Today's top business news: Shares jump to new high, Supreme Court orders stay on new farm laws, govt rejects demand for further extension of returns filing date beyond Feb 15, and more

A man walks out of the Bombay Stock Exchange (BSE) building in Mumbai, India.   | Photo Credit: Reuters

The benchmark stock indices opened the day on a  negative note as RBI note on bad loans weighed on banking stocks.

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

4:30 PM

India's top court orders stay on new farm laws that riled growers

A temporary victory for protesting farmers.

Reuters reports: "India's Supreme Court ordered an indefinite stay on Tuesday over the implementation of new agricultural laws that have triggered widespread protest from farmers, saying it would set up a panel to hear their objections.

For more than a month, tens of thousands of farmers have camped on the outskirts of New Delhi, the capital, to protest against reform measures that they say benefit large private buyers and harm growers.

Chief Justice Sharad Bobde told a hearing the Supreme Court would establish a panel to hear the farmers' grievances.

"We have the power to make a committee and the committee can give us the report," he said, ordering the stay for an undisclosed period on the laws passed in September.

"We will protect farmers."

There were no immediate further details.

India says the laws aim to modernise an antiquated farming system, bedevilled by wastage and bottlenecks in the supply chain.

But farm leaders demand repeal of the laws, which they say are an attempt to erode a longstanding mechanism that ensures farmers a minimum support price for their crops.

The government has said there was no question of such a rollback, and eight rounds of talks have failed to find common ground. The two sides are set to meet next on Friday."

4:00 PM

Sensex jumps 248 points to end at new peak; Nifty tops 14,500

Another fresh high for stocks.

PTI reports: "Equity benchmark Sensex jumped 248 points to end at a fresh life-time high on Tuesday, tracking gains in index heavyweights Reliance Industries, HDFC Bank and Bharti Airtel amid positive global cues and persistent FPI inflows.

After touching an all-time high of 49,569.14 during the day, the 30-share BSE index ended 247.79 points or 0.50 per cent higher at 49,517.11.

Similarly, the broader NSE Nifty advanced 78.70 points or 0.54 per cent to a fresh closing peak of 14,563.45. It scaled a record 14,590.65 during the session.

On the Sensex chart, SBI was the top gainer, rallying around 4 per cent, followed by Bharti Airtel, Reliance Industries, HDFC Bank, ITC, Axis Bank and NTPC.

On the other hand, Asian Paints, HUL, Nestle India, Titan and Kotak Bank were among the laggards.

According to Binod Modi, Head- Strategy at Reliance Securities, domestic equities remained resilient as they recovered sharply from the day's low and recorded fresh highs.

Banking stocks once again defied red flags raised by RBI's Financial Stability Report by recovering sharply from early losses, he said, adding that auto stocks continued to see healthy traction as well with expectations of good Q3 earnings and strong outlook.

Foreign portfolio investors (FPIs) were net buyers in the capital market as they purchased shares worth Rs 3,138.90 crore on Monday, according to exchange data.

Elsewhere in Asia, bourses in Shanghai, Hong Kong and Tokyo ended with gains, while Seoul was in the red.

Stock exchanges in Europe were largely trading on a positive note in early deals.

Meanwhile, the global oil benchmark Brent crude was trading 1.60 per cent higher at USD 56.55 per barrel."

3:00 PM

Rupee recovers losses, settles 15 paise higher at 73.25 against US dollar

A recovery in the rupee in line with stocks.

PTI reports: "The rupee recouped early losses and provisionally closed 15 paise higher at 73.25 against the US dollar on Tuesday, supported by weakness in the dollar index and recovery in domestic equities.

At the interbank forex market, the rupee opened weak at 73.42, but recovered lost ground and finished 15 paise higher over its last close.

During the trading session, the domestic unit witnessed an intra-day high of 73.24 and a low of 73.44.

On Monday, the rupee had closed at 73.40 against the American currency.

Meanwhile, the dollar index, which gauges the greenback's strength against a basket of six currencies, fell 0.09 per cent to 90.38.

On the domestic equity market front, the BSE Sensex ended 247.79 points or 0.50 per cent higher at 49,517.11, while the broader NSE Nifty advanced 78.70 points or 0.54 per cent to 14,563.45.

Foreign institutional investors were net buyers in the capital market as they purchased shares worth Rs 3,138.90 crore on Monday, according to provisional exchange data.

Brent crude futures, the global oil benchmark, rose 1.71 per cent to USD 56.61 per barrel."

2:30 PM

How different is Signal from WhatsApp?

Recently, Facebook-owned WhatsApp updated its privacy policy, prompting several users to look for alternative platforms. That search led them to few available rival messaging apps. Top among them is Signal, a California-based app, run by a not-for-profit organisation.

Tesla CEO Elon Musk’s tweet encouraging users to switch to Signal has given the privacy-focussed app an extra lift.

What is Signal Messenger?

Signal Messenger was founded by Moxie Marlinspike and Brian Acton in 2018. Apparently, Acton is also the co-founder of WhatsApp. He left the Facebook-owned company three years after the social network bought it for $19 billion.

Signal Foundation’s aim to provide its users an encrypted messaging app. The application is open source, and in fact, WhatsApp currently uses Signal’s end-to-end encryption protocol.

Read more

2:00 PM

Policy update doesn't affect privacy of messages;includes change related to messaging a biz:WhatsApp

An update on the WhatsApp privacy controversy.

PTI reports: "WhatsApp on Tuesday said its latest policy update does not affect the privacy of messages as the Facebook-owned company sought to address concerns around security of user data on the platform.

In a blogpost, WhatsApp emphasised that it does not share users' contact lists or data of groups with Facebook for ads purposes, and that neither WhatsApp nor Facebook can read messages or hear calls between users on WhatsApp.

Last week, WhatsApp had informed users of an update in its Terms of Service and privacy policy regarding how it processes user data and partners with Facebook to offer integrations across the social media giant's products.

It also stated that users will have to agree to the new terms and policy by February 8, 2021, in order to continue using WhatsApp's service.

This kickstarted a spate of conversations and memes on the internet over WhatsApp's alleged sharing of user information with Facebook, and many users have started shifting to rival platforms like Telegram and Signal.

"We want to be clear that the policy update does not affect the privacy of your messages with friends or family in any way. Instead, this update includes changes related to messaging a business on WhatsApp, which is optional, and provides further transparency about how we collect and use data," WhatsApp said.

It added that WhatsApp accesses only the phone numbers from the address book (after getting user's permission) to make messaging fast and reliable, and that it doesn't share contact lists with the other apps Facebook offers.

"We use group membership to deliver messages and to protect our service from spam and abuse. We don't share this data with Facebook for ads purposes. Again, these private chats are end-to-end encrypted so we can't see their content," it noted.

A report by internet security researcher Rajshekhar Rajaharia had claimed that at least 1,700 private WhatsApp group links were visible on Google through a web search.

WhatsApp noted that users can choose to set their messages to disappear from chats "for additional privacy".

The messaging giant - which has about 400 million users in India - said it will always be clear within the app when users are communicating with any business that uses its features designed for commercial entities.

WhatsApp explained that some large businesses need to use hosting services to manage their communication, and that it provides them the option to use secure hosting services from Facebook to manage WhatsApp chats with their customers, answer questions, and send information like purchase receipts.

"But whether you communicate with a business by phone, email, or WhatsApp, it (business) can see what you're saying and may use that information for its own marketing purposes, which may include advertising on Facebook. To make sure you're informed, we clearly label conversations with businesses that are choosing to use hosting services from Facebook," WhatsApp added.

WhatsApp said if users choose to interact with 'Shops' (Facebook branded commerce feature), their shopping activity can be used to personalise their Shops experience and the ads users see on Facebook and Instagram.

"Features like this are optional and when you use them we will tell you in the app how your data is being shared with Facebook... If you have WhatsApp installed on your phone, you'll have the option to message that business. Facebook may use the way you interact with these ads to personalise the ads you see on Facebook," it added.

Interestingly, a number of business leaders including Mahindra Group Chairman Anand Mahindra, Paytm founder Vijay Shekhar Sharma and PhonePe CEO Sameer Nigam have spoken of moving to rival platforms.

Mahindra said he had installed Signal, while Nigam said he had moved 1,000-plus 'PhonePe-rs' to Signal, and recreated all his work groups and moved family groups.

"...WhatsApp is by far and away the best product I've ever seen in the social/comm category. I trusted the WA founders. I loved the simplicity of their product. Never imagined switching to another chat app. C'est la vie," Nigam tweeted.

Sharma also advocated moving to Signal. "They say, market has power. We are the largest market. Here in India WhatsApp/Facebook are abusing their monopoly & taking away millions of users' privacy for granted. We should move on to @signalapp NOW. It is upto us to become victim or reject such moves," he said in a tweet."

1:30 PM

GoAir begins vaccine delivery; Operates flight to Chennai from Pune containing 70,800 vials

The vaccine supply chain at work.

PTI reports: "Budget carrier GoAir has operated a flight to Chennai from Pune, containing 70,800 vials of COVID-19 vaccines as the much-awaited roll out of the vaccine commenced on Tuesday.

The flight took off for Chennai from Pune early morning on Tuesday, carrying 70,800 vials (7,08,000 doses) of the vaccine, according to GoAir.

"We at GoAir are overwhelmed with the kind of responsibility bestowed upon us to transport the life-saving COVID-19 vaccines. We are grateful that we have got an opportunity to be able to contribute to the vaccine movement and support the noble cause," GoAir chief Executive Officer, Kaushik Khona said in a statement.

"In our efforts to alleviate the complexities of the vaccine movement given the scale of the consignments and logistics, we are taking every possible step to support the institutions and our stakeholders to reach the vaccine in all possible corners of the country," he said.

This responsibility of vaccine shipment recognises the efforts taken by GoAir towards developing its cargo services for critical vaccine movement and motivates us to take the lead in order to remain the preferred choice for the industry, Khona added.

Earlier in the day, flights started ferrying vaccines to different cities from Pune with the first consignment of Covishield vaccines in a flight operated by budget carrier SpiceJet reaching Delhi from Pune at around 10 am, four days ahead of the launch of a nationwide drive against coronavirus.

Civil Aviation Minister Hardeep Singh Puri said four airlines will operate nine flights to transport 56.5 lakh doses of COVID-19 vaccine from Pune to 13 cities across the country on Tuesday."

1:00 PM

Crypto inflows slump after December record - report

Investment flows into cryptocurrency funds and products were just $29 million in the first week of January, down sharply from a record $1.09 billion in the week before Christmas, according to the latest data on Monday from asset manager CoinShares.

In addition, the data showed pointed profit-taking from record prices, with some investment products seeing outflows.

Nevertheless, total assets under management (AUM) in the industry stood at an all-time peak of $34.4 billion as of Jan. 8. At the end of 2019, the total was just $2 billion.

Bitcoin plunged more than 19% on Monday, putting it on track for its biggest one-day drop since March as its surge to a record $42,000 last week lost steam.

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12:30 PM

Banks weigh on Indian shares after RBI warns of bad loan spike

An update on the stock bourses.

Reuters reports: "Indian shares inched lower on Tuesday as gains in metals and energy stocks were outweighed by losses in banks after the central bank said domestic lenders might see bad loans double.

The blue-chip NSE Nifty 50 index slipped 0.1% to 14,473 and the benchmark S&P BSE Sensex eased 0.25% to 49,143.75 by 0505 GMT.

Banks were the top losers, with the Nifty bank index shedding 0.74% and the Nifty private bank index declining 0.6%.

Late on Monday, the Financial Stability and Development Council said in a report that the gross non-performing assets of Indian banks might increase from 7.5% in September 2020 to 14.8% under a severe stress scenario.

"Markets are trying to consolidate... Investors will take cues from (corporate) results until the union budget," said Gaurav Garg, head of research at CapitalVia Global Research.

"The financial stability report is definitely a red flag for banks. The impact might be more on public sector banks compared to private banks."

Shares of Gail (India) Ltd rose 5.8% to a 15-month high of 143.5 rupees after the state-owned gas distribution firm said it would consider a proposal to buy back shares.

Tata Motors rose 6.9%, buoyed by a double-digit increase in China sales of its luxury car unit Jaguar Land Rover (JLR).

Indian investors now await retail inflation data due later in the day, with a Reuters poll predicting it fell sharply last month, landing within the Reserve Bank of India's target range.

Meanwhile, MSCI's broadest index of Asia-Pacific shares outside Japan fell 0.3% after touching an all-time high on Monday."

12:00 PM

Budget 2021-22: Govt should provide additional funds, incentives for agri sector, say experts

The budgetary allocation for agriculture will be under focus amid farmer protests.

PTI reports: "The government should provide additional funds as well as incentives in the upcoming Budget to promote indigenous farm research, oilseeds production, food processing and organic farming for the overall growth of the agriculture sector, according to industry experts.

The direct benefit transfer (DBT) scheme should be utilised more to support farmers instead of giving subsidies, they added.

"Food processing industry has played an important role in better price realisation for the farmer and reducing the cost of intermediaries. The budget must provide special incentives to food processing through incentives such as interest subvention, lower taxes, access to technology and so on," DCM Shriram Chairman and Senior MD Ajay Shriram said.

Referring to the successful PM-KISAN scheme under which Rs 6,000 is paid annually directly into farmers bank accounts, he said the DBT mechanism should be fine-tuned and gradually should be utilized to support farmers in lieu of other subsidies.

"Let the farmer decide how to judicially use the money. With the benefit of DBT, farmers can then buy better seed, use new-age fertilizers, optimize water usage and so on," Shriram said.

Stating that many Indian startups have invested in the agri-technology space, he advocated for a policy that encourages growth of these companies and adoption of latest techniques.

He said there has not been any significant breakthrough in recent years from indigenous agricultural research and development (R&D) and this could be partly on account of resource crunch.

"Two areas that need immediate attention are firstly linking agricultural research with industry requirements and secondly avoiding ideological resistance to new-age technologies such GM crops," Shriram said.

Consulting firm Deloitte India suggested that more funds should be allocated for research and development as well as for increasing the domestic production of oilseeds to reduce imports of cooking oils.

Stating that livestock farming is one of the key pillars for augmenting farmers' income, the consulting firm said one of the big impediments for development of this sector is the prevalence of various diseases that affect mortality, productivity, and overall production.

"Supply of vaccines is not adequate to address the increasing demand. Funding for developing vaccines and creating necessary infrastructure would be required in this budget," Deloitte said.

Chirag Arora, Founder, Organisch Overseas, said the government must encourage farmers to adopt organic farming.

"The need of the hour is to encourage the private sector into the space by offering tax incentives to startups venturing into this domain. It also needs to augment investment on creation of cold-chains and increase storage capabilities," Arora said.

Last month, in a virtual pre-budget consultation with the finance ministry, Bharat Krishak Samaj (BKS) had said that the government should incentivise balanced use of fertilisers by increasing urea price and lowering rates of phosphatic and potassic (P&K) nutrients in the upcoming Budget.

BKS Chairman Ajay Vir Jakhar had also sought reduction in taxes on diesel and transport subsidy on fruits and vegetables, but demanded tax on unhealthy foods. He had pitched for tripling investment for micro-irrigation and solar pumps for individual farmers as well as funding for distribution of soil moisture measuring sensors.

"Prioritize investment in human resources over infrastructure. There are about 50 per cent vacancies in agriculture research institutions across India. Target 2 per cent expenditure on agri R&D of agriculture GDP over the next few years," BKS had said."

11:30 AM

Govt rejects demand for further extension of returns filing date beyond Feb 15

No more extension of the deadline for filing tax returns.

PTI reports: "The finance ministry has rejected the demand for further extension of the last date for filing returns where audit is required beyond February 15.

Last month, the government had extended the income tax return (ITR) filing deadline for individuals till January 10, and for companies till February 15.

"CBDT passes order u/s 119 of Income-tax Act, 1961 in F No. 370153/39/2020-TPL dt 11th January, 2021, disposing off the representations for extension of due date for filing of Audit Report u/s 44AB, in compliance with the order of hon'ble Gujarat High Court dt 8th January, 2021," the income tax department said in a tweet on Monday.

This was in response to the Gujarat High Court order dated January 8, 2021 in the case of The All India Gujarat Federation of Tax Consultants versus Union of India directing the finance ministry to look into the issue of extension of due dates for filing of audit reports under Section 44AB of the Income Tax Act.

As per the provisions of the Act, the due date for filing of the audit report under Section 44AB is one month prior to the due date of filing of income tax return, it said.

The due dates for payment of self-assessment tax for taxpayers whose amount due does not exceed Rs 1 lakh also coincide with the due dates for filing of ITR, it said.

On December 30, 2020, the government had announced extension of the last dates for filing of returns by individuals to January 10, 2021 from December 31, 2020.

In case of return for tax audit cases, the date was extended to February 15, from the earlier January 31. It was for the third time the tax department extended the dates."

11:00 AM

What avocadoes predict for bitcoin


10:40 AM

Rupee slips 4 paise to 73.44 against US dollar in early trade

The rupee mirror's stocks once again this morning.

PTI reports: "The rupee depreciated 4 paise to 73.44 against the US dollar in opening trade on Tuesday, tracking the rebound in the American currency and muted opening of domestic equities.

At the interbank forex market, the domestic unit opened at 73.42 against the US dollar and fell to 73.44 against the greenback, registering a decline of 4 paise over its previous close.

On Monday, the rupee had finished at 73.40 against the American currency.

"Weak Asian currencies could continue to weigh on sentiment. However, foreign portfolio investor (FPI) flows into the domestic equity markets could cap losses," Reliance Securities said in a research note.

Meanwhile, the dollar index, which gauges the greenback's strength against a basket of six currencies, rose 0.12 per cent to 90.57.

"US dollar index extended gains this Tuesday morning in Asian trade against major peers as the prospect of massive fiscal stimulus pushed US yields higher," the note added.

The euro, sterling and Japanese yen were flat against the US dollar this morning in Asian trade.

On the domestic equity market front, the 30-share BSE benchmark Sensex was trading 81.23 points lower at 49,188.09, and the broader NSE Nifty was trading higher by 0.05 points at 14,484.80.

Foreign institutional investors were net buyers in the capital market as they purchased shares worth Rs 3,138.90 crore on a net basis on Monday, according to provisional exchange data.

Brent crude futures, the global oil benchmark, declined 0.13 per cent to USD 55.59 per barrel."

10:20 AM

Stretched valuations threaten stability: Shaktikanta Das

Reserve Bank of India (RBI) Governor Shaktikanta Das has flagged the growing disconnect between exuberant equity markets and real economic activity and warned that the ‘stretched valuations of financial assets’ threaten overall financial stability.

“The disconnect between certain segments of financial markets and the real economy has been accentuating in recent times, both globally and in India,” Mr. Das wrote in his foreword to the RBI’s biannual Financial Stability Report (FSR), which was released on Monday.

“Stretched valuations of financial assets pose risks to financial stability,” he cautioned.

Pointing to the interconnected nature of the financial system, the RBI Governor urged banks and financial intermediaries to be cognisant of the risk. India’s stock markets have been on a tear since plunging to their lowest levels in more than three years in March in the wake of the COVID-19 pandemic’s outbreak and ensuing lockdowns.

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10:00 AM

Indian shares edge lower as central bank report weighs on banks

The bad loan threat is back.

Reuters reports: "Indian shares inched lower on Tuesday, dragged down by banking stocks after the central bank said domestic lenders might see bad loans double, while investors awaited retail inflation data due later in the day.

The blue-chip NSE Nifty 50 index fell 0.2% to 14,462 and the benchmark S&P BSE Sensex was down 0.17% to 49,184.21 by 0346 GMT.

The gross non-performing assets of Indian banks may increase from 7.5% in September 2020 to 14.8% under a severe stress scenario, a report from the Financial Stability and Development Council said on Monday.

The Nifty bank index was down 0.74%, while the public sector bank index fell 0.94%.

Shares of Gail (India) Ltd rose 4.4% after the company said it would consider a proposal to buy back shares."

9:30 AM

Ford announces closing of Brazil manufacturing operations

Ford Motor has said it will close three plants in Brazil and stop producing automobiles in the South American country.

The company said in a statement on January 11 it will cease production immediately at the factories “as the COVID-19 pandemic amplifies persistent industry idle capacity and slow sales that have resulted in years of significant losses”.

The automaker also said it will keep its South America headquarters, product development centre and proving grounds in Brazil.

“With more than a century in South America and Brazil, we know these are very difficult, but necessary, actions to create a healthy and sustainable business,” said Jim Farley, Ford president and CEO. “We are moving to a lean, asset-light business model by ceasing production in Brazil and serving customers with some of the best and most exciting vehicles in our global portfolio.”

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Printable version | Jan 21, 2021 8:07:12 AM |

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