that statutory authorities such as the National Company Law Tribunal, Competition Commission of India, and the SEBI, cannot be restrained from proceeding in accordance with the law with regard to the deal. The order came on an appeal filed by FRL challenging the February 2 interim order by a single judge bench directing status quo with regard to its assets sale deal with Reliance Retail.
Petrol, diesel prices at fresh highs; petrol crosses ₹87 mark in Delhi
Petrol and diesel prices on Tuesday climbed to fresh highs in the country as rates were hiked after a three-day hiatus.
Petrol and diesel prices were hiked by 35 paise per litre each, according to price notifications of state-owned fuel retailers.
The increase took petrol prices to a fresh high of ₹87.30
a litre in Delhi and to ₹93.83 in Mumbai. Diesel rates rose to ₹77.48 per litre in the national capital and to an all-time high of ₹84.36 in Mumbai.
Prices were last hiked by 30 paise on February 5.
Rates have risen by ₹3.59 per litre in case of petrol and by ₹3.61 on diesel in 2021. Brent crude oil price on Monday rose above $60 per barrel for the first time in more than a year on improving demand outlook amid the global rollout of COVID-19 vaccines.
Rupee rises 8 paise to 72.89 against US dollar in early trade
The rupee’s opening once again mirrors that of stocks.
PTI reports: «The rupee appreciated by 8 paise to 72.89 against the US dollar in opening trade on Tuesday tracking positive domestic equities and persistent foreign fund inflows.
At the interbank forex market, the local unit opened sharply higher at 72.87 against the US dollar and lost some ground to 72.89 in early deals, registering a rise of 8 paise over its last close.
In the previous session, the rupee had slipped 4 paise to settle at 72.97 against the US dollar.
On the domestic equity market front, the 30-share BSE Sensex was trading 167.76 points or 0.33 per cent higher at 51,516.53, and the broader NSE Nifty rose 62.20 points or 0.41 per cent to 15,178.00.
Foreign portfolio investors (FPIs) were net buyers in the capital market as they purchased shares worth Rs 1,876.60 crore on Monday, as per exchange data.
The dollar index, which gauges the greenback’s strength against a basket of six currencies, declined 0.21 per cent to 90.73.
Meanwhile, the global oil benchmark Brent crude was trading 0.78 per cent higher at USD 61.03 per barrel.»
Titan unveils fitness-centric smartwatch
Titan, part of the Tata Group, unveiled a fitness-focused smartwatch brand ‘TraQ’ to capture a share of an increasing market of customers looking to track their performance in sports such as running, cycling and swimming. This is the first-ever smart gear developed entirely by Titan, said Suparna Mitra, CEO, watches division, Titan Co. Ltd.
She added TraQ was conceptualised in-house at the design studio in Bengaluru and made exclusively for India’s outperformers. On Monday, the company introduced three variants under the brand — TraQ Lite priced at ₹3,999, TraQ Triathlon (₹17,999) and TraQ Cardio (₹16,999).
Ms Mitra said, “An increasing number of Indians are taking up sports like running, cycling and swimming. The pandemic has accentuated this trend, creating demand for dedicated gear for tracking performance in these sports.”
Sensex jumps over 200 points; Nifty nears 15,200
Another good start to the day for stocks.
PTI reports: «Equity benchmark Sensex jumped over 200 points to scale fresh lifetime high in early trade on Tuesday, led by gains in index heavyweights Infosys, Reliance Industries and HCL Tech amid positive global cues and unabated foreign fund inflows.
The 30-share BSE index was trading 233.30 points or 0.45 per cent higher at its record intra-day peak of 51,582.07.
Similarly, the broader NSE Nifty rose 70.10 points or 0.46 per cent to its lifetime high of 15,185.90.
HCL Tech was the top gainer in the Sensex pack, surging around 2 per cent, followed by Infosys, Titan, Asian Paints, ONGC, Reliance Industries and Tech Mahindra.
On the other hand, SBI, Bajaj Finserv, Bajaj Finance, Axis Bank and IndusInd Bank were among the laggards.
In the previous session, Sensex ended 617.14 points or 1.22 per cent higher at its record closing peak of 51,348.77, and Nifty surged 191.55 points or 1.28 per cent to its lifetime closing high of 15,115.80.
Foreign portfolio investors (FPIs) were net buyers in the capital market as they purchased shares worth Rs 1,876.60 crore on Monday, as per exchange data.
According to Binod Modi Head-Strategy at Reliance Securities, domestic equities continue to look good at the moment. «Union Budget has given an undisputed reason to investors to cheer, which helped the market to see a northward journey in this month.» On the global front, US equities extended gains and recorded fresh highs led by a sharp rebound in energy stocks, strong corporate earnings and emerging prospects of higher fiscal stimulus.
Elsewhere in Asia, bourses in Shanghai, Hong Kong, Seoul and Tokyo were trading with gains in mid-session deals.
Meanwhile, the global oil benchmark Brent crude was trading 0.51 per cent higher at USD 61.01 per barrel.»
Tesla buys $1.5 billion in Bitcoin, will accept as payment soon
Holders of Bitcoin may be able to cash in some of their investment in the digital currency for a brand new electric car.
Electric automaker Tesla said Monday that it has invested around $1.5 billion in Bitcoin and it plans to begin accepting the digital currency as payment for its high-end vehicles soon.
The price of Bitcoin soared 15.4% to around $44,500 on Monday in reaction to Tesla’s announcement, according to CoinBase.
The California-based electric car maker headed by Elon Musk revealed the new strategy in a filing with the U.S. Securities and Exchange Commission, saying its investment in digital currency and other “alternative reserve assets” may grow.
Bitcoin has drawn enthusiasts for its scarcity and security, but the volatile digital currency still is not widely used to pay for goods and services.