The Nifty and the Sensex opened the day on a negative note but have since recorded marginal gains after yesterday's near-flat close.
Join us as we follow the top business news through the day.
Central banks finance governments in the developed world
Sensex, Nifty end marginally higher after choppy trade; IT stocks shine
It was a day of choppy trading for the stock indices.
PTI reports: "Equity benchmarks Sensex and Nifty ended marginally higher after choppy trade on Tuesday amid mixed cues from the global markets.
Rising for the ninth session in a row, the 30-share BSE Sensex ended 31.71 points or 0.08 per cent higher at 40,625.51. The broader NSE Nifty inched up 3.55 points or 0.03 per cent to 11,934.50.
HCL Tech was the top gainer in the Sensex pack, rising around 4 per cent, followed by Kotak Bank, Infosys, Reliance Industries, UltraTech Cement and Tech Mahindra.
On the other hand, Titan, Sun Pharma, ICICI Bank, Axis Bank, SBI and Bajaj Finance were among the main laggards.
According to analysts, the recent recovery in market was led by expectations of fiscal stimulus from government, which has failed to cheer investor sentiment.
IT stocks continued to gain momentum ahead of crucial Q2 results and better earnings visibility, they added.
On the global front, bourses in Shanghai and Tokyo ended on a positive note, while Seoul was in the red. Stock exchanges in Hong Kong were closed for a holiday.
Stock markets in Europe were trading in the negative territory in early deals.
International oil benchmark Brent crude was trading 1.73 per cent higher at USD 42.44 per barrel.
In the forex market, the rupee depreciated 7 paise to close at 73.35 against the US dollar."
Vodafone Idea ropes in IBM for ‘big data’ platform
Telecom operator Vodafone Idea Ltd (VIL) on Tuesday said it has selected IBM for deployment and management of its ‘big data’ platform.
The move translates into key business and technology benefits such as “significant cost reduction” and streamlining operational complexity, as Vodafone Idea chases new revenue streams and opportunities backed by a future-ready network to leverage the transformational power of 5G going forward, a joint release said.
“The power of data will help transform our cloud and Artificial Intelligence journey in the future,” VIL Chief Technology Officer Vishant Vora said.
As VIL’s strategic technology partner, IBM is leading the end-to-end implementation and management of the ‘big data’ platform.
Grofers onboards 60 campus hires from premier institutions across India
Some welcome hiring in the battered labour market.
PTI reports: "Online grocery delivery platform Grofers on Tuesday said it has inducted a batch of 60 people from premier B-schools and engineering colleges in India, including IIT Delhi and IIM Bangalore.
Grofers has honoured all offers to campuses and has already initiated the virtual onboarding processes of the new hires, a statement said.
The addition of young talent from the campus hiring will foster innovation and creative thinking within the organisation, it added.
Some of the B-schools and engineering colleges inducted by the company are IIM Bangalore, IIM Calcutta, Management Development Institute, Mudra Institute of Communication, IIT Delhi, IIT Madras, IIT Roorkee, IIT BHU.
Other institutes include National Institute of Industrial Engineering , IIIT Allahabad, Jaypee Institute of Information Technology, Vellore Institute of Technology, Institute of Rural Management Anand (IRMA), and Symbiosis Nashik, among others, it said.
“At Grofers, we work in an ever-changing and challenging environment that requires a self-motivated workforce who can quickly adapt to the changes and present superior quality work.
“Over the last few months, our team members have shown extreme valour and resilience by serving the country in these challenging times, and we are delighted to have new team members joining our mission,” Grofers Head HR Ankush Arora said.
Grofers already employs over 23,000 team members across the country.
The company said it has hired delivery and warehouse staff from industries that have been deeply impacted by the crisis in the last few months.
An increasing number of people are adopting online grocery shopping amid the pandemic. Grofers said it has acquired over 18 lakh new users since the start of the lockdown."
Rupee settles 7 paise lower at 73.35 against US dollar
The rupee recovered some of its early losses but still ended the day in the red.
PTI reports: "The rupee depreciated 7 paise and settled at 73.35 (provisional) against the US dollar on Tuesday tracking muted domestic equities and strengthening American currency.
At the interbank forex market, the rupee opened on a weak note at 73.41, pared some losses and finally closed at 73.35 against the greenback, down 7 paise over its previous close of 73.28.
During the session, the domestic unit touched an intra-day high of 73.32 and a low of 73.41 against the American currency.
Meanwhile, the dollar index, which gauges the greenback’s strength against a basket of six currencies, rose 0.18 per cent to 93.23.
Forex traders said investors are cautious following muted domestic macro-economic data.
Rising food prices pushed retail inflation to an eight-month high of 7.34 per cent in September, above the RBI’s comfort level, while industrial output continued to contract in August, official data showed on Monday.
The decline in the Index of Industrial Production (IIP) was 10.8 per cent in July. The contraction in August stood at 8 per cent, as per the latest data.
On the domestic equity market front, the 30-share BSE benchmark Sensex was trading 5.27 points higher at 40,599.07 and broader NSE Nifty rose 2.05 points to 11,933.00.
Foreign institutional investors were net buyers in the capital market as they purchased shares worth Rs 615.17 crore on a net basis on Monday, according to provisional exchange data.
Brent crude futures, the global oil benchmark, rose 0.74 per cent to USD 42.03 per barrel."
Amazon workers in Germany strike on “Prime Day”
Amazon's worker troubles continue to persist as the company expands its global presence.
Reuters reports: "A German trade union called on workers at seven Amazon warehouses to go on strike on Tuesday to coincide with the global “Prime Day” promotion event that was postponed due to operational challenges from the coronavirus pandemic.
Verdi said it was organising the two-day strike as part of a long-running battle with Amazon in Germany over better pay and conditions, noting that a coronavirus bonus introduced for workers in Germany in March had been scrapped again in May.
An Amazon spokesman said the majority of employees were continuing to work as normal despite the strike call. He said the company offered “excellent salaries”, with benefits and working conditions comparable with other important employers.
Verdi has been organising strikes at Amazon in Germany since 2013, most recently in June in protest over safety after some staff at logistics centres tested positive for the coronavirus.
Germany is Amazon's biggest market after the United States.
Prime Day, typically held in July to boost summer sales, is now a kickoff to what will be an earlier holiday shopping season. The member-only discounts are a key way Amazon markets Prime, a fast-shipping and media-streaming service that incentivises subscribers to do more shopping on Amazon.
A report by news site Reveal said the week around last year's Prime Day was the most dangerous for injuries at Amazon's fulfillment centers, prompting criticism by a prominent union. Amazon disputed the claims."
Maruti Alto completes two decades, over 40 lakh units sold since debut
The country’s largest carmaker Maruti Suzuki India (MSI) on Tuesday said its entry-level model Alto has crossed 40 lakh sales milestone since its launch 20 years ago.
Empowering more than 40 lakh Indian households, Alto proudly celebrates 20 years of setting unmatched industry benchmarks, MSI said in a statement.
The model is testament of an iconic brand that evolved itself with the changing aspirations of young India, it added.
The compact car has undergone multiple changes and upgrades in the last two decades which has made it more contemporary and aligned to the evolving needs of the customer, the auto major said.
“Alto, over the past two decades has changed the way India commutes. It has been ranked as the number one selling car in last 16 years and continues to win hearts and surprise Indian car buyers with its exciting value proposition,” MSI Executive Director (Marketing & Sales) Shashank Srivastava said.
MCX plans to launch spot exchange in base metals
MCX's plans for expansion to deepen commodities trading in India.
PTI reports: "Multi Commodity Exchange of India on Tuesday said it is planning to launch spot exchange in base metals which will help develop and discipline the fragmented physical market and complement bourse’s delivery-based futures market.
We don’t have a robust spot market and that is one area we will cater in future by setting up a spot exchange which will help us to arrive at a fair price discovery, MCX MD and CEO P S Reddy said in a statement.
The country’s largest commodity exchange is a monopoly exchange in delivery-based base metals futures and options.
After delivery of over 1,00,000 tonne of base metals in the last one-and-a-half years, the bourse is planning to introduce the delivery of domestically refined lead futures, currently based on the one traded on the London Metal Exchange (LME).
Other base metals contracts too are benchmarked against LME.
Reddy said the LME benchmark is not relevant for India.
We should have price discovery based on how and what Indian traders trade, he said adding that MCX is working with Indian lead producers and probably from next financial year it will be ready to allow locally recycled lead with purity of .998 compared with current .999 necessary for LME approved brands.
MCX has already created an infrastructure and logistics to enable the delivery of domestically refined gold, that will help redefine India gold standard and help the country in curbing excessive gold imports and influence global price discovery.
Meanwhile, MCX is also set to launch its second cash-settled index futures in base metals, named Metaldex, with effect from October 19 as its first such product, Bulldex, evoked a good response since launch in August.
Bulldex, an index futures contract on gold and silver in a proportion of 71:29, has been clocking Rs 250-300 crore worth turnover every day since launch, Reddy added."
Indian shares up as cement stocks gain on govt infrastructure boost
An update on trading in the stock bourses this morning.
Reuters reports: "Indian shares rose on Tuesday as cement stocks gained on the federal government's plan to spend an extra 250 billion rupees on roads, ports and defence projects and provide interest-free loans to states to beef up infrastructure.
To boost demand, the government will also allow its employees to spend tax-exempt travel allowances on goods and services, Nirmala Sitharaman, India's finance minister, told a news briefing on Monday.
The NSE Nifty 50 index rose 0.40% to 11,978.35 by 0528 GMT, while the S&P BSE Sensex was up 0.35% at 40,741.49.
The Nifty Infrastructure index rose nearly 1% and was the top gainer among sub-indexes as Ultratech Cement added 3.2% and Shree Cement 2.5%.
However, some analysts said the rise in stocks was likely to be short-lived.
“There is a lift in sentiment for infra stocks, but the requirement is much higher and these moves are very temporary,” said Rahul Sharma, market strategist and head of research at Equity99 markets.
The Nifty IT index rose for the 12th straight session as investors, boosted by strong results and a buyback from Tata Consultancy Services, expected good numbers from Infosys Ltd, which is set to report on Wednesday.
Shares of smaller rival Wipro Ltd, which will report results later in the day, fell 0.2% after rising 5.5% since it announced a buyback plan.
Meanwhile, hopes of more interest rate cuts to boost the economy were dashed as India's retail inflation picked up in September to 7.34%, with food prices surging ahead of the festival season."
Global watchdogs agree rules for stablecoins like Facebook's Libra
Central banks set out to regulate cross-border stablecoins like Facebook's planned Libra with a common approach on Tuesday, saying more rules may later be needed to ensure stability.
The prospect of a currency-backed stablecoin being used by billions of people on Facebook has galvanised central banks into putting together rules and into considering how they could launch their own digital currency.
Existing national rules do not fully cover stablecoins the Financial Stability Board (FSB) said in a statement, adding that regulators should ensure that global stablecoins are fully accountable, keep data safely, have effective safeguards against cyber attacks and money laundering.
The FSB said it will take “appropriate actions” to ensure implementation of the guidance to avoid regulatory gaps that could undermine financial stability, by adhering to all applicable regulatory standards, addressing risks to financial stability before commencing operation, and adapting to new regulatory requirements as necessary.
Value of homes sold fell 43% in 9 months of 2020: Anarock
Homes worth about ₹88,730 crore were sold during the first nine months of the current year in the top seven markets, which was a decline of 42.5%, or ₹65,590 crore, over the same period last year, according to Anarock Property Consultants. The decline was attributed to the impact of COVID-19.
The total value of homes sold in the seven markets — Bengaluru, Pune, Hyderabad, Kolkata, Chennai, Mumbai Metropolitan Region (MMR) and Delhi NCR, stood at about ₹1.54 lakh crore in the same period of 2019.
Between January and September 2020, as many as 87,460 units were sold across these cities as against about 2.02 lakh units sold in the year-earlier period, as per Anarock.
MMR clocked sales of ₹49,313 crore, followed by Bengaluru (₹12,569 crore), Delhi NCR (₹9,430 crore), Pune (₹8,692 crore), Hyderabad (₹3,116 crore), Kolkata (₹2,833 crore) and Chennai (₹2,777 crore)
Stocks make peace with the prospect of a Joe Biden presidency
Rupee slips 13 paise to 73.41 against US dollar in early trade
The weak opening in stocks added pressure on the rupee.
PTI reports: "The rupee depreciated 13 paise to 73.41 against the US dollar in opening trade on Tuesday tracking strengthening American currency.
The Indian currency opened at 73.41 against the US dollar at the interbank forex market, down 13 paise over its previous close.
On Monday, rupee settled at 73.28 against the greenback.
Forex traders said investors are cautious following muted domestic macro-economic data.
Rising food prices pushed retail inflation to an eight-month high of 7.34 per cent in September, above the RBI’s comfort level, while industrial output continued to contract in August, official data showed on Monday.
The decline in the Index of Industrial Production (IIP) was 10.8 per cent in July. The contraction in August stood at 8 per cent, as per the latest data.
“The August industrial production missed estimates, coming in at (-) 8 per cent year-on-year (expected - 7.8 per cent). Given that the Reserve Bank is prioritising growth over inflation, the markets may read more into the IIP data than the CPI data,” said Abhishek Goenka, Founder and CEO, IFA Global.
“We expect the USD-INR to spend a few more sessions in the 72.90-73.90 range,” Goenka added.
Meanwhile, the dollar index, which gauges the greenback’s strength against a basket of six currencies, surged 0.10 per cent to 93.16.
On the domestic equity market front, the BSE benchmark Sensex was trading 147.46 points higher at 40,741.26, and the broader NSE Nifty rose 48.25 points to 11,979.20.
Foreign institutional investors were net buyers in the capital market as they purchased shares worth Rs 615.17 crore on a net basis on Monday, according to provisional exchange data.
Brent crude futures, the global oil benchmark, rose 0.17 per cent to USD 41.79 per barrel."
Factory output shrinks for sixth month
India’s industrial output fell for the sixth month in a row this August, even as consumer price inflation surged past the 7% mark, hitting 7.34% in September, with food price spikes reaching 10.68% compared with 9.05% in August.
The index of industrial production (IIP) shrank 8% in August on a year-on-year basis, quick official estimates suggest, marking a marginally improvement compared with July when output contracted 10.8% as per revised estimates. Earlier quick estimates had pegged July’s contraction at 10.4%.
August’s output does mark the lowest contraction since factory production began falling in March. Output had shrunk 18.7% in March, followed by contractions of 57.3% in April and 33.4% in May. Between April and August, industrial output has now shrunk 25%.
Heightened inflation, driven by food inflation and transport costs, will make it difficult for the Reserve Bank of India to cut rates in its December policy review meeting, economists reckoned.
Indian shares slip as September inflation rises
A negative opening for stocks this morning after yesterday's flat close.
Reuters reports: "Indian shares fell on Tuesday after data showed retail inflation touched its highest level in eight months, further dimming chances of interest rate cuts by the central bank to boost economic recovery.
India's retail inflation picked up in September to 7.34%, as food prices surged ahead of the festival season. That was higher than the forecast of 6.88% in a Reuters's poll of economists and the previous month's 6.69%
The NSE Nifty 50 index fell 0.21% to 11,906.35 as of 0345 GMT, while the S&P BSE Sensex was down 0.17% at 40,523.33. As of Monday's close, both indexes had gained for eight straight sessions.
Shares of the country's third largest IT services provider Wipro Ltd, which will report results later in the day and give details on a buyback plan, fell 0.33%.
The Nifty Bank index was down 0.9% ahead of a top court hearing on waiving interest on loans under moratorium."
GST Council still divided on States’ compensation
The Goods and Services Tax (GST) Council failed again on Monday to reach an agreement on the contentious issue of borrowings to meet shortfalls in cess collections used to recompense the States for revenue losses from the indirect tax implementation.
Finance Minister Nirmala Sitharaman, however, said the Centre is ready to help the States who have decided to borrow to bridge the cess shortfall.
“There was no consensus arrived on a matter on which differences exist. The GST Council can certainly take a call on cess, extending the period of cess collection. That was repeatedly reiterated but among the members themselves, the question was — can the GST Council decide if the Centre should borrow or the States should borrow,” Ms. Sitharaman said.
