Today's top business news: Shares track global gains on Fed rate view, NSE halts trading due to technical glitch, RBI concerned over impact of cryptocurrency on financial stability, and more

After touching a record intra-day high of 50,526.39, the 30-share index ended at 50,255.75, up 458.03 points or 0.92%. File photo for representation.   | Photo Credit: PTI

The benchmark stock indices opened the day on a positive note supported by a host of positive global cues.

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

4:30 PM

BSE, NSE to remain open till 5 pm

Making up for lost time due to technical glitches.

PTI reports: "Leading bourses BSE and NSE said their equity and derivatives markets will remain open till 5 pm on Wednesday.

The move comes after the National Stock Exchange (NSE) suffered an outage earlier in the day due to technical glitches.

"BSE equity and equity derivatives markets will remain open till 5 pm today as decided jointly between exchanges today. All other markets timings will remain as normal," BSE said in a statement.

According to an NSE notification, futures and options (F&O) and normal market operations will resume at 3.45 pm and close at 5 pm.

Earlier in the day, the country's largest stock bourse NSE said trading across segments came to a halt at 11.40 am due to connectivity issues.

The bourse said it depends on two telecom service providers for connectivity, and both failed simultaneously, resulting in the outage.

However, the broader Indian markets were not impacted as communication lines at BSE continued even as NSE faced troubles.

"Expiry eve is a crucial day for expiry related trades as time decay sets in. As indices froze a little after 10 am, F&O trades that reference such benchmark indices also slowed down.

"With hardly an hour's trade possible for such index-based traders the higher margins on F&O positions may have been a double whammy," said Anand James, Chief Market Strategist at Geojit Financial Services.

BSE being open may not have been much solace but certainly a backup avenue for cash traders, he said, adding that VIX had calmed down after Monday's steep fall, and the extended session post 3.45 pm could help settle things.

As of Tuesday, Nifty and Bank Nifty rollovers were at 40.9 and 36.7 respectively, in line with what is usually seen on similar days of previous expiries, he noted."

4:00 PM

RBI concerned over impact of cryptocurrency may have on financial stability: Das

Is a cryptocurrency ban on the cards now?

PTI reports: "The Reserve Bank of India (RBI) is concerned over the impact cryptocurrencies may have on the financial stability in the economy and has conveyed the same to the government, Governor Shaktikanta Das said on Wednesday.

"We have certain major concerns about cryptocurrencies. We have communicated them to the government. It is under consideration in the government and I do expect and I think sooner or later the government will take a call and if required Parliament also will consider and decide," he said in an interview with CNBC-TV18.

"I want to make it clear that the blockchain technology is different. Blockchain technology benefits have to be exploited, that is another thing. But on crypto we have major concerns from the financial stability angle and we have shared it with the government. The government will consider and take a call," Das said.

While Das did not elaborate further, the central bank had in the past expressed concerns on digital currencies being used for money laundering and terror funding.

The government is planning to introduce a bill in Parliament to bar companies and individuals from dealing in cryptocurrencies while creating a framework for an official digital currency.

The RBI had in 2018 banned banks and other regulated entities from supporting crypto transactions after digital currencies were used for frauds. The Supreme Court cut the curbs last year in response to a petition by cryptocurrency exchanges.

Das said the RBI is "very much in the game" and is getting ready to launch its own digital currency.

"Central bank digital currency is work in progress. RBI team is working on it, technology side and procedural side, how it will be launched and rolled out," Das added.

If this happens, the RBI will join other central banks including that of China, where it has electronic yuan.

While no date for the rollout has been set, the project is "receiving our full attention" and the central bank is "tying up several loose ends", Das said.

On inflation targeting, the governor said the central bank's internal working group will come out with its report on the target band in the next few days.

The Monetary Policy Framework, which mandates the Reserve Bank to maintain consumer price index or retail inflation at 4 per cent in a band of (+/-) 2 per cent, is coming up for review in March end.

"That (internal working group) report will be out very, very shortly, in the next few days. As far as flexible inflation targeting is concerned, this was a major structural reform undertaken by the government in 2016 and over the last 5 years the gains of this structural reform is visible," he told CNBC-TV18.

Finance Minister Nirmala Sitharaman had last week stated that the government would review the inflation target band as the five-year term for the Monetary Policy Committee (MPC) is coming to an end.

The six-member MPC, headed by the RBI Governor, decides on the monetary policy keeping in mind this inflation target band.

Counting the benefits of the monetary policy framework, Das said inflation expectations of households and businesses are well anchored and stability of inflation confidence to both domestic and foreign investors.

"But for these COVID months when it crossed 6 per cent, inflation expectations have been well anchored. And when inflation expectations are anchored and inflation remains around the target of 4 per cent ... it benefits the household, economy also... Also the other aspect is that the current framework has enough width 4 (+/- 2) per cent to deal with extraordinary situations, like the COVID...

"I would believe that the current framework has.... achieved a lot and these gains have to be preserved, consolidated and not jarred," Das said.

In the current fiscal, the retail inflation has hovered above the upper end of the target band of 6 per cent for the most part of the year and came back within 6 per cent limit in December 2020. In January 2021, it fell to a 16-month low of 4.06 per cent.

Das said in the near term, inflation would remain benign below 6 per cent, even though core inflation remains elevated at around 5-5.5 per cent.

"Since inflation expectation, today is well anchored, I do not expect suddenly inflation to spike because the Reserve Bank has necessary tools to monitor it very carefully and whatever projections we have given at this point of time, we stick to those projections. So in the near-term... the inflation is going to remain well within the 6 per cent upper threshold," Das said.

The RBI has projected retail inflation in the April-September period of next fiscal to be 5.2-5 per cent, and for the October-December period to be 4.3 per cent.

With regard to the budget announcement of privatisation of two public sector banks, Das said it is a major reform that the government has embarked upon and there is a constant dialogue with the RBI.

"We are directly concerned with two aspects. One is the 'Fit and Proper' criteria. The new owner should meet the criteria. We would be very keen that the bank, post takeover, is well capitalised and the promoter who takes it over has enough financial strength to capitalise the bank significantly," Das said, adding that amendment to Bank Nationalisation Act would be required.

The Reserve Bank had earlier this month said that it will allow retail investors to invest directly in Government securities (G-Sec) markets.

Asked about the timeline, Das said, "It is a work in progress, there is a technology aspect also. We will be issuing guidelines in the next few weeks.""

2:00 PM

India's cenbank, markets must work together, governor says

An important call from the RBI governor.

PTI reports: "India's central bank and markets need to work together to ensure the orderly evolution of the bond yield curve, the Reserve Bank of India governor told news channel CNBC-TV18 on Wednesday.

Bond yields have seen an upward bias since the government announced, in its budget this month, additional market borrowing for the current financial year and higher than expected borrowing for the fiscal year starting in April.

Investor appetite has been low despite the central bank's assurance that it would provide ample liquidity and ensure a smooth government borrowing programme as traders seek more direct support from the RBI.

"It entails a responsibility for the central bank and for the market players. So what we are looking at is an orderly evolution of the yield curve. I think I have given reasonable amount of clarity to the market," RBI Governor Shaktikanta Das said.

The benchmark 10-year bond yield was unchanged at 6.17% after the RBI chief's comments but is up 22 basis points since its low last week."

1:30 PM

Exim Bank extends USD 100 million loan to Mauritius on behalf of India

A bid to boost defence exports.

PTI reports: "Exim Bank on Wednesday said it has extended USD 100 million loan to Mauritius on behalf of India for defense-related procurements.

Export-Import Bank of India (Exim Bank), on behalf of the Government of India, has extended a line of credit (LOC) of USD 100 million to the Government of the Republic of Mauritius for the purpose of financing procurement of defense items from India, Exim Bank said in a release.

The LOC agreement for this was signed on February 19, 2021, through exchange between Renganaden Padayachy, Minister of Finance, Economic Planning and Development, Mauritius and Gaurav Singh Bhandari, Chief General Manager, Exim Bank.

With the signing of this loan agreement, Exim Bank till date has extended six LOCs to Mauritius, on behalf of India, taking the total value of LOCs extended to USD 764.80 million.

The soft loans to Mauritius cover projects in sectors including defense, connectivity and infrastructure sectors such as Metro Express Limited, Social Housing, among others, Exim Bank said.

Also, with this loan pact, Exim Bank has now in place 269 LOCs, covering 62 countries in Africa, Asia, Latin America and the Commonwealth of Independent States (CIS), with credit commitments of around USD 26.64 billion, available for financing exports from India.

Besides promoting India's exports, Exim Bank's LOCs enable demonstration of Indian expertise and project execution capabilities in emerging markets, said the lender."

1:00 PM

Trading halts on NSE due to connectivity issues

Technical difficulties at the stock exchange.

PTI reports: "Largest stock bourse NSE on Wednesday said trading across segments came to a halt at 1140 hrs due to connectivity issues.

The bourse said it depends on two telecom service providers for connectivity, and both failed simultaneously resulting in the outage.

However, the broader Indian markets were not impacted, as communication lines at BSE continued even as NSE faced troubles.

"NSE has multiple telecom links with two service providers to ensure redundancy and we have received communication from both the telecom service providers that there are issues with their links due to which there is an impact on NSE system," a statement from NSE spokesperson said.

"We are working on restoring the systems as soon as possible. In view of the above all the segments have been closed at 11.40 and will be restored as soon as the issue is resolved," it added.

In June 2020, NSE had suffered a technical glitch. At that time, its bank option segment prices were not reflecting on the terminal linked to the exchange.

In September 2019 too, the bourse's system faced a trading outage as investors were unable to place orders in the final minutes of the trade."

12:30 PM

SMC Global Securities lists equity shares on NSE, BSE

Another company makes its debut in the stock market.

PTI reports: "Equity shares of SMC Global Securities on Wednesday got listed at Rs 90.90 on NSE and Rs 91.60 on BSE.

SMC Global Securities was already listed on regional stock exchanges. As per Sebi guidelines, the company through direct listing process got listed on NSE and BSE without any public issue.

The company already has a public shareholding of around 38 per cent.

"The shares got listed at Rs 90.90 on NSE and Rs 91.60 on BSE," SMC Global Securities said in a release.

"It gives us immense pleasure to on board SMC Global on the NSE main board platform. We are confident that the company in the broking industry has a major role to play in having financial inclusion and ongoing digital revolution," said Vikram Limaye, MD and CEO, National Stock Exchange.

"We have well diversified public shareholding and this listing provides liquidity to our shareholders... This landmark marks a step forward in our aspiration to become a global organisation having a dominant position in the financial and investment services through customer centric approach," said Subhash C Aggarwal, SMC Global Securities.

Established in 1994, SMC Global Securities is a financial services provider offering diversified financial services.

It has presence across over 550 cities in India through a network of 95 branch offices including one overseas office at Dubai, further backed by over 2,500 sub-brokers/authorised persons and more than 13,700 independent distributors."

12:00 PM

Maruti Suzuki drives in new Swift at ₹5.73 lakh

Maruti Suzuki on Wednesday announced the launch of all-new Swift 2021, with price starting from ₹5.73 lakh and going up to ₹8.41 lakh (ex-showroom Delhi).

“Since its launch in 2005, Swift has revolutionised the premium hatchback segment in India. Swift with its sporty performance, upright stance and unmistakable road presence emphasizes individuality that stands out from the crowd. This ‘coming of the age’ car was designed keeping in mind the evolved preferences of the modern day customer,” Shashank Srivastava, Executive Director (Marketing & Sales), Maruti Suzuki India said.

Mr. Srivastava added that over the years, Swift has had nearly 2.4 million customers.

The new Swift is equipped with ‘Next Gen K-Series Dual Jet Dual VVT engine with Idle Start Stop (ISS) technology and promises to fuel efficiency of 23.20 km/l in manual transmission (MT) and 23.76 km/l in automatic gear shift (AGS) variants.

 

11:30 AM

Tata Consumer Products hit 52-week high value on inclusion in Nifty50 from Mar 31

Price momentum is helping a Tata subsidiary.

PTI reports: "Shares of Tata Consumer Products on Wednesday surged over 4 per cent to hit 52-week high values on exchanges after National Stock Exchange (NSE) said it will be included in Nifty 50 from March 31.

On BSE, the stock was trading 4.09 per cent higher at Rs 652.85, its 52-week high value.

Similarly on NSE, the scrip was trading at its 52-week high value of Rs 654, rising 4.22 per cent.

As per a release, the bourse on Tuesday said there will be replacements in 36 indices, including Nifty 50, from March 31.

In Nifty 50, Tata Consumer Products will replace GAIL from March 31.

The exchange's Index Maintenance Sub-Committee (Equity) decided to make replacements in the indices as part of its periodic review."

11:00 AM

Rupee gains 14 paise to 72.32 against U.S. dollar in early trade

The rupee appreciated by 14 paise to 72.32 against the U.S. dollar in opening trade on Wednesday supported by positive domestic equities and weakness of the American currency in the overseas market.

Forex traders said the Fed Chairman Jerome Powell’s dovish statement on the U.S. economy also boosted investor sentiment.

At the interbank forex market, the local unit opened at 72.35 against the U.S. dollar, then inched higher to 72.32 against the greenback, registering a rise of 14 paise over its previous close.

On Tuesday, the rupee had settled at 72.46 against the American currency.

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10:30 AM

Pharma exports to Arab nations cumbersome, says Sanjay Bhattacharyya

India has urged Arab countries to make it easier to export pharmaceutical products to the region and asked them to tap Indian farms to secure food supplies, as it seeks to diversify the $160 billion trade basket with the Arab bloc beyond hydrocarbons.

“Indian pharma products enjoy great credibility around the world, [but] we do not have the same kind of recognition in most of the Arab world, because the process through which medicines are brought into your countries are very elaborate and cumbersome at times,” said Ambassador Sanjay Bhattacharyya, Secretary (Arab, OIA & CPV), Ministry of External Affairs.

Mr. Bhattacharya said market access to Indian pharma goods could be an ‘early harvest’ idea ahead of the India-Arab Partnership forum scheduled in the first week of December, after a gap of five years.

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10:00 AM

Indian shares track global gains on Fed rate view; Reliance shines

Global monetary policy continues to drive stocks.

Reuters reports: "Indian shares rose on Wednesday as global risk appetite was boosted by the U.S. Federal Reserve's promise of cheap money, with index heavyweight Reliance Industries and private sector lenders leading the pack.

The NSE Nifty 50 index was up 0.77% at 14,820.45 by 0450 GMT, while the S&P BSE Sensex gained 0.63% to 50,061.21.

MSCI's broadest index of Asia-Pacific shares outside Japan climbed 0.3% after the Fed said the U.S. central bank intended to keep monetary policy loose for a long time.

"The global liquidity backdrop continues to be positive since the Fed has reaffirmed its accommodative monetary stance," said V.K. Vijayakumar, chief investment strategist at Geojit Financial Services.

In Mumbai, Reliance Industries, ICICI Bank and HDFC Bank were top boosts to the Nifty, rising more than 1% each.

The Nifty private bank index climbed as much as 1.4% and was set to snap a six-session losing streak, while the PSU bank index jumped 3.5% after seeing heavy sell-offs in the last three sessions.

Indian equities rose sharply in the first two weeks of February thanks to solid corporate earnings and a well-received federal budget, before trimming some of the gains due to profit-taking.

On Tuesday, benchmark stock indexes snapped five sessions of losses as a rise in commodity prices supported gains in energy and metal stocks.

Shares of Coal India rose 5.4% on Wednesday and were the top percentage gainers on the Nifty.

Among the 14 major sub-indexes on the Nifty, IT and FMCG were in negative territory, falling 1.2% and 0.3%, respectively.

IT giant Tata Consultancy Services was the top drag on the Nifty, shedding nearly 2%.

UPL fell 3.6% after the agrochemical maker said on Tuesday a fire at its plant in the western state of Gujarat killed two and injured 26."

9:30 AM

China steel: Govt. starts probe to review anti-dumping duty

The Commerce Ministry’s investigation arm DGTR has initiated a probe to review the need for continuing imposition of anti-dumping duty on certain types of steel products imported from China following complaints from domestic industry, according to a notification.

ISMT Ltd. and Jindal Saw Ltd. have filed an application before the Directorate General of Trade Remedies (DGTR) for a sunset review of anti-dumping duty imposed on imports of seamless tubes, pipes and hollow profiles of iron, alloy or non-alloy steel from China.

The applicants have alleged that dumping of these products from China has continued even after imposition of anti-dumping duty, and there has been a significant increase in the volume of imports.

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Printable version | Apr 18, 2021 6:32:38 AM | https://www.thehindu.com/business/businesslive-24-february-2021/article33919613.ece

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