Today's top business news: Stocks end flat, fuel prices hiked for 19th straight day, Indian exports held up by Chinese officials, and more

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

The weakness that hit stocks yesterday continued to prevail today with the benchmark indices suffering modest losses.

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

4:30 PM

Bond investors bet on interest rates staying low forever

 

4:00 PM

Sensex, Nifty end marginally lower on F&O expiry

Equity benchmarks Sensex and Nifty ended marginally lower on Thursday after a volatile session amid expiry of monthly derivative contracts.

Weak cues from global markets also weighed on investor sentiment here, traders said.

After swinging 581.83 points during the day, the 30-share BSE Sensex settled 26.88 points, or 0.08 per cent, lower at 34,842.10. It touched an intra-day high of 35,081.61 and a low of 34,499.78.

Similarly, the NSE Nifty slipped 16.40 points, or 0.16 per cent, to close at 10,288.90. During the day, it hit a high of 10,361.80 and a low of 10,194.50.

Read more

3:50 PM

India’s exports likely to dip 10-12% in 2020-21: FIEO

As countries turn towards lockdowns and protection of borders to prevent the import of coronavirus cases, exports suffer.

PTI reports: "The country’s exports are likely to witness a 10-12 per cent year-on-year decline during the ongoing fiscal, if the current trend persists, due to the contraction in global demand on account of the COVID-19 pandemic, FIEO said on Thursday.

Federation of Indian Export Organisations (FIEO) President S K Saraf said although exporters are receiving a lot of enquiries from countries where anti-China sentiments are high, demand in employment intensive sectors like gems and jewellery, apparels, footwear, handicrafts, and carpets is still a challenge.

“Initially, looking into the lockdown challenges and projected decline in global trade, we expected 20 per cent decline in our exports. However, two days back, the WTO (World Trade Organisation) trade estimates for the second quarter puts the contraction only at 13 per cent,” Saraf told reporters during a video conference briefing.

”...We do not expect much improvement in demand. Therefore, we expect around 10 per cent-12 per cent decline in India’s exports in the current fiscal,” he added.

However, in case of a second wave of the pandemic, the contraction in exports may reach 20 per cent, Saraf said.

India’s exports contracted by a record 60 per cent in April and 36.47 per cent in May.

Saraf also suggested the government to focus on concluding free trade agreements with countries like the European Union, Australia and New Zealand."

3:30 PM

Exporters raising concern over consignment hold-up by Hong Kong, Chinese customs: FIEO

Here's more news on the trade tensions between India and China.

PTI reports: "Some exporters have raised concerns over consignments being held back by Hong Kong and Chinese customs in response to a similar action being taken by Indian authorities at Chennai port, FIEO said on Thursday.

The matter assumes significance in the wake of border tensions between India and China at Galwan Valley in eastern Ladakh.

“We have been given to understand that customs is physically examining all imports from China which is delaying clearance, adding to the cost of imports,” Federation of Indian Export Organisations (FIEO) President S K Saraf said in a letter to Commerce Secretary Anup Wadhawan.

He said that some exporters have informed that, in response to such action, Hong Kong and Chinese customs are also holding back export consignments from India.

Saraf urged the Commerce Ministry to take up the matter with Central Board of Indirect Taxes and Customs (CBIC) to see whether any official communication has been sent to Indian customs regarding scrutiny of Chinese consignments here.

“Kindly take it up with CBIC and, if no such instructions have been given, a denial may be issued by CBIC so that the matter may be communicated to our importers in China and Hong Kong to suitably take up with their customs explaining our stand,” he added.

Later, briefing reporters on the issue, Saraf said: “We have found that at Chennai and Mumbai ports, Indian customs are opening and checking all containers of China, although there is no written instruction or circular from CBIC regarding that“.

He added as the federation has taken up the matter with government, expects that the issue will be resolved soon.

Saraf also said that FIEO is against putting a blanket ban on imports of Chinese goods as it would have implications on domestic industry and consumers both."

3:00 PM

Rupee settles 7 paise higher at 75.65 against US dollar

The rupee erased its initial losses and settled 7 paise higher at 75.65 (provisional) against the US dollar on Thursday tracking positive domestic equities and foreign fund inflows.

Forex traders said, the rupee traded in a narrow range as gains in domestic equities, easing crude oil prices and foreign fund inflows supported the market, while strong US dollar and rising coronavirus cases weighed on investor sentiments.

The rupee opened at 75.76 against the US dollar, but gathered strength and closed at 75.65, higher by 7 paise over its previous close.

It had finished at 75.72 against the greenback on Wednesday.

Read more

 

2:30 PM

RIL-Facebook deal gets CCI approval

The Competition Commission of India (CCI) has given approval to Reliance Industries Limited’s $5.7 billion deal with Facebook , even as RIL is working to close its $15 billion deal with world’s largest oil firm Saudi Aramco. “CCI has approved acquisition of 9.99% stake in Jio Platforms by Jaadhu Holdings LLC,” the competition watchdog announced on its Twitter handle on Wednesday.

RIL, Jio Platforms and Facebook Inc. signed binding agreements for an investment of ₹43,574 crore by Facebook into Jio Platforms.

“This partnership is aimed at accelerating India’s all-round development, fulfilling the needs of Indian people and the Indian economy. The joint focus will be to digitally enable and empower India’s 60 million MSMEs, 120 million farmers, 30 million small merchants and millions of SMEs in the informal sector, in addition to empowering people seeking various digital services,” RIL chairman Mukesh Ambani said in his letter to shareholders.

Read more
 

2:00 PM

Boycott of Chinese goods may not be feasible, says Indian export body

Even as political tensions rise between India and China, cutting off trade ties may not be easy.

Reuters reports: "Boycotting Chinese goods may not be feasible as India is dependent on Chinese imports but New Delhi should try to reduce its dependence on Chinese products, the chief of the Federation of Indian Export Organisations said on Thursday.

After a border clash with China in which 20 Indian soldiers were killed, there are growing calls in India to shun Chinese products.

India's customs officials at Chennai, one of India's biggest ports, have held shipments originating from China for extra checks."

1:30 PM

Just how cheap are stocks today?

 

1:00 PM

All transactions fully protected under RBI, NPCI guidelines: Google Pay

Google Pay on Wednesday said all transactions made through its platform are fully protected by redressal processes laid out in the guidelines issued by the Reserve Bank of India and the National Payments Corporation of India.

The statement comes against the backdrop of social media buzz that issues that might arise while transferring money through Google Pay cannot be redressed under law as the app is unauthorised.

“Some quotes on social media, wrongly attributed to the RBI, claim that issues arising while transferring money through Google Pay are not protected by the law, since the app is unauthorised. This is incorrect and can be verified on NPCI’s website,” a Google spokesperson said.

Read more

12:30 PM

Indian shares adrift as gains in defensives even out dour IMF outlook

An update on how stocks performed in the morning session.

Reuters reports: "Indian stocks swung between gains and losses on Thursday after the International Monetary Fund slashed its growth outlook for the country and forecast a deeper global recession, with gains in consumer and pharma stocks offsetting losses.

The IMF on Wednesday evening predicted the Indian economy would contract by 4.5% in 2020. It also expects global output to shrink 4.9% this year, a sharper fall than the 3% contraction predicted in April.

The NSE Nifty 50 index rose 0.1% to 10,320 and the benchmark S&P BSE Sensex was also up 0.1% at 34,924.05 as of 0506 GMT. Both the indexes fell 1% early in the session.

“What is compensating the growth downgrades and surge in virus cases is liquidity. There is hope that the central bankers will continue liquidity infusing policies,” said Mayuresh Joshi, head of equity research at William O'Neil India in Mumbai.

“When markets turn volatile, investors turn to defensive stocks like pharma and consumer,” he added.

The Nifty fast moving consumer goods index rose 1.1%, while the pharma index gained 0.53%.

The FMCG and pharma indexes have gained 3.8% and 1.7% so far this week, respectively, compared with a 0.6% gain in the heavy weight Nifty Bank index.

Investors were also closely monitoring a surge in coronavirus cases globally, analysts said.

Domestic coronavirus virus cases surged over 473,000, while some U.S. states reported record increase in new cases on Wednesday and Australia posted its biggest daily rise in infections in two months.

Indian indexes are expected to be volatile on Thursday ahead of the monthly expiry of futures and options contracts."

12:00 PM

Coronavirus is the new trade war

 

11:40 AM

Photo finish: end of an era as Olympus sells camera division

It's the end of an era: Japan's Olympus said Wednesday it is selling its struggling camera division to focus on medical equipment — now the major portion of the storied firm's business.

Olympus has been in the camera business since 1936, when it launched a product using the "Zuiko" lens, but it has struggled along with industry rivals as demand for traditional cameras declines, with consumers relying on increasingly sophisticated smartphone cameras.

The company said it has signed a memo of understanding to transfer its camera business to investment fund Japan Industrial Partners, with the goal of sealing a final deal by the end of September.

Read more
 

11:30 AM

Oil dives over 5% as U.S. crude stocks hit record, COVID cases mount

Could oil prices soon be facing a deja vu moment?

Reuters reports: "Oil prices tumbled over 5%, or more than $2 a barrel on Wednesday, after U.S. crude storage hit another record and coronavirus cases rebounded in countries like Germany and surged in heavily populated areas of the United States.

The United States had its second-largest rise in infections since the pandemic began. Mounting infections there as well as in China, Latin America and India have unnerved investors and pressured oil prices.

“The market is signalling that if it doesn't get constant reassurance that we are emerging from the breakdown in demand that happened because of the pandemic, then higher oil prices really don't make sense,” said Gene McGillian, vice president of market research at Tradition Energy in Stamford, Connecticut.

Brent crude settled at $40.31 a barrel, down $2.32, or 5.4%. On Tuesday, Brent hit its highest price since early March, just before the pandemic and Saudi-Russia price war roiled markets.

U.S. West Texas Intermediate (WTI) crude settled at $38.01 a barrel, losing $2.36, or 5.8%.

A stronger U.S. dollar, which moves inversely with oil, and a slump in equities also weighed on prices.

U.S. crude oil inventories swelled last week by 1.4 million barrels, exceeding expectations for a 299,000-barrel rise, the Energy Information Administration said.

That marked the third straight record for crude in U.S. storage.

The International Monetary Fund said the pandemic is causing wider and deeper economic damage than first thought, and it slashed its 2020 global output forecasts further.

India's oil imports in May hit the lowest since October 2011 as refiners with brimming crude inventories cut purchases.

China, the world's top crude importer, is also expected to slow imports in the third quarter, after record purchases in recent months."

11:00 AM

Rupee slips 4 paise to 75.76 against US dollar in early trade

The initial weakness in domestic equities weighed on the rupee this morning.

PTI reports: "The rupee depreciated 4 paise to 75.76 against the US dollar in early trade on Thursday as weak domestic equities coupled with strong US dollar and rising coronavirus cases weighed on investor sentiments.

Forex traders said investor sentiment weakened after the US threatened new tariffs on European imports amid escalating trade war fears. Besides, border tension with China and rising COVID-19 cases dragged down the local unit.

The rupee opened at 75.76 against the US dollar, down 4 paise over its previous close.

It had settled at 75.72 against the greenback on Wednesday.

“The risk sentiment was soured as US trade representative has proposed imposing tariffs on USD 3.1 billion of imports from France, Germany, Spain and the UK. The proposal has been put out to seek public opinion until July 26,” said Abhishek Goenka, Founder and CEO, IFA Global.

Besides, the IMF has cut its projections for world economic growth. It now sees an even deeper recession and slower recovery than earlier, Goenka added.

Meanwhile, the dollar index, which gauges the greenback’s strength against a basket of six currencies, rose 0.13 per cent to 97.27.

The 30-share BSE benchmark Sensex was trading 144.68 points lower at 34,724.30 and broader NSE Nifty fell 27.60 points to 10,277.70.

Foreign institutional investors were net buyers in the capital market as they bought shares worth Rs 1,766.90 crore on Wednesday, according to provisional exchange data."

10:40 AM

Diesel crosses Rs 80-mark in Delhi after 19th consecutive price hike

It looks like consumers will continue to face the heat of rising domestic fuel prices.

PTI reports: "Diesel price in the national capital crossed the Rs 80 per litre-mark for the first time ever on Thursday as oil companies raised prices for the 19th day, taking the cumulative rate to Rs 10.63 a litre.

Petrol price, after a day’s hiatus, was hiked by 16 paise and the increase in less than three weeks now totals Rs 8.66 per litre.

Petrol price in Delhi was hiked to Rs 79.92 per litre from Rs 79.76, while diesel rates were increased to Rs 80.02 a litre from Rs 79.88, according to a price notification of state oil marketing companies.

Diesel had for the first time become costlier than petrol in Delhi on Wednesday and has now crossed the Rs 80 per litre-mark.

Rates differ from state to state depending on the incidence of value-added tax (VAT).

However, diesel is costlier than petrol only in the national capital where the state government had raised local sales tax or VAT on the fuel sharply last month. It costs less than petrol in other cities.

The 19th daily increase in rates since oil companies on June 7 restarted revising prices in line with costs after ending an 82-day hiatus in rate revision, has taken diesel prices to fresh highs.

In 19 straight days, diesel price has gone up by Rs 10.63 per litre. Petrol price has been hiked on 18 occasions since June 7 and now totals to Rs 8.66 a litre."

10:20 AM

IMF projects sharp contraction of 4.5% in Indian economy in 2020

The IMF on June 24 projected a sharp contraction of 4.5% for the Indian economy in 2020, a “historic low,” citing the unprecedented coronavirus pandemic that has nearly stalled all economic activities, but said the country is expected to bounce back in 2021 with a robust 6% growth rate.

The International Monetary Fund (IMF) projected the global growth at -4.9% in 2020, 1.9 percentage points below the April 2020 World Economic Outlook (WEO) forecast.

“We are projecting a sharp contraction in 2020 of -4.5%. Given the unprecedented nature of this crisis, as is the case for almost all countries, this projected contraction is a historic low, Indian-American Gita Gopinath, IMF’s Chief Economist, told PTI as she released the World Economic Outlook Update in Washington.

Read more
 

10:00 AM

Sensex falls over 300 points in early trade ahead of F&O expiry

The benchmark indices that ended their four-day winning streak yesterday are showing more weakness this morning.

PTI reports: "Equity benchmark Sensex tumbled over 300 points in early trade on Thursday tracking losses in index-heavyweights HDFC twins, Infosys and ICICI Bank ahead of the expiry of June derivatives.

Weak cues from global markets also weighed on investor sentiment here, traders said.

After touching a low of 34,499.78, the 30-share index was trading 343.59 points, or 0.99 per cent, lower at 34,525.39.

Similarly, NSE Nifty fell 99.10 points, or 0.96 per cent, to 10,206.20.

Infosys was the top loser in the Sensex pack, shedding around 3 per cent, followed by HDFC Bank, Axis Bank, IndusInd Bank, Asian Paints, ICICI Bank and HDFC.

On the other hand, Bajaj Auto, ITC, NTPC, UltraTech Cement and Reliance Industries were among the gainers.

In the previous session, the BSE barometer closed at 34,868.98, down 561.45 points, or 1.58 per cent, and the broader Nifty tumbled 165.70 points, or 1.58 per cent, to end at 10,305.30.

On a net basis, foreign institutional investors bought equities worth Rs 1,766.90 crore on Wednesday, provisional exchange data showed.

According to traders, expiry of June futures and options (F&O) contracts and border tension with China has added volatility to the market."

 

9:45 AM

Trump’s H-1B policy detrimental to U.S. economy: USIBC

The temporary suspension of H-1B and other non-immigrant visas by President Donald Trump along with other restrictive policies on immigration is detrimental to the United States and its economy, president of a top American business advocacy group has said.

It (the proclamation) is unfortunate, Nisha Desai Biswal, president of U.S. India Business Council (USIBC) told PTI in an interview.

Mr. Trump had earlier this week issued a proclamation to suspend issuing of H-1B visas, popular among Indian IT professionals, along with other foreign work visas for the rest of the year.

Read more
 

9:30 PM

Gold eases off multi-year peak as virus surge drives cash hunt

A temporary blip in gold's rise as investors rush to cash amid the stock sell-off.

Reuters reports: "Gold edged lower on Thursday, easing off a near eight-year high hit in the last session, as a selloff in equity markets driven by a surge in coronavirus cases prompted some investors to dump assets.

Spot gold was down 0.1% at $1,760.39 per ounce as of 0307 GMT, having soared to its highest level since October 2012 of $1,779.06 on Wednesday. U.S. gold futures fell 0.2% to $1,771.80.

“The behavioural pattern we've seen this year is that when stocks and energy fall, there is a rush for cash across all asset classes, including gold,” said Jeffrey Halley, senior market analyst at OANDA. However, he added, “any short-term correction is likely to be a slow grind lower, and not a rush for the exit doors,” as safe haven buying and low interest rates provide support for bullion.

Indicative of gold's overall appeal, which has driven a 16% jump in prices this year, holdings of the world's biggest gold-backed exchanged traded fund, the SPDR Gold Trust , hit their highest in over seven years.

Asian stock markets fell on surging U.S. coronavirus cases and an International Monetary Fund downgrade to economic projections, driving inflows into alternate safe haven dollar. Gold has, on occasion, moved in tandem with equity markets this year, with steep selloffs driving a rush for cash and as traders met margin calls."

 

Recommended for you
This article is closed for comments.
Please Email the Editor

Printable version | Jul 9, 2020 11:13:40 PM | https://www.thehindu.com/business/businesslive-25-june-2020/article31911417.ece

Next Story