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>> Potential candidates for MSCI inclusion are the focus of attention
>> Investors flock to postal savings to secure higher interest rates
>> Diagnostic stocks on the rise on Dalal Street
>> Overseas Indians try a trick to circumvent the new tax
Hi. Welcome to ETMarkets Morning, the money, business and markets show. I am Sandeep Singh.
Let’s start with a quick look at the state of the markets.
Dalal Street signaled a sense of weakness on Monday morning and Nifty futures traded around 15 points lower on the Singapore Stock Exchange at 7 a.m. (IST). Other Asian markets opened mixed after Wall Street indices rallied overnight to record a high on strong economic data that added to evidence of a strengthening recovery. In foreign currencies, the dollar resisted Monday’s losses. The rupee fell 18 paise on Monday to close at 73.30 against the US dollar. US Treasury yields stabilized at 1.70%. Oil retained most of its 4.6% decline due to growing delays in reopening Europe and impending Iranian supplies. Gold traded little on international markets.
That said, here’s what’s in the news.
Potential candidates for inclusion in the MSCI index are focused on Dalal Street. IIFL Alternative Research released a report, claiming that Adani Enterprises, Adani Total Gas, Adani Transmission, SBI Cards and Cholamandalam Investment are “high probability” candidates for inclusion in the MSCI Standard Index at the next semi-annual review in may. He said Jindal Steel, Voltas, SRF, Godrej Properties and Bharat Electronics are “medium likelihood” candidates for inclusion. Shares of the Adani Group could see inflows ranging from $ 207 million to $ 229 million each on such inclusion.
Diagnostic stocks are at their highest. Those shares jumped in the middle of Monday’s sale on expectations that the increase in Covid-19 cases will boost testing. Fund managers said investors were mixing their portfolios in favor of companies that could benefit from essential services rather than discretionary spending. Thyrocare Technologies jumped 7.35% on Monday while Metropolis Healthcare gained 2.6% and Dr Lal PathLabs 6.1%.
Many wealthy Indians with overseas businesses and jobs are trying to get around the country’s new tax rule that targets the global income of its citizens. These individuals set aside a slice of their income in jurisdictions like Singapore and Hong Kong to pay a small tax there in the hope that they would escape the glare of the income tax department in India. But whether their aggressive strategy pays off, it will depend on how harshly the tax authorities interpret the law.
Credit rating agency ICRA said bad debts from Indian banks could increase significantly this fiscal year when the government and the RBI roll back regulatory and tax support measures. Banks could see gross bad debts rise to 9.7% of advances in FY21 and 10.2% by the end of FY22, the rating firm said in a report. “While the asset quality and restructuring figures are encouraging, they do not reflect the underlying pressure on banks’ asset quality,” said Anil Gupta, head of the financial sector ratings sector at the ‘ICRA.
And finally, worried Indian investors are now rushing into postal savings. Eyeing simple products and visible returns, they rush to post offices to take advantage of the higher returns offered by postal savings plans. The government kept the interest rates on these small savings products unchanged for the April-June quarter, making these devices attractive compared to bank deposits. Financial planners believe that it is only a matter of time before the interest rates of these programs are reduced in line with the general low interest rate environment.
NOW Before you go, here’s a look at the actions buzzing this morning …
Adani Ports and Special Economic Zone (APSEZ), which last year acquired a 75% stake in the port of Krishnapatnam, bought an additional 25% for Rs 2,800 crore, making it a wholly owned port.
JSPL, led by Naveen Jindal, will divest 100% of its electricity subsidiary Jindal Power (JPL) in order to reduce the company’s overall debt by 28,000 crore rupees and reduce carbon emissions within the group.
Mortgage lender HDFC announced on Monday that it would acquire a 9.90% stake in Kerala-based infrastructure fund management company KIFML.
The country’s largest automaker, Maruti Suzuki India, said on Monday that its total production in March 2021 had increased significantly to 1,723,433 units compared to the same month last year.
Alcoholic beverage maker Tilaknagar Industries said it has signed an agreement with French distiller Pernod Ricard to manufacture its products at its manufacturing facility in Maharashtra.
Steelmaker JSPL announced a 20% increase in sales to 7.28 million tonnes for the fiscal year ended March 31, 2021 with production up 19% to 7.51 mt, the company said.
Also check out over two dozen stock recommendations for today’s trade from top analysts on ETMarkets.com.
That’s all for the moment. Stay with us for all the market news throughout the day. Good investment!
