| News Announcement |
Impact Analysis |
| Minutes of the MPC clearly hinted at possible rate hikes in 2018 |
- While the vote was 5:1 in favour of status quo, there was an acknowledgement of the inflation risk by all members
- The impact was immediately felt on banks which cracked sharply on Friday on investment loss fears
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| Nokia tax dispute settled under India-Finland mutual treaty |
- The penalty of Rs.2500 crore was later reduced to Rs.1600 crore which has been accepted by Nokia
- With the Nokia issue resolved one can expect an early resolution of the Vodafone and Cairn cases also
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| TCS on course to touch market capitalization of $100 billion |
- The stock was up by 7% after its quarterly results showed a growth of 4.5% and TCS declared 1:1 bonus
- The effect of TCS has already rubbed off on other software stocks too with Infosys and Wipro also gaining
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| The INR cracked beyond the 66/$ mark after holding the level for a long time |
- The panic was caused by Brent Crude prices going beyond $72/bbl with continued tensions in the Middle East
- The fall in INR was caused by banks and importers rushing to cover their open dollar exposures
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| Axis Bank hires Egon Zhender to look out for a new CEO for the bank |
- Shikha Sharma has already expressed her intention to be relieved from the bank as of end of 2018
- This came after the RBI asked the Axis Bank board to cut short her 3 year tenure considering rising NPAs at Axis
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| CBDT and ED seek ban on trading of crypto currencies in India |
- It may be recollected that the RBI in its last monetary policy had already cautioned regulated entities on Bitcoins
- SEBI and RBI had also expressed fears about round tripping of funds using the crypto currency route
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| Vedanta gets Electrosteel at lower than current market valuations |
- Vedanta, the diversified commodities conglomerate, had emerged as the highest bidder for Electrosteel
- The enterprise valuation is at 4.7 times EBITDA, which is cheaper than the industry norm of 6 times EBITDA
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| Former SEBI boss, Damodaran, comes down heavily on governance practices |
- Damodaran called upon the boards and especially independent directors to represent small shareholders
- He was talking with reference to the ICICI case where the board had stood behind the current CEO
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| Iran to switch out of US dollars to Euro for settling foreign trades |
- This could actually inspire a lot of other nations to shift their focus out of the dollar, which has been weakening
- This decision came after the US threatened to re-impose sanctions on Iran and walk out of the Nuclear Deal
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| Salil Parekh of Infosys to buy growth at the cost of margins |
- Parekh has adopted a strategy that is largely at cross purposes with the strategy that Sikka had adopted
- Parekh will also be exiting from Sikka’s expensive buys like the controversial Panaya of Israel
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| Power PSU show little interest in the governments stressed asset plan |
- The government wanted NTPC, PFC and REC to take over the stressed assets of the Indian power sector
- The worry for the government is that 57% of the power debt has an interest coverage ratio of less than 1
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| Rabobank believes that India could be a major loser in the global trade war |
- Rabobank expects India to lose nearly 2.3% of GDP growth in the next few years due to the trade war
- The trade war could actually make India’s exports un-competitive and put pressure on trade deficit
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| CBI questions former BOB chairman in the Rs.2900 crore Rotomac default |
- The pen manufacturer had incurred huge losses after it had diversified into unrelated areas like trading
- The CBI believes that the money was diverted out of India with the connivance of BOB officials
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| Deutsch not to sell its PWM business to IndusInd Bank |
- In a change of heart, Deutsche plans to invest more into the India operations to revive the Indian business
- Deutsche has a €15.20 billion credit exposure to India, which is the second largest in Asia after Japan
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| IMF sees impediments to global growth after the year 2020 |
- IMF expects growth to rise in the next couple of years as an outcome of the Trump tax cuts
- However, post 2020, the cumulative impact of rate tightening will have a negative impact on global growth
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| IMD predicts 2018 rainfall at 97% of long term average (LTA) |
- This is within the normal definition of 96%-104% of LTA as defined by the Met department
- The next and more realistic estimate will come by June when the El Nino effect will also be factored
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| Equity SIPs collected Rs.67,200 crore ($10 billion) in fiscal 2017-18 |
- This represents a 53% growth in SIP collections on a YOY basis largely driven by retail appetite for equity funds
- The drop in the mutual fund expense ratio is likely to further open the gates for SIPs to expand this year
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| Trump identifies Russia, China and India as potential currency manipulators |
- Trump has accused these countries of keeping their currencies deliberately weak to boost exports
- The argument sounds a tad ironic considering that short US dollar was the biggest trade in the last one year
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| Risks of World War III underplayed by the US and Russia |
- While Trump carried out a test attack on Syria, it was not really followed by more attacks
- Even Putin threatened reprisals and counter attacks but stopped short of making any attacks on the Allied forces
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| India’s trade deficit for March 2018 comes in higher at $13.7 billion |
- The trade deficit for the full year 2017-18 was double that of the previous year due to a sharp rise in imports
- India could end the current fiscal year with a sharply higher trade deficit in excess of $200 billion if oil stays higher
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| India’s forex reserves cross the $425 billion mark during the week |
- This puts India along with other Asian miracle economies in the Top-10 in terms of forex chest
- China remains the leader of the pack with a forex chest of nearly $3.50 trillion followed by Japan at $1.2 trillion
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