| News Announcement |
Impact Analysis |
| Nifty and Sensex bounces on Friday after falling over 2.5% in the week |
- Markets weakened on the back of weak economic data from China with metals being the major losers
- The proposed $35 billion farm relief package also led to a sharp surge in bond yields and spooked equity markets
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| Fed Watch Tool indicates status quo on rates through calendar year 2019 |
- This could be on the back of pressure from the Trump government to go slow on rate hikes
- In fact, the Fed Watch Tool is also factoring a 6% probability of a likely rate cut post June this year
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| Apple gives weak guidance as sales falter in China and across Asia |
- Apple may be finally feeling the pressure of competitors like Huawei chipping away at its market share in volume terms
- The weakness in Apple guidance led to a 10% correction in the stock leading to a sharp fall in the Dow Jones overall
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| Jet Airways defaults on debt payments as financial crisis deepens |
- Jet urgently needs capital infusion and its stake sale talks have not yet gone through successfully
- Jet is currently negotiating with lenders like SBI to provide interim credit to help them tide over the liquidity crisis
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| Brent crude bounces nearly 8% this week to close above $57/bbl |
- Oil prices reacted positively to China hinting that trade talks between the US and China may resume soon
- Oil also gained from lower levels on expectations that the OPEC may increase its supply cuts to protect price
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| Markets expect GST shortfall for the full year to the tune of Rs.1 trillion |
- The GST collection process is yet to stabilize and compliance is still becoming a major challenge for the GST Council
- A major shortfall in GST revenues will widen the fiscal deficit and force the government to look for alternate sources
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| Gold prices crossed the $1300/oz mark in the international spot market |
- Gold has normally had a negative correlation with the dollar and the dollar weakness is visible
- Gold also becomes a preferred asset class when there is rising political and economic uncertainty in global markets
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| Nifty IT index valuation discount to NASDAQ narrows to 5.6% |
- This is sharply lower than the mean discount of around 34% that Nifty IT index has quoted vis-à-vis NASDAQ
- This could be an indication of the NASDAQ being underpriced or the Indian IT index being overpriced
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| Finance Minister expects PSU banks to recover Rs.70,000 crore by March |
- This is essentially the loan repayments that will come back into the books of PSU banks from the NCLT process
- The banks have already recovered Rs.80,000 crore via NCLT process in the last one year
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| China opens the liquidity taps with 100 bps cut in bank rates |
- The PBOC, the central bank of China, announced this as part of the liquidity enhancement measures
- These are desperate measures and are clearly indicative of the slowdown in growth that China is expecting
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| SEBI comes out with new rules governing issue size change |
- SEBI has called for filing of fresh documents in case the issue size is being changed significantly by more than 20%
- In case of an OFS, the new filing will be required only if the change in issues size more than 50%
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| Air India got Rs.2000 crore from National Small Savings Fund in 2018 |
- The national carrier has been saddled with loans to the tune of Rs.54,000 crore and government is keen to divest it
- More importantly it raises serious questions about the utilization of the funds from the NSSF and its safety
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| NHAI proposes to raise Rs.10,000 crore through issue of Sagarmala Bonds |
- This is part of the full year target of Rs.62.000 crore to be borrowed by the National Highways Authority
- The NHAI has been expanding the highways network aggressively in terms of KM per day
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| Japanese Yen has seen aggressive buying in the last few days |
- Normally, the Yen is considered to be the safest haven due to its consistently large current account surplus
- The previous two occasions this happened in 1998 and 2008, it was in the midst of a huge financial crisis
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| RBI appoints committee under U K Sinha to ease credit to MSMEs |
- The committee will consider ways and means of enhancing the flow of credit to the MSME sector
- This also includes a one-time restructuring of MSME loans to the extent of Rs.25 crores
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| Merger of BOB, Vijaya Bank and Dena Bank gets Cabinet approval |
- The merged entity will be the third largest bank in India in terms of size after SBI and HDFC Bank
- The merger will leave only BOB in existence while other two will merge into BOB through a share swap
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| Sunil Munjal has called for urgent rationalization of 2-wheeler GST |
- Two wheelers are charged GST at 28% and the demand is to reduce this rate to 18% with immediate effect
- The 28% GST rate is applied only to sin products and non-merit luxury goods and 2-wheelers are neither
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| Prices of aviation turbine fuel (ATF) cut by 14.5% on December 01st |
- This comes on top of a 10% cut on November 01st and makes ATF cheaper than petrol and diesel
- The crude prices have fallen by more than 35% in the last 3 months and this should be a relief for airline companies
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| Global fund managers to watch out for trade war and Fed rates in 2019 |
- The trade war is significant as it has larger implications for global growth numbers and for consumer demand
- The Fed rate is likely to determine the direction of the dollar and hawkishness could spook emerging markets
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| Core sector growth came in at a 16 month low level of 3.5% for Nov-18 |
- The core sector was led down by weak output growth in cement and electricity
- Core sector is important because it accounts for nearly 43% of the constituents of the IIP figure
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| All stock derivates to be moved to compulsory delivery by Dec-19 |
- This will ensure that the extent of speculation in stock futures and options will largely reduce in the market
- However, this is unlikely to impact volumes as a large chunk of F&O gets squared up anyway
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