| News Announcement |
Impact Analysis |
| Nirmala Sitharaman announces relief for FPIs and NBFCs |
- The government has officially announced that the capital gains will be exempt from the tax surcharge
- In a push to NBFCs, the government gave another Rs.30,000 crore to HFCs and agreed to lenient lines of credit
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| Finance Minister also provides a boost to the automobile sector |
- Automobiles get higher depreciation of 30% as against current 15% plus assurance of easy funding from NBFCs
- Government also considering a scrappage policy as well as commencing purchase of cars by government departments
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| Trade war rhetoric sharpens between China and the United States |
- China triggered the war this time around by announcing higher import tariffs on US imports worth $75 billion
- In response, Trump has asked US companies manufacturing in China to look out for alternative options
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| Wall Street drops by 2% as the trade war intensified on Friday |
- Ahead of a tentative weekend, Wall Street indices cracked sharply after Trump promised to retaliate
- The US and China have a combined GDP of $36 trillion and the world cannot really afford these countries sparring
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| Oil prices in the Brent Market slide sharply on worsening trade war |
- With the trade war looking to worsen, the Brent Crude prices fell decisively below the $60/bbl mark on Friday
- The renewed trade war has again raised concerns of a real slowdown in the world GDP and that is negative for oil
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| Rupee touches a low of Rs.72/$ during the week but bounces back |
- The rupee corrected sharply during the week after China dropped the Yuan mid-point for the second time
- With Chinese Yuan falling to nearly CNY7.10/$, the Indian rupee came under pressure, losing 6% in August
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| In a boost to start-ups, the government announced a slew of measures |
- The government has now confirmed that Section 56 (2)B pertaining to angel tax has been scrapped
- Government has also instructed CBDT to set up a separate start-up cell to handle tax related issues quickly
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| Jerome Powell maintains cautious stance at Jackson Hole |
- The Fed Chairman, in his address to the Jackson Hole Symposium stopped short of committing to rate cuts
- Obviously, Trump has not been too happy with the cautious attitude of the Fed and is looking at more aggressive cuts
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| Chris Wood of CLSA cuts India overweight by 100 bps due to Kashmir |
- Wood pointed out that the ongoing situation in Kashmir was creating geopolitical risk in the South Asian region
- However, CLSA continues to be overweight on India vis-à-vis the model portfolio created by the MSCI EM index
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| Indian rupee emerges the worst performing EM currency in Asia |
- Indian rupee corrected more than 6% versus the dollar since the beginning of August on FPI selling and dollar strength
- The correction in the INR was the worst among EMs; sharper than the Philippine Peso and the Korean Won too
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| IndusInd Bank touches a 30-month low on asset quality concerns |
- Asset quality concerns have grown on worries that the worst of bad assets in the books may have not emerged yet
- Analysts have cautioned that the Bharat Fin acquisition may not pay dividends till this asset quality issue is sorted out
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| Shapoorji Pallonji group looks at assets sales to cut down on its debt |
- With weakness in the construction business, Pallonji Group is looking to cut its total debt by Rs.4000 crore
- The corporate construction business of the group took a hit after Tata Group orders started reducing after the fiasco
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| OPEC market share in crude market touches a multi-decade low of 30% |
- This is one of the lowest market share that the OPEC had in all its years; although market share has been falling
- The status of swing producer has shifted from Saudi Arabia to the US and Russia virtually dictates terms to the OPEC
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| 63 Moons (formerly FT) gets relief from the Mumbai High Court |
- Mumbai High Court rejected the plea by Mumbai Police to attach the assets of 63 moons against NSEL liabilities
- HC pointed out that under the arms-length rule, they were separate entities and it could set a wrong precedent
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| Macron rules out a new BREXIT deal for Britain for its October exit |
- Macron of France has refused to give any fresh deal to UK on BREXIT considering the limited time available
- However, Merkel has prevailed upon the EU to grant Britain another 30 days time to come up with a viable deal
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| New STT model on options will kick in from the first of September |
- Under the new STT model for options, ITM options will only be charged STT on moneyness and not on notional value
- This moves is likely to reduce the costs and also reduce the discount that options currently trade to the intrinsic value
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| Minutes of the MPC reveal that the RBI Governor strongly favoured 35 bps cut |
- Clearly, the higher than expected rate cut in the August policy was with the growth impulses in view
- The MPC did express some concern over inflation with two members voting for just a 25 bps rate cut
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| SEBI board meeting announces slew of benefits for FPIs |
- The regulator has simplified the KYC norms for FPIs and also reduced the number of FPI categories to two
- In addition, the FPIs will also be allowed to do off market transfer of shares; something hitherto barred for FPIs
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| Government panel in favour of cut in corporate taxes to 25% |
- The panel is also in favour of an across the board cut in corporate taxes to 25% from the current 30%
- This rate cuts were originally promised by Arun Jaitley but was implemented only up to a threshold of profits
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| Gold prices internationally crosses the $1500/oz mark during the week |
- Rising global uncertainty is leading to a major increase in demand for gold as a risk-off asset class
- In the last five years, gold holdings with ETFs has gone up by nearly 1000 tonnes to a level of 2425 tonnes
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| Dewan Housing defaults on commercial paper worth Rs.1571 crore |
- This default includes a 70% share of principal and a 30% share of interest payouts by Dewan Housing Finance
- With total debt of Rs.92,000 crore, Dewan Housing presents a major systemic risk for the economy as a whole.
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