Dear Colleagues
I am pleased to attach the Economy / Market Snapshot covering all the major events in July, 2020
Indian Markets gained another 7.50% last month. Nifty has crossed the 11,000 mark and has been able to hold at that levels. On the sectoral indices, IT went up by 22%, Pharma gained 12%, Auto gained 8%, FMCG gained 3% and Bank Nifty gained 1%, FII’s invested 8,200 crores in the equity market while Domestic Institutions sold about 5,000 crores in the equity market. Indian Rupee closed at Rs.74.81 for 1 US $.
On the Global markets front, DOW gained 2%, Nasdaq gained 7%, FTSE lost 4.50%, Nikkei lost 2.50%, Hang Seng gained 0.50% and Shanghai gained 11%. On the commodities side, Gold went up by 10% and Silver went up by 30%. Brent Crude gained 5% and currently trading at $ 43 a barrel.
Quarterly results of most of the large cap players have been very good which made the market to be positive. IT Companies led by Infosys and HCL, Banks led by SBI, ICICI and HDFC, Pharma Companies led by Dr Reddy, Alembic, FMCG companies led by HUL, Britannia etc have come with very good results despite the difficult scenario in Q 1 due to Covid 19 and the lockdown measures. Auto Companies have not done very well but their share prices have dramatically improved. There is a V shape recovery from the lowest in March 2020 to today across the World. Nasdaq is at all time high crossing the 10,000 mark for the first time in history. Reliance has become the 48th in the Global list of most valued companies and its share price has gone up by 38% from what it was in January 2020. It has recovered by 76% from March, 2020 when it touched a low of around Rs.870 per share to Rs,2,150 per share today.
On the Covid situation in India, while the number of confirmed cases are on rise with around 54,000 cases on a daily basis, the good news is the recovery rates are around 64% and the death rates are quite low. The testing has touched an all time high of 5 lakh tests a day which is also a good news. Cities like Delhi, Mumbai, Chennai and Ahmedabad are improving and the number of active cases have significantly come down, Districts like Pune, Thane, Bangalore Urban, many districts in Andhra Pradesh have reported very high numbers. Hopefully with the measures taken by each of the governments and with more good news on the vaccine / medicine etc should take us to the positive trajectory. The number of cases in US are also rising and with the elections in November, 2020 and the tensions arising out of the US-China actions are some of the concerns which can make the market volatile. The new unlockdown guidelines are out with more and more relaxations being announced. Let us understand that the next couple of months will be challenging and let us hope that we will be able to overcome the current challenges and progress towards the recovery.
Happy reading!……
Regards
V Murali
General News
- India surpasses Russia to become third-worst hit country by COVID-19 after US and Brazil.
- India Coronavirus cases pass 16 lakh, total recoveries cross 10 lakh; fatality rate drops to 2.16%;.
- Unlock 3.0 from August 1: No night curfew; metro, colleges and cinema halls to remain shut.
- First phase trial of Covaxin, India’s Covid-19 vaccine, begins.
- Indian Navy completes Operation Samudra Setu by repatriating nearly 4,000 Indians from 3 countries.
- Union govt successfully implements ‘One Nation One Ration Card’ facility in 20 States, UTs.
- Delhi LG inaugurates 10,000-bed Sardar Patel Covid care centre, the “largest” of its kind in the world.
- Delhi, Odisha, Karnataka and Tamil Nadu launches plasma bank to combat the spread of Covid-19.
- Mukhya Mantri Ghar Ghar Ration Yojana: Delhi govt gives nod for door-step ration delivery.
- India, Israel jointly develop ultra rapid testing kit for COVID-19; results within 30 seconds.
- India and EU renew Agreement on Scientific and Technological Cooperation for next 5 years till 2025.
- Cabinet approves new National Education Policy; HRD Ministry renamed Education Ministry.
- CM Naveen Patnaik inaugurates Odisha’s first plasma bank for treatment of Covid patients.
- Andhra govt brings COVID-19 treatment under Dr YSR Aarogyasri, State’s free healthcare scheme.
- Assam Floods: Over 120 dead, 26.38 lakh people affected; 95% of Kaziranga National Park submerged.
- Nagaland declared as disturbed area for another 6 months by the Centre.
- Haryana Cabinet clears draft ordinance for 75% quota in private jobs for locals.
- PM Modi launches Asia’s largest 750 MW solar power project in Rewa in Madhya Pradesh
- Election Commission defers by-polls to Lok Sabha and state assemblies scheduled up to September 7.
- New RS members assigned to committees; Scindia gets HRD, Pawar in defence, R Gogoi to foreign affairs.
- HC asks Gehlot government not to take action against rebel MLAs, makes Centre party in Pilot camp’s plea.
- Rajasthan Congress Legislature Party passes resolution supporting Ashok Gehlot-led govt.
- Sachin Pilot removed as Rajasthan Deputy CM, state unit Chief; Govind Singh Dotasara named as Chief.
- PLA troops ‘completely move out’ of Galwan as India-China head towards total disengagement.
- India test fires helicopter-launched anti-tank ‘Nag’ missile ‘Dhruvastra’ in Odisha.
- PM Modi delivers keynote address at UN’s Economic and Social Council session.
- India, US hold foreign office consultations, reaffirm commitment towards free, open Indo-Pacific.
- Five Rafale jets, the first of the 36 contracted by India, land at the Ambala air base.
- Govt approves purchase of fighter jets, missile systems, weapons worth ₹38,900 crore.
- Foundation stone of the Ram Temple on August 5, construction of the temple to be completed in 3-3.5 yrs.
- Home Ministry sets up panel to coordinate probe into 3 Gandhi family trusts.
- Supreme Court upholds rights of Travancore royal family to manage Padmanabhaswamy Temple.
- WHO acknowledges possibility of airborne transmission of Coronavirus.
- Russia’s Sechenov University claims successful completion of clinical trials of COVID-19 vaccine.
- US announces borders with Mexico, Canada to stay shut another month till Aug 20.
- US House passes bill to sanction Chinese banks over Hong Kong.
- US announces visa restrictions for Chinese officials under Reciprocal Access to Tibet Act.
- US drops plans to deport Foreign students in US; new students can’t enter if courses online.
- US sends one-year notice to quit World Health Organization over Coronavirus response.
- EU leaders seal deal on spending and €750 billion COVID-19 recovery plans.
- UK, Canada, Australia and New Zealand suspends extradition treaty with Hong Kong.
- French PM Edouard Philippe resigns as President Macron plans new team; Jean Castex named new PM.
- Russian President Vladimir Putin signs order to allow his rule till 2036.
- Indian population shouldn’t exceed 15%: 8,00,000 Indians face ouster after Kuwait clears expat quota bill.
- Pakistan offers third consular access to Kulbhushan Jadhav without presence of its officials.
- Singapore’s PM Lee Hsien Loong re-elected, as governing party PAP wins 14th parliamentary elections.
- Former Malaysian PM Najib Razak found guilty in corruption trial, sentenced to 12 years in prison.
- UN declares July 12 as Malala Day to honour Nobel laureate Malala Yousafzai.
- Maldives, Sri Lanka eliminate measles & rubella ahead of 2023 target.
- UN designates Pakistan Taliban leader Noor Mehsud as global terrorist.
- India’s 2018 Asian Games mixed relay medal upgraded to gold after Bahrain’s disqualification.
- BCCI appoints IPL Chief Operating Officer Hemang Amin as interim CEO.
- IPL set to start on September 19, final on November 8: Chairman Brijesh Patel.
- BCCI sends acceptance letter to Emirates Cricket Board to host IPL 2020 in UAE.
- Formula 1: Lewis Hamilton leads the driver table with 63 points followed by Valtteri Bottas.
- ENG vs WI: Broad grabs 500th wicket as England defeat West Indies by 269 runs to clinch the series 2-1.
- IOC postpones 2022 Dakar Youth Olympics, says committed to hosting Tokyo Games in 2021.
- ICC postpones T20 World Cup 2020 to Oct–Nov 2021, ODI World Cup in India shiftes to Oct-Nov 2023.
Business News
- GST collection for June at ₹90,917 crore; total for Q1 at 59% of last year revenues.
- Govt launches Special Liquidity Scheme of ₹30,000 crore to improve liquidity for NBFCs and HFCs.
- Centre approves ₹574 crore annual plan for national highway works in J&K.
- Govt, World Bank ink $750 million agreement for MSME Emergency Response Programme.
- Cabinet gives approval for extending Pradhan Mantri Gareeb Kalyan Ann Yojana till the end of November.
- Global tenders up to ₹200 crore not to be allowed in government procurement: Finance Ministry.
- Govt launches PM SVANidhi mobile app for extending microcredit to street vendors.
- India-US sign MoU to begin cooperation on strategic petroleum reserve.
- India bans power equipment imports from China, Pakistan.
- Consumer Protection Act, 2019 comes into force; e-retailers to display country of origin on products.
- Government extends work from home norms for IT, ITes companies till December 31.
- Centre amends Motor Vehicle Act; spare tyre not necessary in all cars.
- India bans 47 more Chinese apps, clones of 59 banned apps.
- Tamil Nadu signs eight MoUs worth ₹10,399 crore, to create employment for over 13,000 people.
- HDFC Life to replace Vedanta in Nifty50 index from July 31.
- Rossari Biotech’s ₹494-496 crore IPO opens for subscription today.
- PNB reports ₹3,689 crore exposure to DHFL as fraud.
- State Bank of India to invest up to ₹1,760 crore in Yes Bank FPO.
- YES Bank floor price at ₹12/share for FPO; minimum bid lot 1,000 shares.
- People’s Bank of China sells stake in HDFC in June quarter following furore.
- Paytm, Vijay Shekhar Sharma to acquire insurance firm Raheja QBE for $76 million.
- Government halts merger of 3 PSU general insurers; to infuse ₹12,450 crore.
- IRDAI gives its nod to Insurance companies to launch Corona Kavach Health Insurance Policies.
- Google CEO Sundar Pichai announces India Digitisation Fund, to invest ₹75,000 crore over next 5-7 years.
- China’s GDP up 3.2% in Q2, becomes 1st major economy to return to growth in wake of COVID-19.
- US budget deficit hits all-time high of $864 billion in June.
- Singapore economy enters recession, second quarter GDP plunges record 41.2%.
- China June exports unexpectedly rise 0.5% YoY, imports up 2.7%; posts a trade surplus of $46.42 billion.
- India, 27-nation EU decide to expand ties; set up high-level dialogue to address trade issues.
- India posts first trade surplus in 18 years as coronavirus hits imports.
- Indian railways to introduce private trains in phases.
- Registration of BS-IV vehicles banned by Supreme Court till further notice.
- Passenger vehicle sales in India decline 49.59% to 1,05,617 units in June: SIAM.
- FCA and Groupe PSA merge to form new automotive brand Stellantis.
- SpiceJet designated as the “Indian scheduled carrier,” to operate flights to the US and UK.
- Boeing receives $916 million deal to support NASA with International Space Station for next 4 years.
- International flights resume as India establishes air travel bubbles with US, France and Germany.
- Intel Capital to buy 0.39% equity stake in Jio for ₹1,894.50 crore; making it 11th investor in Jio Platforms.
- Reliance receives $ 1 billion from British Petroleum to form JV; will offer lubricants, fuels and EV charging.
- Qualcomm Ventures to invest ₹730 crore in Jio for 0.15% stake; RIL market cap crosses ₹12 lakh crore.
- Nokia rolls out 5G networks for industrial clients.
- Google to be strategic partner in Jio Platforms; to invest ₹33,737 crore for 7.7% stake.
- Apple starts manufacturing flagship iPhone 11 at Chennai plant.
- CEOs of Facebook, Apple, Amazon and Google virtually testified before Congress over their market power.
- Huawei faces ban from Britain’s 5G networks by 2027 in crackdown plan.
- TRAI asks Airtel and Vodafone Idea to pause premium plans that offer higher speeds.
- Reliance Jio applies for 5G spectrum.
- Patanjali to sell Coronil as ‘immunity booster,’ not ‘cure for COVID-19’.
- Serum Institute of India to begin trials of Oxford’s COVID-19 vaccine by August-end.
- Zydus Cadila begins human trials of its potential vaccine for Coronavirus.
- Covaxin: Bharat Biotech’s COVID-19 vaccine trials conducted on 375 people across India.
- Mylan commercially launches its remdesivir brand ‘DESREMTM’ in India.
- Flipkart acquires Walmart India, to launch Flipkart Wholesale for B2B segment in August.
- Jio Meet, a free video calling app by RJio, launched in India; allows upto 100 participants at one time.
- US Federal Communications Commission designates Huawei and ZTE Corp as national security threats.
- Flipkart Group invests ₹260 crore to pick minority stake in Arvind Fashions arm, Arvind Youth Brands.
- Cognizant India Chairman & MD Ramkumar Ramamoorthy resigns.
- Asian Development Bank appoints Election Commissioner Ashok Lavasa as new Vice-President.
- Shiv Nadar steps down as Chairman of HCL Tech, Roshni Nadar Malhotra takes over with immediate effect.
Q1 Results
- Kotak Bank Q1 net profit falls 9% YoY to ₹1,244 crore; provisions climb three folds to ₹962 crore.
- ICICI Bank Q1 net profit rise 36% YoY to ₹2,599 crore; ₹5,550 crore more set aside for COVID-19 provisions.
- YES Bank Q1 net profit plunges 60% YoY to ₹45 crore; total provisions at ₹1,087 crore.
- SBI Q1 net profit up 81% to ₹4,189 crore, net interest income rose 16% to ₹26,641.5 crore.
- Bharti Airtel Q1 loss widens to ₹15,933.1 crore on AGR provision; revenue rises 0.9% to ₹23,938.7 crore.
- TCS Q1 Profit slips 13.81% to ₹7,008 crore; Consolidated revenue inches higher by 0.39% to ₹38,322 crore
- Infosys Q1 profit surges 11.5% YoY to ₹4,233 crore, revenue grew 8.5% to ₹23,665 crore.
- HCL Tech Q1 Profit jumps 32% YoY to ₹2,925 crore, consolidated revenue increases 8.60% to ₹17,841 crore.
- Tech Mahindra Q1 profit jumps 21% to ₹972 crore, revenue falls 4% QoQ to ₹9,106.3 crore.
- Biocon Q1 PBT declines 21% to ₹252.30 crore, revenue up 14%; R&D spend 35% up at ₹107 crore.
- Dr Reddy’s Labs Q1 profit falls 12.6% YoY at ₹579 crore; revenue stood at ₹4,418 crore, up 15%.
- RIL Q1 Profit jumps 31% YoY to ₹13,233 crore, Other income up 54% on one-time gain of ₹4,966 crore investment by BP.
- Reliance Retail Q1 reports 17.2% decline YoY in revenue to ₹31,663 crore.
- Reliance Jio Q1 profit up 180% YoY to ₹2,520 crore, average revenue per user up 7.4% at ₹140.3 crore.
- IOC Q1 reports fall of 47% YoY to ₹1,910.8 crore; revenue down by 41% YoY at ₹88,936.54 crore.
- Maruti Suzuki reports net loss of ₹249 crore in Q1, revenues plunges 79.2% to ₹4,106.5 crore.
- Jet Airways loss widens to ₹5,535 crore in FY19 on account of rising expenses, revenue declines 2.6% to ₹23,314 crore.
| WORLD INDICES | |||||
|---|---|---|---|---|---|
| Indices | 31-Jul | 30-Jun | % 1M | 01-Jan | % since Jan |
| BSE | 37607 | 34916 | 7.71% | 41306 | -8.96% |
| NSE | 11073 | 10302 | 7.49% | 12183 | -9.10% |
| DOW | 26428 | 25813 | 2.38% | 28538 | -7.39% |
| NASDAQ | 10745 | 10059 | 6.82% | 8973 | 19.76% |
| FTSE | 5898 | 6170 | -4.41% | 7542 | -21.81% |
| Nikkei | 21710 | 22288 | -2.59% | 23657 | -8.23% |
| Hang Seng | 24595 | 24427 | 0.69% | 28190 | -12.75% |
| Straits Times | 2530 | 2590 | -2.32% | 3223 | -21.50% |
| Shanghai | 3310 | 2985 | 10.90% | 3050 | 8.52% |
| USD | 74.81 | 75.50 | -0.91% | 71.22 | 5.04% |
| Euro | 88.12 | 84.82 | 3.88% | 79.94 | 10.23% |
| GBP | 97.89 | 93.49 | 4.71% | 94.36 | 3.75% |
| Yen/100INR | 0.71 | 0.70 | 0.80% | 0.66 | 7.83% |
| Gold | 53828 | 48796 | 10.31% | 39067 | 37.78% |
| Silver | 64984 | 49824 | 30.43% | 46665 | 39.26% |
| Crude Brent $ | 43.30 | 41.15 | 5.22% | 66.29 | -34.68% |
| Crude Nymex $ | 40.27 | 39.76 | 1.28% | 61.30 | -34.31% |
| NIFTY SECTORAL INDICES | |||||
|---|---|---|---|---|---|
| Sectors | BANK NIFTY | CNX IT | CNX AUTO | CNX FMCG | CNX PHARMA |
| 31-Jul | 21640 | 18072 | 7280 | 30872 | 11149 |
| 30-Jun | 21370 | 14754 | 6719 | 30063 | 9985 |
| % 1M | 1.26% | 22.49% | 8.34% | 2.69% | 11.65% |
| 01-Jan | 32103 | 15722 | 8210 | 30234 | 8047 |
| % since Jan | -32.59% | 14.95% | -11.33% | 2.11% | 38.55% |
| INDIAN TRADE(USD MILLION) | |
|---|---|
| Exports | 21910 |
| Imports | 21110 |
| FDI | 2016 |
| Government Bond 10Y | 5.84% |
| GDP YoY | 1.10% |
| Inflation Rate | 6.09% |
| Forex Reserves $ M | 522630 |
| IIP % | (10.00%) |
| INSTITUTIONAL TRADING ACTIVITY | ||
|---|---|---|
| Particulars | FII (Rs. crore) | MF (Rs. crore) |
| Equity | 8,191 | (4,972) |
| Debt | (1,319) | 25,045 |
| Total 1 M | 6,872 | 20,073 |
| Total Since Jan | (1,13,779) | 1,45,747 |
| Equity | (7,304) | 25,222 |
| Debt | (1,06,474) | 1,20,525 |
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