Business Live: Stocks hit hard by worries of second wave of coronavirus

Exchanges in Shanghai, Hong Kong, Tokyo and Seoul finished up to 2% lower following a rout on Wall Street.

Exchanges in Shanghai, Hong Kong, Tokyo and Seoul finished up to 2% lower following a rout on Wall Street.   | Photo Credit: PTI

Updates from the world of economy, markets, and finance

Stocks dropped sharply this morning as negative global clues owing to fears of a second wave of the coronavirus pandemic led foreign investors to sell their holdings.

Domestic fuel prices continued to rise for the 9th straight day on Monday after dynamic pricing kicked in earlier this month.

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

2:00 PM

WPI inflation falls 3.21% in May, but food prices rise

Wholesale prices in the country witnessed a deflation of 3.21% in May due to sharp decline in prices of fuel and power, even as food articles turned expensive.

“The annual rate of inflation, based on monthly Wholesale Price Index (WPI), stood at (-) 3.21%(provisional) for May 2020 as compared to 2.79% during the corresponding month of the previous year,” the commerce and industry Ministry said in a statement.

Inflation in food articles during May stood at 1.13%, as against 2.55% in April. In fuel and power basket, deflation stood at 19.83% in May, as against 10.12% in the previous month.

Manufactured products witnessed a deflation of 0.42% in May.

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1:00 PM

Government holds back full IIP data for April

The government on Friday held back the release of the complete data of index of industrial production for April, saying it is not appropriate to compare the IIP data with earlier months due to the COVID-19 lockdown.

An official statement showed that the IIP — which measures factory output in the country — stood at 56.3 points in April 2020 compared to 126 in the same month a year ago.

“In view of the preventive measures and announcement of nationwide lockdown by the government to contain the spread of COVID-19, majority of the industrial sector establishments were not operating from the end of March 2020 onwards.

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12:30 PM

Alto becomes best-selling model for 16th straight year

The budget car comes up as the surprising winner when it comes to the most number of units sold.

PTI reports: "The country’s largest carmaker Maruti Suzuki India (MSI) on Monday said its entry level small car Alto has become the best-selling model for the 16th year in a row clocking sale of 1.48 lakh units in 2019-20.

Launched in September 2000, the Alto became India’s bestselling car in 2004 for the first time, the company said in a statement.

MSI Executive Director (Marketing and Sales) Shashank Srivastava said the strong customer base of Alto is a testament of customers appreciating the timely upgrades and refreshment in the brand.

Maruti Suzuki has kept a close eye on the evolving customer preferences and aligned its product range to such changes,” he added.

Keeping with new regulations, the current Alto comes with standard safety features including driver side airbag, anti-lock braking systems and electronic brake-force distribution, reverse parking sensor and high speed alert system.

It also complies with latest crash and pedestrian safety regulation, the company said."

12:00 PM

Retail investors beat hedge fund wizards

 

11:30 AM

Get rid of EMIs, go for investments

“Not having the burden of EMI is a big relief,” a banker who had retired from a foreign lender at a senior level had told me once.

His comment surprised me a little. As a banker all his life, he was supportive of loans. In fact, he had even resisted my recommendation to pay back his home loan at an early date. However, he said, he had realised the stress it had caused on the family and after retirement, even he was not comfortable with it.

This is not a stray experience for me. A CEO of an MNC was relieved when his loan was paid back.

He was not happy in his job, it was turning out to be stressful and he was missing spending time with family and pursuing hobbies which he wanted to do all his life.

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11:00 AM

Rupee slips 13 paise to 75.97 against US dollar in early trade

The weak sentiment in domestic equities has weighed on the rupee this morning.

PTI reports: "The rupee depreciated 13 paise to 75.97 against the US dollar in opening trade on Monday as weak domestic equities and sustained foreign fund outflows weighed on investor sentiment.

Forex traders said risk appetite has waned amid fresh cases of COVID-19 globally.

The rupee opened weak at 75.93 at the interbank forex market. It fell further to 75.97 against the US dollar, down 13 paise over its last close.

It had settled at 75.84 against the US dollar on Friday.

“There has been a fresh spike in coronavirus cases in Tokyo, Beijing and the US and this is weighing on risk sentiment,” said Abhishek Goenka, Founder and CEO, IFA Global.

Goenka further said that India’s forex reserves crossed the USD 500 billion, rising USD 8 billion in the week ended June 5.

“This shows how aggressively the Reserve Bank of India has been absorbing Inflows. The reserve cushion would give the central bank ammunition in containing volatility during bouts of outflows,” he said.

Meanwhile, the 30-share BSE benchmark Sensex was trading 387.08 points lower at 33,393.81 and the broader NSE Nifty fell 105.95 points to 9,866.95.

Foreign institutional investors were net sellers in the capital market as they sold shares worth Rs 1,311.49 crore on Friday, according to provisional exchange data."

 

10:40 AM

India to get its maiden gas trading platform

India will on Monday get its very own natural gas trading platform that will help discover local market price for gas through transparent demand-supply matching.

Oil Minister Dharmendra Pradhan will launch the Indian Gas Exchange (IGX) to kickstart natural gas trading, official sources said.

IGX is India’s first automated national level trading platform to promote and sustain an efficient and robust gas market and foster gas trading in the country.

The platform will feature multiple buyers and sellers trading in spot and forward contracts at designated physical hubs. IGX is a neutral and transparent market-place where both buyers and sellers will trade gas as the underlying commodity.

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10:30 AM

Yuan slips to 1-week low on investor worries over second wave of virus on mainland

The much-feared second wave of the coronavirus may be here, and investors are spooked over it.

Reuters reports: "The yuan struck a one-week low against the dollar on Monday due to fears that the emergence of a new coronanvirus cluster in Beijing could be the start of a second wave of infection, clouding the outlook for an economic recovery.

Beijing in recent days recorded dozens of new locally transmitted cases, all linked to a major wholesale food market, after weeks with almost no new infections.

“The COVID-19 outbreak in Beijing over the past weekend was apparently a shock to the Chinese government, and we believe the risk of a second wave in China has risen significantly just over the weekend,” Lu Ting, chief China economist at Nomura, said in a note. “Markets will likely revise down their expectations of a growth recovery.”

Prior to market opening, the People's Bank of China (PBOC) set the midpoint rate at 7.0902 per dollar, 37 pips or 0.05% weaker than the previous fix of 7.0865. In the spot market, onshore yuan opened at 7.0873 per dollar and eased to a low of 7.0905 at one point, the weakest since June 9. As of midday, the spot yuan was changing hands at 7.0870, 11 pips weaker than the previous late session close."

10:00 AM

Sensex tumbles over 300 points in opening session; Nifty drops below 9,900

The benchmark indices have started the day on a negative note on the back of selling by foreign investors.

PTI reports: "Equity benchmark Sensex tumbled over 300 points in early trade on Monday dragged by losses in financial stocks amid weak cues from global markets and persistent foreign fund outflow.

After touching a low of 33,384.75, the 30-share index was trading 362.96 points, or 1.07 per cent, lower at 33,417.93.

Similarly, NSE Nifty dropped 96.90 points, or 0.97 per cent, to 9,876.

IndusInd Bank was the top laggard in the Sensex pack, tumbling around 4 per cent, followed by Tata Steel, Bajaj Finance, ICICI Bank, Axis Bank, NTPC, SBI, HDFC Bank and SBI.

On the other hand, Sun Pharma, Infosys, Nestle India and Asian Paints were among the gainers.

In the previous session, the BSE barometer settled at 33,780.89, up 242.52 points, or 0.72 per cent, and the Nifty rose 70.90 points, or 0.72 per cent, to end at 9,972.90.

On a net basis, foreign institutional investors sold equities worth Rs 1,311.49 crore in the capital market on Friday, provisional exchange data showed.

According to traders, negative cues from global markets on fears of a second wave of coronavirus cases and foreign fund outflow hit domestic sentiment here."

 

9:30 AM

Reliance raises ₹1.04 lakh crore from marquee investors in 8 weeks

Billionaire Mukesh Ambani’s oil-to-telecom conglomerate Reliance Industries has raised a record ₹1.04 lakh crore in less than eight weeks from sale of minority stakes in its digital unit Jio Platforms to marquee investors.

On Saturday evening, it announced sale of 0.93% in Jio Platforms to global investment firm TPG for ₹4,546.80 crore and 0.39% to private equity firm L Catterton for ₹1,894.50 crore.

With these, Reliance has now sold 22.38% of Jio Platforms to investors including Facebook Inc, securing ₹1,04,326.95 crore in less than eight weeks, a company statement said.

The investments in Jio Platforms, which comprises the firm’s telecoms arm Reliance Jio Infocomm and its music and video streaming apps, give the unit an enterprise value of ₹5.16 lakh crore, it said.

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9:15 AM

Petrol price hiked by 48 paise/litre, diesel by 23 paise; ninth straight day of increase

The return of dynamic pricing isn't working out well for consumers who have had to foot the bill for higher global crude oil prices.

PTI reports: "Petrol price on Monday was hiked by 48 paise per litre and diesel by 23 paise a litre as oil companies for the ninth day in a row adjusted retail rates in line with costs since ending an 82-day hiatus in rate revision.

Petrol price in Delhi was hiked to Rs 76.26 per litre from Rs 75.78, while diesel rates were increased to Rs 74.26 a litre from Rs 74.03, according to a price notification of state oil marketing companies.

Rates have been increased across the country and vary from state to state depending on the incidence of local sales tax or VAT.

This is the ninth daily increase in rates in a row since oil companies on June 7 restarted revising prices in line with costs, after ending an 82-day hiatus.

In nine hikes, petrol price has gone up by Rs 5 per litre and diesel by Rs 4.87 a litre.

The freeze in rates was imposed in mid-March soon after the government hiked excise duty on petrol and diesel to shore up additional finances."

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Printable version | Jul 7, 2020 9:56:39 PM | https://www.thehindu.com/business/businesslive-15-june-2020/article31830679.ece

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