The auto numbers for the month of October were largely a mixed bag. While Maruti reported a 9.3% growth in passenger vehicles, M&M and Ford India reported a decline in sales numbers as the demand tended to peter out after Diwali. Even Hyundai and Honda reported a marginal fall in sales for the month of October. In the two-wheeler segment both Honda and TVS Motors reported a marginal decline in the sales numbers. Bajaj Auto is yet to report its off-take numbers but it would largely depend on the performance of its exports segment which constitutes nearly 50% of Bajaj sales.
At a time when most tech companies were struggling to keep their head above water, Tech Mahindra has reported a 29.7% growth in profits to RS.836 crore. The company’s revenues were also up by 6.1% at Rs.7606 crore. Tech Mahindra has a strong exposure to the European region and is likely to be a big beneficiary of the Euro zone GDP getting back above the mark. Also Tech Mahindra has a business that is more focused on niche segments like manufacturing, design with a lesser exposure to the core BFSI segment. Tech Mahindra is also making aggressive forays into the digital space.
Manufacturing activity in the month of October was subdued due to a slowdown in new orders in the aftermath of the GST implementation. The PMI Manufacturing for the month of October came in at 50.3, lower than the level of 51.2 for the month of September. A PMI level of above 50 indicates that the manufacturing economy is still in an expansionist mode. However, falling PMI number reflects a loss of momentum in manufacturing. The big worry for the manufacturing sector has been the weakness in inventory accumulation in the aftermath of the uncertainties surrounding GST.
Bharti Airtel has raised its estimates for the full year capital expenditure from Rs.20,000 crore to Rs.25,000 crore. Airtel will hasten the rollout of 4G technology as there was an explosion of data usage and Jio was already beginning to get a stronghold in the data segment. A big chunk of the capex is expected to be infused into radio networks, transmission and fibre backhaul. Many brokerages have turned positive on the stock in the last few weeks after the purchase of Tata Tele mobile business and the profits falling lower than expected. Net profit for the quarter was down by 77% in September.
Largely along expected lines, the Fed decided to maintain status quo on rates. The Fed has reiterated its intent to hike rates by another 25 bps in December followed by 3 rounds of 25 bps hikes in the next calendar year. While Trump’s tax reduction details were expected on Wednesday, the same has been postponed by another day, something that is making the markets quite jittery. The Bank of England is likely to lift rates on the back of robust growth while the ECB appears to slow on its bond purchases on the back of strong GDP data. The big event for the Fed will be the appointment of the new Fed Chair. While Trump has been all praise for Janet Yellen, it is generally expected that Jerome Powell may eventually make the cut. The final announcement is expected before Trump leaves for Asia on 09th Nov.
The world’s first Artificial Intelligence (AI) driven ETF made its debut even as fund managers expressed scepticism about a fund with no human involvement at all. The AI based fund will largely be driven by robots. The Artificial intelligence behind the fund has been rigorously back tested Qraft Technologies of Korea. However, most fund managers have admitted that they are nervous about a fund with no human involvement. There a complex matrix of more than 50 factors that will go into the decision making and has been fine tuned to an extent that the scope for human error is limited.
