| News Announcement |
Impact Analysis |
| Trump goes ahead with punitive tariffs on $200 billion of Chinese imports |
- Trump went ahead and imposed 25% tariffs on Chinese imports despite trade talks being in progress
- China has promised to retaliate, although it has limited trade levers due to its huge surplus with the US
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| Etihad emerges as lone bidder for Jet Airways on the last day of bidding |
- With hardly any potential buyer showing interest in Jet, it was left to Etihad to put in the sold offer to buy SBI stake
- Most potential buyers backed out after SBI started selling the assets and landing rights of Jet in a piecemeal fashion
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| The sixth round of polling to be conducted on Sunday, May 12th |
- This will be the penultimate round of voting before the final round on 19th and the final outcome on May 23rd
- The five rounds that have been completed have locked in the fate of more than 75% of the total Lok Sabha seats
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| IIP for March 2019 comes in sharply lower at (-0.1%) |
- While this is a point-to-point calculation, there was a clear weakness in the core manufacturing sectors
- Capital goods production saw negative growth of -9% and that is not great news for the capital cycle revival
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| Reuters poll estimates CPI inflation to be closer to 3.3% for April |
- The higher CPI inflation is expected to be due to a combination of higher food prices and fuel inflation
- The CPI inflation will be announced on Monday 13th May and will be a key input for the June monetary policy
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| Tata gives up on its proposed joint venture with Thyssen Krupp |
- The European Commission laid down stringent conditions for the JV which almost made the deal unviable
- As Tata Steel began to search for a new partner for its European steel business, the stock tanked sharply on Friday
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| Apollo Tyres saw a sharp fall net profits on the back of huge write-offs |
- Apollo took a write off of nearly Rs.200 crore given to IL&FS as an ICD, which is virtually irrecoverable now
- Apart from the write-down, Apollo Tyres was also plagued by higher input costs due to steep oil prices
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| MF flows into equity funds fell by 61% in the month of April |
- This fall was despite the SIP collections for April standing at a record Rs.8200 crore on robust retail participation
- However, bulk investing in MFs took a hit and the worst hit were the FMPs where nearly Rs.17,700 crore was taken out
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| Finance Minister admits that the actual fiscal deficit would have been 3.8% |
- If the government had not curtailed expenditure by Rs.1 trillion, the fiscal deficit would have been sharply higher
- The sharp fall in spending was forced by below-par collections in the direct tax front as well as the GST front
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| SBI announces profit but along with rising in provisions |
- Provisions and slippages were higher for SBI, although the Chairman assured of the NPA cycle coming to an end
- SBI still has a lot of uncertainty in its books due to its exposure to IL&FS, Dewan Housing, Essel Group, and Jet Airways
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| Trump tweets destroy global wealth to the tune of $2.1 trillion |
- In the last one week since Trump tweeted the trade war, global equity markets have lost nearly $2.1 trillion
- This is just the loss in market cap not counting the overall losses in trade and GDP growth
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| Crude oil closes the week at $70.62 / bbl, above the support level |
- The oil prices had touched a low of $68.52 after the trade war threatened to weaken demand for oil
- However, inventory drawdowns in the US and the Iran sanctions held up the prices of oil
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| US yield curve inverted again in May after seeing a reverse spread in March |
- The inversion of the yield curve was a result of the 3-month yields on Treasuries going above the 10-year benchmark
- In the past, any inversion of the yield curve has typically led to a recession on 9 out of the 11 occasions
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| EU relies on India and China to sustain its Iran deal |
- EU nations and the UK have been unhappy with the US for imposing stringent sanctions on Iran all over again
- They now rely on India and China, two of the largest Iranian oil buyers, to step in and put pressure on the US
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| Indian aviation growth falters to 3.1% in the month of March 2019 |
- This is a sharp fall in domestic passenger growth from a high of 18% over the last year
- While Jet has constrained supply, other issues like Pratt & Whitney engines and 737 Max issues also contributed
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| Indian banks could recover as much as Rs.80,000 crore this year from IBC |
- This will include the proceeds of Essar Steel and Bhushan Steel & Power, which could not be completed last year
- This write-back could come as a big relief to the Indian PSU banks which continue to be under stress
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| RBI withdraws circular to banks on provisions for IL&FS exposure |
- RBI had issued this circular since NCLT had exempted banks from making provisions for IL&FS exposure
- This had made RBI unhappy but got sorted out after NCLT allowed banks to provide for IL&FS dues
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| Bail plea of Nirav Modi rejected by British Court |
- Lawyers of Nirav Modi could not secure bail for him in the $2 billion fraud and money laundering case in India
- India has sought extradition of Modi to India to face trial, but that may still take more time
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| PMI manufacturing and PMI services come under pressure |
- Why both of them remained above 50 (expansion), the momentum loss was visible in both cases
- The two PMIs put together have a strong impact on the overall IIP growth and the GDP outlook
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| Wilbur Ross looks to re-negotiate with India on trade policy |
- Ross, US Commerce Secretary, had expressed dissatisfaction at India restrictive trade and ecommerce policies
- Simultaneously, the US has refused to give any discounts on oil it forgoes buying from Iran at cheaper rates
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| March quarter has given indications of a slowdown in rural demand |
- This slowdown was visible in results of Hindustan Unilever, Godrej Consumer, and Britannia
- Rural distress has been caused by weak agri prices and benefit of loan waivers not reaching the small farmers
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