The Nifty and the Sensex have opened the day on a positive note by scaling fresh highs as in the past few weeks.
Join us as we follow the top business news through the day.
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Sensex rallies 495 points to cross 46k mark for first time; Nifty tops 13,500
Equity benchmark Sensex soared 495 points to cross the 46,000-level for the first time on Wednesday amid persistent foreign fund inflows and positive cues from global markets.
After touching a record intra-day high of 46,164.10, the 30-share BSE index ended 494.99 points or 1.09% higher at 46,103.50 .
Similarly, the broader NSE Nifty rallied 136.15 points or 1.02% to its new record high of 13,529.10. It touched its lifetime peak of 13,548.90 during the day.
Asian Paints was the top gainer in the Sensex pack, rising around 3%, followed by Kotak Bank, Axis Bank, HDFC Bank, Infosys, Reliance Industries and ITC.
On the other hand, UltraTech Cement, Tata Steel, Maruti, SBI and Bajaj Auto were among the laggards.
“Domestic equities remained buoyant with Nifty and Sensex recording fresh highs today mainly supported by sharp rebound in global markets,” said Binod Modi, Head-Strategy at Reliance Securities.
Long, steady auto demand depends on economy, COVID-19 situation: Maruti Suzuki
Outlook for the automobile sector.
PTI reports: "Post-festive car sales have not been as bad as expected with pent-up demand playing a positive role, but long and steady demand in the auto industry will depend on the economy and developments around COVID-19 vaccine, according to a senior official of India’s largest car maker Maruti Suzuki India.
“The auto industry was expecting a large decline in consumer interest in terms of bookings and inquiries. Although there has been a decline, it is marginal and certainly not as much as the expectations or the fear that was in the industry,” Maruti Suzuki India Executive Director (Marketing and Sales) Shashank Srivastava told reporters in an interaction on Wednesday.
He added that in that sense it is a much more positive scenario post-festival than was earlier anticipated. Going by the current trends of booking and inquiries and low stock levels at the dealers and manufacturers, December should be fine, Srivastava said.
According to the Federation of Automobile Dealers Associations, passenger vehicle retail sales in November witnessed a year-on-year rise of 4.17 per cent to 2,91,001 units as Diwali-Dhanteras period led to rise in vehicle registrations, compared with 2,79,365 units in November 2019.
When asked about the road ahead, Srivastava said, “There has been an element of pent-up demand so far. We really don’t know when will it drain out.”
Therefore, he added, the fresh demand, long and steady demand in the auto industry depends completely on the fundamentals of the economy. “There is a very high correlation between auto demand and per-capita growth.”
He said it will also depend on the sentiment surrounding the COVID-19 pandemic.
“On those two factors, there is still some sort of uncertainty although we are hearing positive noises on both fronts as well,” he said. Those were the main reasons “why manufacturers are little apprehensive about giving forward guidance for the next quarter and beyond”, Srivastava added."
Rupee settles 3 paise higher at 73.57 against US dollar
The rupee continues its rise in tandem with stocks.
PTI reports: "The rupee strengthened by 3 paise and settled for the day at 73.57 against the US dollar on Wednesday, supported by foreign fund inflows and heavy buying in domestic equities.
Traders said weakening of the American currency in the overseas market also supported the local unit.
At the interbank forex market, the domestic unit opened at 73.58 against the US dollar and witnessed an intra-day high of 73.49 and a low of 73.61.
The local unit finally closed at 73.57 against the American currency, registering a rise of 3 paise over its previous close.
On Tuesday, the rupee surged by 30 paise to settle at a one-and-a-half month high of 73.60 against the US dollar.
Meanwhile, the dollar index, which gauges the greenback’s strength against a basket of six currencies, was trading 0.24 per cent down at 90.74.
On the domestic equity market front, the BSE Sensex ended 494.99 points or 1.09 per cent higher at 46,103.50, while the broader NSE Nifty jumped 136.15 points or 1.02 per cent to 13,529.10.
Foreign institutional investors were net buyers in the capital market as they purchased shares worth Rs 2,909.60 crore on Tuesday, according to provisional exchange data.
Brent crude futures, the global oil benchmark, rose 1.06 per cent to USD 49.36 per barrel."
IndiGo to reach 80% of normal domestic capacity soon
More signs of the economy moving towards normalcy.
Reuters reports: "India's biggest airline, IndiGo, expects to reach 80% of its usual domestic capacity by the end of the month but international capacity is running at only 20% of normal levels due to the pandemic, its chief executive said on Wednesday.
The airline hopes to reach 100% of normal domestic capacity by early next year and 100% of its usual international capacity by the end of 2021, IndiGo CEO Ronojoy Dutta said at a CAPA Centre for Aviation event."
Manufacturing, services lead recovery: SBI
Recovery in gross domestic product (GDP) has been led by manufacturing and the largest components of the services sector such as trade, hotels, transport and communication, as per a State Bank of India (SBI) report.
The nominal GDP loss narrowed to ₹2 lakh crore in Q2 FY21 from ₹11.1 lakh crore in Q1, according to the report titled ‘Six months after unlock’ released by the economic research department
Manufacturing had minimised its losses by 91% from Q1, services sector by 43% and trade sub-segment by 80%, said SBI.
“This is quite obvious given the movement of freight traffic in Q2,” said Soumya Kanti Ghosh, group chief economic adviser, SBI and the report’s author. “During November, the business activity index showed persistent modest improvement in economic momentum,” said
Weekly food arrival data for November showed a rise in the arrival of cereals and vegetables to some extent but pulses and fruits saw a decline in arrival after recording a modest improvement in October.
No model for sale here, but India's small investors flock to Tesla stock
Interesting new trend amid the stock market frenzy.
Reuters reports: "Mom-and-pop Indian investors increasingly buying U.S. stocks have been drawn to a company that has no presence in India so far: electric car maker Tesla Inc.
Indians are placing bigger-than-ever bets on U.S. stocks this year as the American stock market has recovered faster than markets in India and other emerging nations following a crash sparked by the coronavirus pandemic.
While firms such as Apple, Amazon and Facebook - which have a significant presence in India - are popular among Indian investors venturing into U.S. stocks, data from brokerages shows Tesla has emerged as a new favourite.
Indian brokerage Vested Finance said its accounts held $2.5 million worth of Tesla stock in November, up from just $76,000 at March-end. Another brokerage firm, Stockal, said its clients' Tesla holdings have quadrupled to $10 million during the period.
Tesla shares surged around 450% during that time.
“Some investors have just created accounts to be able to invest in Tesla,” Vested's CEO Viram Shah said. “We would have never imagined that a company which is not even present in India would be the most popular.”
The frenzy around the stock comes as Tesla CEO Elon Musk has signalled an India launch is impending. Musk in October tweeted the electric car maker will foray into India “next year for sure”, and had earlier tweeted about a 2020 launch.
Tesla's plans of a possible launch come when India is becoming focused on promoting the use of electric vehicles, even though Musk has previously flagged concerns around high Indian import duties.
Gaurav Jhunjhunwala, 33, became a Musk fan after reading his biography and has even paid $1,000 in booking fees to get Tesla's Model 3 electric sedan whenever it launches in India. While that wait has been long, he invested $100,000 in Tesla shares in May, and buys 30 shares every other week.
“I just like the way the guy (Musk) thinks,” Jhunjhunwala said. “He is trying to make the world a better place.”"
Heritage Foods exits Future Retail; sells its entire holding for Rs 132 crore
Heritage sells its stake to settle debts.
PTI reports: "Heritage Foods has sold its entire holding representing over 3 per cent stake in Kishore Biyani-led Future Retail for around Rs 132 crore in the open market to mainly repay its long term loans.
“The company has disposed off its entire holdings/investment of 1,78,47,420 equity shares held in Future Retail. These shares were sold through stock exchange in open market in various tranches and the net amount of Rs 131.94 crore was received by the company,” Heritage Foods said in a regulatory filing.
Heritage Foods is promoted by the family members of former Andhra Pradesh Chief Minister N Chandrababu Naidu.
The company said sale proceeds shall be mainly utilised for the repayment of term loans of the company.
In November 2016, Future Group had signed a definitive agreement to acquire Hyderabad-based dairy and retails enterprise, Heritage Foods, in an all stock deal.
As a part of the deal Heritage Foods got 3.65 per cent share-holding in Future Retail through fresh issuance of shares.
In August this year, billionaire Mukesh Ambani’s Reliance Industries announced acquisition of retail and wholesale business and the logistics and warehousing business from the Future Group as going concerns on a slump sale basis for lumpsum aggregate consideration of Rs 24,713 crore.
In October this year, Future Group founder Kishore Biyani had said the homegrown retail major lost nearly Rs 7,000 crore revenue in first three-four months of the COVID-19 pandemic due to closing of stores, which led him to sell his business to Reliance Industries."
TVS Srichakra mulls ₹1000 crore plan to boost output
TVS Srichakra Ltd., a manufacturer of two-and-three wheeler and off-highway tyres, will invest ₹1,000 crore in expanding production capacity of radial tyres and other premium products, according to the company.
The investment, when fully made in Madurai and Pantnagar plants, would result in an increase in two-and-three wheeler tyre capacity by 25-30% and doubling of off-highway tyre capacity. This investment, spread across three years, would be funded by a mix of debt and internal accruals.
“We are further strengthening our manufacturing capabilities to cater to the growing demand in India and abroad,” said S. Ravichandran, director, TVS Srichakra Ltd.
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Amazon eyes potential $100 million investment in India's Apollo Pharmacy - ET
The online pharma space could heat up with Amazon's potential takeover of Apollo Pharmacy.
Reuters reports: "Amazon.com Inc is considering a nearly $100 million investment in India's pharmacy chain Apollo Pharmacy, facing up to Reliance Industries Ltd and Tata Group in the country's fast-growing drug market, the Economic Times reported on Wednesday, citing two people aware of the plans .
Amazon already delivers medicines in India and the potential investment would come amid rising competition from Mukesh Ambani's Reliance, which bought a majority stake in online pharmacy Netmeds.
Tata Group, meanwhile, was reportedly in talks to pick up a majority stake in e-pharmacy firm 1mg.
Both Amazon and Apollo Hospitals, which owns Apollo Pharmacy, did not immediately respond to Reuters request for comments.
The growth of e-pharmacies, however, has left many Indian trader groups feeling threatened, who say online drugstores can contribute to medicine sales without proper verification and the entry of large players can cause unemployment in the sector.
Amazon's plan to further expand in India also comes close on the heels of its launch of an online pharmacy to deliver prescription drugs in the United States, increasing competition with drug retailers such as Walgreens, CVS Health and Walmart."
Rupee surges 11 paise to 73.49 against US dollar in early trade
The rupee strengthened by 11 paise to 73.49 against the US dollar in opening trade on Wednesday, supported by foreign portfolio flows and strong opening in domestic equities.
Traders said weakening of the American currency in the overseas market also supported the local unit.
At the interbank forex market, the domestic unit opened at 73.58 against the US dollar, then gained further ground and touched 73.49, registering a rise of 11 paise over its previous close.
On Tuesday, the rupee surged by 30 paise to settle at a one-and-a-half month high of 73.60 against the US dollar.
“RBI’s presence in the market and a steady US dollar could also keep appreciation bias limited,” Reliance Securities said in a research note adding “dollar inflows into local equities could keep depreciation bias limited”.
Further, investors have turned cautious globally ahead of key events looming for the markets, it said.
Murugappa Group is mentoring only sons: Valli Arunachalam
Valli Arunachalam, the elder daughter of the late M.V. Murugappan, has termed the restructuring exercise at the Murugappa Group ‘unfortunate’ as it failed to keep pace with time in an era when women are an integral part of the workforce.
“All major studies have shown significant economic benefits of having women in leadership positions and it is rather shocking that the Murugappa Group continues to marginalise daughters and mentors only sons for leadership roles,” Ms. Arunachalam said.
Ms. Arunachalam, along with her sister, holds about 8.21% stake inherited from their late father in the ₹38,105-crore Chennai-based group.
“It is very unfortunate that our family branch was not even contacted by the family about restructuring and we learnt about it from the media,” she said, adding that the family branches included in the restructuring were represented by sons.
Indian shares hit record highs on vaccine progress
More good news to boost stocks.
Reuters reports: "Indian shares touched a record high on Wednesday, driven by gains in heavyweight Reliance Industries, as hopes for vaccine approvals in the second worst coronavirus-hit country boosted investor sentiment.
The NSE Nifty 50 index rose 0.69% to 13,485.75 by 0446 GMT and was headed for a seventh consecutive session of gains, while the benchmark S&P BSE Sensex was up 0.72% at 45,938.47. Both have hit record highs in 14 of the last 21 sessions and are up 4% so far in December.
India's federal health secretary said on Tuesday the country may approve some coronavirus vaccines over the next few weeks and an estimated 300 million people would be inoculated in the first tranche.
India has the world's second-highest virus caseload behind the United States, but daily cases have stayed below the 50,000-mark since Nov. 8, despite a busy festival season that saw crowded markets and streets.
“The vaccine news is a sentiment booster. But it is gushing liquidity that is supporting markets, we are seeing risk-on sentiment building up globally,” said Aishvarya Dadheech, fund manager at Ambit Asset Management in Mumbai.
“I believe markets will see traction building over the next 1-1/2 to two years as the economy recovers from the pandemic,” Dadheech said.
Consumer goods giant ITC Ltd climbed 2.3% to its highest since Aug. 11, while index heavyweight Reliance Industries Ltd added 1.1% and top private-sector lender HDFC Bank Ltd rose nearly 1%.
Prestige Estates Ltd rose as much as 4.6% after India's competition regulator approved https://twitter.com/CCI_India/status/1336281154635239426?s=20 the acquisition of some Prestige assets by affiliates of Blackstone Group.
Global equities traded higher on Wednesday, after Britain started mass-vaccinating its people using a fully-tested COVID-19 shot and as Johnson & Johnson said it could obtain late-stage trial results for a single-dose vaccine earlier than expected."
Retail vehicle sales fell 19.3% in November
Total retail vehicle sales across the country fell 19.3% in November to just over 18.27 lakh vehicles from a year earlier. Festive season demand, though, helped passenger vehicles (PVs) show 4.17% growth to 2.91 lakh units in November, as per data released on Tuesday by the Federation of Automobile Dealers Associations (FADA).
However, despite the festive season, two-wheeler and commercial vehicle sales nosedived 21.4% and 31.2%, respectively.
As per FADA, which collected vehicle registration data from 1,265 out of the 1,472 regional transport offices (RTOs), during the 42-day festive seasons, the industry sold more than 4.31 lakh vehicles, showing growth of 13.6% compared with a year earlier.
Tractor sales continued to grow, rising 8.47% to 49,313 units, as against 45,462 units in November 2019.
However, sales of two-wheelers fell to just over 14.13 lakh units from 17.98 lakh units during the month. During the festive period this year, two-wheeler sales declined 6.31% to about 19 lakh units, as against over 20.34 lakh units in the same period of 2019.
