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ETMarkets Morning Podcast (ETMarkets.com)

Nifty in for a recast; YES Bank woes spill over & more

05:25 Min | August 21, 2019, 9:21 AM IST
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Transcript
Hello There! Good Morning. This is Saloni Goel from ETMarkets.com, and here is all the news you need to start your day

The Headlines:

> Your Nifty is in for recast
> Yes Bank’s woes spill over; bad news for DRL, NMDC
> Tatas are working on a strategy overhaul
> Car registration fee hike put on hold

And We have more. Stay with us.

Let’s first have a quick glance at how the markets are looking like...it does look like a promising start is on the cards today.

>> Asian shares are down as fresh worries about a global recession led investors to dump risky assets, with US President Donald Trump showing no sign of backing down in his trade war with China

SGX Nifty is not showing promise, down 27 points at 7 am (IST). MSCI index for Asia-Pacific shares outside Japan eased 0.2%, Nikkei slipped 0.6%, Australian shares 0.8% while KOSPI traded flat


Wall Street shares declined in overnight trade. The Dow and the Nasdaq fell 0.7% each while the S&P500 lost 0.8%.

IN THE CURRENCY MART

The rupee fell sharply on Tuesday against the US dollar, ending at over six-month low of 71.71 against Monday's close of 71.43 amid outflows from Indian stocks and a rise in global crude prices

LET ME NOW quickly GO OVER the top news we are tracking this morning.

Your Nifty is in for an Overhaul

NSE has revised the eligibility criteria for inclusion of stocks in Nifty indices, permitting scrips not listed but permitted to trade on NSE for inclusion. Nestle India immediately becomes a potential candidate for Nifty entry, while MCX, Abbott India, Bayer etc, too, now come into reckoning .


YES Bank’s woes spill over

CG Power and Industrial Solutions has disclosed manipulation of accounts and likely diversion of thousands of crores of rupees. Yes Bank took control of a 12.8% stake in CG Power in May after invoking shares pledged by founder Avantha Holdings. The lender’s market value has eroded by over 80% in one year due to chunky exposures in troubled companies such as Anil Ambani's Reliance Group, Zee Group, DHFL and Café Day Enterprises.


Two other big names are in trouble

>> US health regulator FDA has issued eight observations to Dr Reddy's Laboratories after the an inspection of its Duvvada facility,

AND

>> NMDC is at the doors of the central government for help after Karnataka refused lease extension for its Donimalai mines

Depression hovered over Dalal Street…
Earnings downgrades are becoming the norm every quarter, and circumspect ratings are no longer restricted to select financials or debt-heavy companies. EPS projections for Nifty dived 4.2% in last three months. Nifty’s 12-month rolling projected EPS dropped to Rs 654 on August 20 from Rs 678 at the end of June. Autos, metals and telecom stocks have led the downgrades. Bharti Airtel, Tata Motors, Tata Steel, Indiabulls Housing, JSW Steel and Vedanta saw the biggest cuts in earnings expectations.


MEANWHILE, SOME GOOD NEWS…

>> The government has put on hold a proposal to hike registration fee of petrol and diesel cars

AND
>> FinMin is reviewing the free trade agreement regimes, which are hurting India’s manufacturing adversely and benefitting the other nations more


Meanwhile

Tata Sons has set an ambitious target of making at least five of the group’s 10 verticals contribute 10-15% each to the group’s profits in contrast to the current situation when TCS contributes the bulk of it.

NOW, LET’S HAVE A QUICK LOOK AT SOME OF THE TOP CORPORATE NEWS THIS MORNING

>> Analjit Singh is in talks to sell a 10% stake in Max Financial Services, the holding company for Max Life Insurance, to raise as much as Rs 1,200 crore

>> BG Asia Pacific Holding sold 98.78 lakh shares, or 10% stake, in Mahanagar Gas on Tuesday at an average price of Rs 780 per share in a block deal


>> Wadia Group-promoted budget airline GoAir is likely to appoint iBankers for its IPO this month and plans to raise about Rs 1,500 crore by end of this year


>> The I-T department on Tuesday carried out searches at Oberoi Realty group and its biggest vendor Capacit’e Infraprojects for suspicious transactions


>> The country’s largest biscuit maker Parle Products says it may have to let go of 8,000-10,000 people if the ongoing consumption slowdown persists


LASTLY a look at the oil price,
Prices for Brent oil rose above $60 a barrel for the first time in over a week after data showed a larger-than-expected drawdown in US crude inventories, but worries about a global recession capped gains. Brent crude is up 13 cents at $60.16 a barrel while WTI crude rose 12 cents to $56.25

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