Dear Colleagues
I am pleased to attach the Economy / Market Snapshot covering all the major events in May, 2020
Indian Markets lost about 2% last month. As I write today, Nifty is nearing the 10,000 mark; On the sectoral indices, Bank Nifty lost 10% and IT lost about 0.50%. Auto and Pharma gained 5% each and FMCG gained 2%. FII’s invested 11,800 crores in the equity market while Domestic Institutions invested about 2,700 crores in the equity market. FII’s pulled out Rs.20,600 crores from the debt market last month. Indian Rupee closed at Rs.75.62 for 1 US $.
On the Global markets front, DOW gained 4%, Nasdaq gained 7%, FTSE gained 3%, Nikkei gained 8%. Hang Seng lost 7% while Shanghai remained neutral. On the commodities side, Gold went up by 4% and Silver went up by 22% each. Brent Crude gained by 33% and currently trading at $ 35 a barrel.
The Lock down has erased two months in this financial year. While the government has extended the lockdown for one more month, this is more termed as Unlock Version 1.0 with relaxations happening across slowly. The daily rate in India for the confirmed cases is nearing 10,000 with only Brazil (25,000 daily), US (22,000 daily), Russia (9,000 daily) ahead of India. Maharashtra, Tamil Nadu, Delhi, Gujarat are moving up consistently with key cities like Mumbai, Chennai, Delhi being affected. While the new saying is that we have to learn to live with the Corona virus, it is a worrying scenario considering the facilities, medication etc. The good news is that the recovery rates are high and the death rates are lower. Layoffs have started, salary cuts are the new norm and the businesses are suffering. While there is sufficient liquidity in the banking system thanks to the announcement of the Government, Bank have not been fast enough to disburse or sanction and as a result businesses are suffering and more defaults are expected in the near future. Faster action in reaching the money to the needy will help the Companies and as of now the announcements are only in paper and these needs to be seen in reality.
Working From Home, Virtual meetings and interactions will become the new normal of the day. Each of the businesses have to relook at their strategy and act swiftly adapting to the new normal. Social distancing, highest hygiene standards, need based travel etc will have to be closely followed. Economy has to be opened up as there is no other choice but controlling and limiting the spread is equally a great responsibility and each one of us have to play our bit to minimize the damage. Let us hope that in the month of June, the spread is contained and we don’t explode with the second wave leading to another serious lockdown!!
Happy reading!……
Regards
V Murali
General News
- Worldwide Coronavirus cases reported at 6,263,064, death toll reaches 373,858.
- COVID-19 cases in India crosses 190,000 with 5,164 dead and 86,983 people recovered.
- Over 37 lakh samples of COVID-19 tested in India so far; recovery rate is at 47.76%.
- Centre extends nationwide lockdown in containment zones till June 30 with a phased plan to unlock India.
- PM Modi announces ₹20 lakh crore special economic package to deal with COVID-19 pandemic.
- PM CARES allocates ₹2,000 crore for ventilators, ₹1,000 crore for migrants & ₹100 crores for vaccine.
- MHA reconstitutes 11 empowered groups to implement containment measures.
- Home Ministry launches online portal for states to monitor movement of migrant workers.
- AYUSH launches clinical research studies on use of Ayurveda as preventive, curative medicine.
- Centre unveils PM-eVidya initiative: one TV channel each for classes 1 to 12.
- NEET, IIT-JEE Mains exam dates announced; CBSE 10th, 12th exams to be held from 1st to 15th of July.
- Kerala State Education Board holds exams for Class 10 and 12.
- Top 100 universities will be permitted to automatically start online courses by 30th May 2020.
- Indian Air Force, Navy carry out flypast and shower petals to salute brave corona warriors.
- Vande Bharat Mission: 45,000 Indian nationals evacuated so far in two phases.
- About 450 Shramik special trains ferry 40 lakh migrant workers, students back home.
- Ships from Maldives, Sri Lanka evacuate Indian nationals under Navy’s “Operation Samudra Setu”.
- Number of Ayushman Bharat beneficiaries crosses 10 million mark.
- India Post Office resumes booking for international speed post to 15 countries.
- Rajnath Singh approves ₹400 crore Defense testing infrastructure scheme under ‘Make in India’ initiative.
- Rajnath Singh approves abolition of 9,304 posts in Military Engineering Service.
- Only Made-in-India products to be sold in paramilitary canteens from June 1.
- India provided 2.8 million hydroxychloroquine tablets as grant assistance to 25 countries.
- PM Modi highlights needs for new globalisation based on ‘fairness, equality, humanity’ during NAM meet.
- PM Modi discusses COVID-19 pandemic situation with European Council President; interacts with Bill Gates on global response to COVID-19.
- Jaishankar participates in virtual SCO Foreign Ministers meet on COVID-19.
- Ladakh: India, China engage in border standoff.
- Cyclone toll in West Bengal rises to 98; announces ₹1,000 crore interim assistance for Bengal.
- Odisha receives ₹500-crore interim aid from Centre for restoration work post cyclone rampage.
- UP CM Yogi Adityanath transfers ₹225.39 crore to MGNREGA beneficiaries; online fund worth ₹218.50 crore to self-help groups.
- Arvind Kejriwal, MLA take oath as New Delhi Municipal Council members.
- Maharashtra CM Uddhav Thackeray, eight others sworn in as Legislative Council members
- Karnataka govt announces ₹1,610 crore relief package, hikes excise duty on liquor by 11%.
- UP govt to set up migration commission to help find jobs for workers returning from different States.
- Detention of Mehbooba Mufti, 2 others Kashmiri leaders under Public Safety Act extended by 3 months.
- Tamil Nadu Governor promulgates ordinance for state govt to take over Jayalalithaa’s residence.
- Sonia Gandhi launches Rajiv Gandhi Nyay Yojya for farmers in Chhattisgarh.
- 12 dead, hundreds fall sick after gas leak from private Polymers plant in Vishakhapatnam.
- SC refuses to stall the sale of liquor across India, says states can consider ‘home-delivery’.
- SC refuses to restore 4G internet in Jammu and Kashmir, asks Special Committee to take decision.
- Nepal approves new map including Lipulekh, Kalapani, Limpiyadhura amidst border row with India.
- India joins 61 nations to seek impartial probe into WHO’s Coronavirus response.
- WHO suspends clinical trial of hydroxychloroquine for COVID-19.
- US announces relaxations for H-1B visa holders and Green Card applicants.
- Donald Trump vetoes Iran war powers resolution.
- US Senate passes law to ban Chinese companies listing on exchanges.
- Donald Trump announces US plans to sever all ties with WHO.
- Japanese Prime Minister Shinzo Abe declares end to country’s Coronavirus emergency.
- Saudi Arabia to ease coronavirus curfew on June 21, except in Mecca.
- Millions of kids in Australia return to schools as COVID-19 numbers fall.
- New Zealand limps back to life after quashing Coronavirus in 49 days.
- Iraq Parliament chooses former intelligence chief Mustafa Khadimi as new PM.
- Israel’s Supreme Court clears Netanyahu to form government despite corruption charges.
- Afghan president Ghani and rival Abdullah strike power sharing deal after months-long stand-off.
Business News
- Nirmala Sitharaman announces special and comprehensive package of ₹20-lakh-crore catering to various sectors including cottage industries, labourers, middle class, industries.
- FM announces ₹3 lakh crore collateral-free automatic loans for MSMEs, to benefit 45 lakh units.
- Govt permits State govts to utilise State Disaster Response Fund for setting up shelter for migrants.
- Centre conditionally increases borrowing limits for states to 5% from 3% for FY21.
- Finance Ministry sanctions ₹92,077 crore to states as devolution of central taxes.
- Minimum wage increased from ₹182 to ₹202 per day; additional ₹40,000 crore allotted to MGNREGA.
- Govt announces ₹1 lakh crore for strengthening the Farm Gate infrastructure for Farmers.
- Govt launches ‘CHAMPIONS’ portal, a real one-stop-shop solution of MSME Ministry.
- Centre extends timeline for real estate project completions, registrations by 6 months.
- Defaults related to COVID-19 to be exempted from IBC for upto 1 year.
- Minimum threshold to initiate insolvency proceedings to ₹I crore from ₹1 lakh.
- GST annual returns filing for FY 2018-19 extended till 30 September.
- Aadhaar card, ration card linking deadline extended till September.
- Nirmala Sitharaman launches facility for instant, free PAN using Aadhaar.
- Tax relief to stranded NRIs, prolonged stay in India due to lockdown to be discounted: Finance Ministry.
- Govt. hikes excise duty on petrol by ₹10 per litre, diesel by ₹13 per litre.
- Government notifies cut in EPF contribution to 10% for May, June, July; no penalty for delayed deposit.
- Govt extends validity of motor vehicle documents till July 31, waives late fee.
- States impose extra tax on liquor to boost income.
- Govt amends Companies Act, makes PM CARES eligible to receive CSR funds.
- Cabinet clears food processing scheme, fisheries package and free food grains allocation for migrants.
- Cabinet approves proposal to launch Special Liquidity Scheme for NBFCs & HFCs.
- India’s service activity sinks at historic rate in April, PMI at 5.4 from 49.3 in March.
- India April manufacturing PMI falls to record low at 27.4 vs 51.8 in March.
- RBI cuts repo rate by 40 bps to 4%; extends loan moratorium period by 3 months to August 31.
- RBI raises group exposure limit for banks to 30%; extends ₹15,000 crore credit line to EXIM Bank.
- RBI cancels CKP Co-Operative Bank’s license, depositors entitled to be paid upto ₹5 lakh on liquidation.
- SEBI allows select mutual funds to make additional investment in govt bonds.
- Aditya Birla Sun Life Mutual Fund bars fresh inflows in two debt funds; no restrictions on redemptions.
- Vedanta board approves proposed de-listing from BSE, NSE.
- Yes Bank exits F&O segment, no new contracts to be available for trading from May 29.
- CSIR launches Kisan Sabha App to connect farmers to supply chain, transportation Management System.
- Aarogya Setu App mandatory for train and airline passengers.
- Railways cancels old ticket bookings done for travel upto June 30; Shramik, special trains to continue.
- Railways to start 200 non-AC special passenger trains daily from June 1; booking starts.
- DGCA issues seven bands of ticket pricing; minimum price ₹2,000.
- Domestic air travel resumes after 2 months; govt allows private jets, chartered flights.
- Air India opens booking; Indigo start booking for domestic flights to 51 cities.
- Lufthansa and German government agree on $9.8 billion rescue package.
- Latin America’s largest airline LATAM, files for bankruptcy in US.
- Major automakers resume production; offer schemes to boost car buying demand.
- Maruti Suzuki board approves supply of SUV Vitara Brezza to Toyota.
- Volkswagen pays €9 million to end proceedings against Chairman, CEO.
- Crude oil prices slide on US-China tensions, doubts about Russian output cuts.
- India resumes purchases of Malaysian palm oil after 4-month gap following diplomatic row.
- Reliance Jio gets investments from Silver Lake, Vista Equity Partners, General Atlantic and KKR.
- US puts new sanctions on Huawei, restricts company from using its technology.
- CSIR receives approval for clinical trial of ‘Phytopharmaceutical & Favipiravir’ to treat COVID-19.
- Gilead’s drug Remdesivir gets US FDA’s emergency use authorisation for COVID-19.
- Anil Ambani ordered by UK Court to pay $717 million to three Chinese banks in loan agreement case.
- Amazon, Flipkart, Ola and Uber resume their services in parts of India following new lockdown guidelines.
- Amazon food delivery service launched in India, rollout begins in Bengaluru.
- JioMart online grocery service rolled out in 200 towns across India.
- Uber Connect home-to-home package delivery service launched in India.
- Car rental company Hertz files for bankruptcy in the US and Canada.
- Amazon Prime Video to globally premiere 7 Indian movies as theatres remain closed.
- Spotify inks licensing deal with Saregama for India market.
- Shanghai Disneyland reopens with strict safety procedures.
- Johnson & Johnson to stop selling talc baby powder in U.S. and Canada.
- World Bank announces $160 billion assistance to 100 countries.
- IMF approves $18 billion emergency financing for 50 countries during COVID-19.
- AIIB extends $500 million loan to India to deal with coronavirus crisis.
- BRICS’ New Development Bank provides $1 billion loan to India to fight COVID-19.
- Govt appoints Economic Affairs Secretary Tarun Bajaj as Director on RBI Central Board.
- Alibaba’s Jack Ma quits SoftBank, board proposes three new Board Members.
- Facebook’s Libra appoints HSBC legal chief Stuart Levey as CEO.
- Wipro appoints Capgemini’s Thierry Delaporte as CEO and Managing Director.
Q1 Results
- ICICI Bank Q4 profit grows by 26% YoY to ₹1,221.36 crore; NII increased by 17% YoY to ₹8,927 crore.
- Kotak Mahindra Bank Q4 profit falls 10% to ₹1,267 crore (YoY), makes ₹650 crore COVID-19 provisions.
- Yes Bank Q4 losses widen to ₹3,668 crore; GNPAs higher at 16.8%, NNPA stood at 5.03%.
- Maruti Suzuki Q4 profit falls 28.1% to ₹1,292 crore; revenue declines 15.2% YoY to ₹18,198.7 crore.
- Reliance posts 37% drop in Q4 profit to ₹6,546 crore, announces ₹53,125 crore rights issue.
- Jio Q4 net profit zooms 177.5% to ₹2,331 crore; FB-Jio platforms transaction to be closed by June.
- Jio adds 24 million users in first 3 months of 2020, revenue jumps 27% to ₹14,835 crore.
- Bharti Airtel’s Q4 loss at ₹5,237 crore; full year losses balloon to ₹32,183 crore.
- Tech Mahindra Q4 profit falls 29% to ₹804 crore, overall revenues rose 6.72% to ₹9,490 crore.
- HCL Tech Q4 net up 24% to ₹3,154 crore, revenue up 16% to ₹18,587 crore announces dividend of @₹2.
- Biocon Q4 profit declines 42% to ₹123 crore, revenue grew 3% to ₹1,581 crore.
- Dr Reddy’s profit jumps 76% YoY to ₹764.2 crore, revenue stood at ₹4,432 crore.
| WORLD INDICES | |||||
|---|---|---|---|---|---|
| Indices | 29-May | 30-Apr | % 1M | 01-Jan | % since Jan |
| BSE | 32424 | 33718 | -3.84% | 41306 | -21.50% |
| NSE | 9580 | 9860 | -2.84% | 12183 | -21.36% |
| DOW | 25383 | 24346 | 4.26% | 28538 | -11.06% |
| NASDAQ | 9490 | 8890 | 6.75% | 8973 | 5.76% |
| FTSE | 6077 | 5901 | 2.97% | 7542 | -19.43% |
| Nikkei | 21878 | 20194 | 8.34% | 23657 | -7.52% |
| Hang Seng | 22961 | 24644 | -6.83% | 28190 | -18.55% |
| Straits Times | 2511 | 2624 | -4.32% | 3223 | -22.09% |
| Shanghai | 2852 | 2860 | -0.27% | 3050 | -6.48% |
| USD | 75.62 | 75.11 | 0.67% | 71.22 | 6.17% |
| Euro | 83.93 | 82.22 | 2.08% | 79.94 | 5.00% |
| GBP | 93.35 | 94.38 | -1.09% | 94.36 | -1.07% |
| Yen/100INR | 0.70 | 0.70 | 0.07% | 0.66 | 7.07% |
| Gold | 46654 | 44906 | 3.89% | 39067 | 19.42% |
| Silver | 50118 | 40989 | 22.27% | 46665 | 7.40% |
| Crude Brent $ | 35.49 | 26.72 | 32.82% | 66.29 | -46.46% |
| Crude Nymex $ | 35.33 | 19.44 | 81.74% | 61.30 | -42.37% |
| NIFTY SECTORAL INDICES | |||||
|---|---|---|---|---|---|
| Sectors | BANK NIFTY | CNX IT | CNX AUTO | CNX FMCG | CNX PHARMA |
| 29-May | 19297 | 14011 | 6219 | 29297 | 9769 |
| 30-Apr | 21535 | 14108 | 5901 | 28669 | 9327 |
| % 1M | -10.39% | -0.69% | 5.38% | 2.19% | 4.73% |
| 01-Jan | 32103 | 15722 | 8210 | 30234 | 8047 |
| % since Jan | -39.89% | -10.89% | -24.25% | -3.10% | 21.39% |
| INDIAN TRADE(USD MILLION) | |
|---|---|
| Exports | 10360 |
| Imports | 17120 |
| FDI | 2874 |
| Government Bond 10Y | 6.01% |
| GDP YoY | 3.10% |
| Inflation Rate | 5.84% |
| Forex Reserves $ M | 490040 |
| IIP % | -10.00% |
| INSTITUTIONAL TRADING ACTIVITY | ||
|---|---|---|
| Particulars | FII (Rs. crore) | MF (Rs. crore) |
| Equity | 11,796 | 2,702 |
| Debt | (20,653) | 9,238 |
| Total 1 M | (8,857) | 11,939 |
| Total Since Jan | (1,43,766) | 85,727 |
| Equity | (39,991) | 31,609 |
| Debt | (1,03,775) | 54,118 |
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