A Fed pledged a tough line on inflation, saying the central bank would stay the course in its fight. This added fuel to the worries of recession among investors. Back in India, traders will also keep an eye on the earnings report.
Pharma index comes under pressure in early trading as it is trading lower with most stock in red
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Google vows to cooperate with India antitrust authority after Android decision
Google said on Friday it will cooperate with India’s antitrust authority after the country’s top court upheld an antitrust order forcing the U.S. firm to change how it markets its popular Android platform.
The Competition Commission of India (CCI) ruled in October that Google, owned by Alphabet Inc, exploited its dominant position in Android and told it to remove restrictionson device makers, including those related to pre-installation of apps. It also fined Google $161 million.
On Thursday, Google lost a challenge in the Supreme Court to block the directives, getting seven days to comply.
“We remain committed to our users and partners and will cooperate with the CCI on the way forward,” a Google spokesperson said in a statement to Reuters.
“We are reviewing the details of yesterday’s decision,” Google said, adding that it would continue pursue its legal challenge to the Android decision. (Reuters)
Oil Heads for Second Weekly Advance as China Outlook Brightens
Oil headed for a second weekly gain as optimism over stronger Chinese demand overshadowed a weaker outlook in other major economies.
West Texas Intermediate rose toward $81 a barrel, putting the US benchmark on course for a gain of just over 1% this week. Chinese consumption has been picking up after the top crude importer abandoned harsh virus restrictions, with signs of increased buying by refiners in the physical market.
Still, weakness elsewhere has limited the rally. European Central Bank President Christine Lagarde vowed policy would remain tight as inflation was still too high. In the US, Federal Reserve Vice Chair Lael Brainard, considered a dove, said Thursday that rates will need to stay elevated for a period.
Crude has been whipsawed in the first three weeks of the new year as investors took stock of the market’s opposing forces, as well as the outlook for Russian flows into 2023 as sanctions are tightened amid the war in Ukraine. Against that backdrop, there are widely divergent outlooks from banks on where crude is headed, with Goldman Sachs Group Inc. arguing Brent could top $100 a barrel, while JPMorgan Chase & Co. is much more cautious. (Bloomberg)
Hindustan Unilever sheds 2% at the start, puts a huge drag on the market
Hindustan Unilever Ltd (HUL) on Thursday beat Street expectations with a 12% rise in quarterly net profit, with the maker of household goods gaining from higher demand for products and easing inflationary pressures. The company’s board also approved increased payout to its European parent Unilever Plc for providing technology, trademark licences and services. This entails paying royalty and central services fees at 3.45% of HUL’s revenue, up from 2.65% in FY22. The new arrangement, which is effective from February, will be in force for a period of five years. Meanwhile, HUL’s standalone net profit climbed to ₹2,505 crore for the three months ended 31 December, from ₹2,243 crore a year earlier. A Bloomberg survey of analysts forecast the company to report a profit of ₹2,488 crore.
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As gold hits new high, experts recommend these two stocks
Following disappointing US data that renewed fear of global economic recession, gold rates today climbed to new life-time high of ₹56,746 per 10 gm levels in domestic market, breaching its previous record high of ₹56,588 levels that it made on Thursday deals. As gold rates today climbed to a new high, stock market experts have said that it would have a direct impact on those financial stocks that deals heavily in gold loan.
Stock market experts went on to add that in India there are limited financial institutions that have a bulk business in gold loan. But, Muthoot Finance and Manappuram Finance have huge exposure in gold loan lending. As gold prices are expected to continue uptrend in medium to long term, they recommended positional investors to buy Muthoot Finance and Manappuram Finance stocks. (Read More)
Indices flat at open with HUL and Asian Paints dragging the market
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Wayfair to lay off over 1,000 employees due to sales decline
Layoffs are accelerating across the technology world since 2022. Many companies including Microsoft, Amazon, Twitter, Meta, and Ola have recently fired many employees and slashed the job opportunities. Another such company, Wayfair Inc has also announced a round of job cuts, said a person familiar with the situation on the condition of anonymity, adding that more than 1,000 employees will lose their jobs, according to Bloomberg news. (Read More)
Sensex preopens flat with a little tilt towards green; HUL and Adani Enterprises in focus today
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Geojit Financial Services: Triggers to take Nifty beyond 18200 are not yet visible
Dr V K Vijayakumar, chief investment strategist at Geojit Financial Services: Nifty which is now stuck in a narrow band of 17800-18200 is likely to remain in this range in the absence of major triggers. FIIs turning buyers is a major support at 17800. Triggers to take Nifty beyond 18200 are not yet visible. Large Q3 results from the likes of RIL, ICICI Bank and Kotak have to be closely watched for indications. The strength of HDFC twins and the weakness of ICICI Bank indicate some churn within financials. Data on capex, credit growth and manufacturing and services PMI indicate that the growth rebound in the economy is robust. Capital goods segment has the potential to outperform this year.
Reliance Securities Stock in Focus for Today: IndiGo
STOCK IN FOCUS
IndiGo (CMP 2,123): We have a positive stance on Indigo considering the strong market share position, undisputed leadership, best cost structure, potential in the fastest-growing aviation sector and lower crude prices bringing early turnaround, we reiterate our BUY rating on INDIGO with a Target Price of Rs2,350, valuing the stock at an unrevised EV/EBITDAR multiple of 7.5x FY24E.
Intraday Picks
BPCL (PREVIOUS CLOSE: 350) BUY
For today’s trade, long position can be initiated in the range of Rs347.50-
345 for the target of Rs358 with a strict stop loss of Rs341.50.
BAJAJ-AUTO (PREVIOUS CLOSE: 3,576) SELL
For today’s trade, short position can be initiated in the range of Rs3,598-
3,620 for the target of Rs3,520 with a strict stop loss of Rs3,645.
TATACONSUM (PREVIOUS CLOSE: 739) SELL
For today’s trade, short position can be initiated in the range of Rs742-
747 for the target of Rs722 with a strict stop loss of Rs754.
Inflation too high, European Central Bank committed to containing it
European Central Bank President Christine Lagarde said inflation is too high and reiterated the central bank’s determination to bring it back to 2 per cent.
“Inflation, by all accounts, however you look at it, is way too high. Our determination at the ECB is to bring it back to 2% in a timely manner, and we are taking all the measures that we have to take in order to do that,” Lagarde said speaking at the ongoing five-day World Economic Forum’s annual meeting.
The ECB chief was speaking at a session ‘Finding Europe’s New Growth,’ Thursday (local time).
While saying the central bank had already increased interest rates by 250 basis points, Lagarde said it shall “stay the course” until such time when monetary policy moved into “restrictive territory” for long enough so that the inflation can return to 2 per cent in a timely manner. (ANI)
Stocks to Watch: HUL, Adani Ent, Hindustan Zinc, LTTS, PVR, AU Small Finance Bank, Bhel, Indiamart Intermesh, Jubilant Foodworks, and Sun Pharma
Reliance Industries, JSW Steel, HDFC Life, LTMindtree, Bandhan Bank, Coforge, Union Bank of India, and JSW Energy, will be among the stocks in focus as they declare their December quarter earnings today. (Read More)
India Post Payments Bank looks set to break even in FY23: CEO
India Post Payments Bank (IPPB) is looking to break even by the end of this financial year with gross revenue crossing ₹500 crore. J. Venkatramu managing director and chief executive, IPPB, said the bank is investing heavily in technology and is focusing on getting small savings customers to the India Post network.
“We have a 3.5 million common customer base, who have various small savings schemes and accounts with India Post. The business model is linked to small savings schemes, with very attractive interest rates, which attracts a lot of people to invest in them. But since digital channels are not available, we are focussing on offering online access. Anybody having an account with our payments bank can move money to various small savings schemes digitally, and need not have to go to a branch to deposit cash. We are trying to digitize the whole journey for small savings.” (Read More)
AU Bank net jumps 30% to ₹393 cr on healthy core income
AU Small Finance Bank on Thursday reported its highest quarterly net profit of ₹393 crore, a growth of 30 per cent annually, for the October-December period of 2022-23 on improved asset quality and the resultant decline in provisions.
The bank said its gross bad loans declined to 1.81 per cent or ₹1,019 crore in the reporting quarter from 2.60 per cent or ₹1,058 crore in December 2021 and net bad loans improved to 0.51 per cent from 1.29 per cent or ₹285 crore and ₹520 crore, respectively.
Of the total provision, ₹127 crore are for the restructured book and ₹98 crore are for contingency provisions and ₹41 crore are floating provision. Standard provisions stood at ₹176 crore or 30 bps of total advances.
Total income of the Jaipur-based company rose 36 per cent to ₹2,413 crore, driven by a full 41 per cent jump in net interest income at ₹1,153 crore. The key profitability metric net interest margin which is the difference between the cost of deposit and loan pricing, at 6.2 per cent. (PTI)
Hindustan Unilever Q3 net profit rises 7.9 pc to ₹2,481 crore
FMCG major Hindustan Unilever Ltd on Thursday reported a 7.9 per cent increase in its consolidated net profit at ₹2,481 crore for the third quarter ended December 31, 2022.
The company, which had posted a net profit of ₹2,300 crore in the October-December quarter of the previous fiscal, said its board has approved a new royalty and central services arrangement with Unilever Group that will see an increase in the fees for the same to 3.45 per cent of turnover from 2.65 per cent in FY22.
Its consolidated total income during the quarter under review rose 16.35 per cent to ₹15,707 crore against ₹13,499 crore a year ago, Hindustan Unilever Ltd (HUL) said in a regulatory filing.
The total expenses stood at ₹12,225 crore in Q3 against ₹10,329 crore in the year-ago period, it added.
HUL CEO and Managing Director Sanjiv Mehta said the company has sustained its strong momentum and had yet another quarter of solid all-round performance. (PTI)
Netflix’s Hastings Gives Up CEO Title; Peters Named Co-Chief
Netflix Inc. co-founder Reed Hastings is stepping aside as chief executive officer of the company he’s led for more than two decades, leaving the position to his two longtime associates, Ted Sarandos and Greg Peters.
Sarandos, who was already co-CEO, is the company’s public face in Hollywood while Peters, previously chief operating officer, has overseen its product development and push into advertising. Hastings, 62, will serve as executive chairman of the company.
“Our board has been discussing succession planning for many years (even founders need to evolve!),” Hastings said in a blog post. “The board and I believe it’s the right time to complete my succession.”
Netflix ended the year on a high note. The company added 7.66 million subscribers in the final quarter of 2022, easily topping the 4.5 million average estimate of Wall Street analysts. Revenue, at $7.85 billion, was in line with estimates. Although it earnings, at 12 cents per share, fell well below the same period a year ago, the company forecast that its profit margin and free cash flow would improve in the year ahead.
Netflix jumped about 6% in after-hours trading after the announcement. Shares of Paramount Global, Walt Disney Co. and Warner Bros. Discovery also rose in late trading. (Bloomberg)
Microeconomic stability getting bolstered as inflation coming under control: RBI
The economic outlook of the country is optimistic and as the inflation rate is also falling around the tolerance limit, the macroeconomic stability is getting bolstered, the Reserve Bank of India (RBI) said in its January monthly bulletin. The central bank pointed towards narrowing the current account deficit (CAD) and said that emerging markets are appearing more resilient.
The year 2023 is coming with bigger risk than the previous year stemming from United States monetary policy and the US dollar, an article in RBI bulletin said. (Read More)
Adani Enterprises to list all its businesses over 2026-29
Billionaire Gautam Adani’s flagship Adani Enterprises Ltd, which is set to raise ₹20,000 crore through a follow-on public offer, expects all its business verticals across roads, airports and industries, to achieve the scale for independent listing between 2026 and 2029.
Adani Enterprises is the incubation platform of the group, having spun off businesses across ports, transmission, renewables and city gas distribution into separate listed entities.
“Once a business meets three tests—the capacity to execute business plans independently; stable capital structure; and organizational capability, meaning the business has the capability to execute the projects it undertakes and can operate the assets in a world class manner—it possibly becomes available for demerger,” Jugeshinder Singh, chief financial officer, Adani Group, said at a press conference on Thursday. (Read More)
Air India’s mega jet deal with Airbus, Boeing held up by engine-cost debate
Air India Ltd.’s order for as many as 500 aircraft from Airbus SE and Boeing Co. is being held up by an impasse with engine makers powering the 737 Max, dragging out what stands to be one of the biggest single purchases in civil aviation history.
CFM International, the General Electric Co. and Safran SA joint venture, is reluctant to offer big discounts on engines and maintenance that typically accompany mega orders, according to people familiar with the negotiations. The deadlock centers on the hourly rates Air India would pay for repairs, said one of the people, asking not to be identified as the deliberations are private. (Read More)
Vedanta to sell Zinc International assets to Hindustan Zinc for USD 2,981 million
Anil Agarwal-promoted Vedanta on Thursday said it will sell Zinc International assets to Hindustan Zinc for a cash consideration of USD 2,981 million.
Vedanta’s board approved the sale of Zinc International assets held by THL Zinc Ventures Ltd (Mauritius) (THLZV), a direct wholly-owned subsidiary of the metals and mining major.
The assets held THLZV through THL Zinc Ltd (Mauritius) comprising shares held in Black Mountain Mining Pty Ltd, South Africa (69.6 per cent) and THL Zinc Namibia Holdings (Pty) Ltd (100 per cent), Namibia, will be sold to the proposed wholly-owned subsidiary (SPV) of Hindustan Zinc Ltd (HZL) for a cash consideration not exceeding USD 2,981 million, Vedanta said in a filing.
Vedanta holds 64.92 per cent of the equity share capital of HZL.
The proposed transaction will be subject to receipt of necessary regulatory nods. (PTI)
Longer wait for GST tribunals with Council yet to clear proposals
Businesses may have to wait longer for quicker resolution of Goods and Services Tax (GST)-related disputes under the proposed appellate tribunals, as the Finance Bill 2023 is expected to skip crucial amendments needed in this regard.
The plan to set up GST appellate tribunals (GSTAT) across the country missed a crucial opportunity with the federal tax body, the GST Council, not clearing the proposals at its last meeting on 17 December, a person informed about the Centre-state discussions said. (Read More)
Buy or sell: Vaishali Parekh recommends 2 stocks to buy today
Vaishali Parekh of Prabhudas Lilladher has recommended two stocks to buy today, here we list out important details in regard to those day trading stocks:
1] Jubilant Food: Buy at ₹510, target ₹535, stop loss ₹500; and
2] UPL: Buy at ₹747, target ₹773, stop loss ₹738. (Read More)
Sun Pharma to acquire US firm Concert for $576 mn
Sun Pharmaceutical Industries Ltd on Thursday agreed to buy Concert Pharmaceuticals Inc. for $576 million to access the US company’s experimental drugs for treating skin diseases, including patchy hair loss.
Concert Pharmaceuticals has an extensive patent portfolio, including its lead product candidate, deuruxolitinib, a late-stage drug for treating alopecia areata, an autoimmune dermatological disease resulting in patchy hair loss.
The deal will help strengthen Sun Pharma’s dermatology product range in the US. The company said its immediate focus is on submitting a New Drug Application to the US Food and Drug Administration (FDA) in the first half of 2023. (Read More)
US Wall Street lose ground on Thursday as recession fears weigh on market
Wall Street’s losses deepened Thursday as worries that the U.S. may be headed for a painful recession kept stock traders in a selling mood.
The S&P 500 and Dow Jones Industrial Average each fell 0.8%, their third straight drop. The Nasdaq composite lost 1%.
Every major index is on track for a weekly loss after the market kicked off the year with a two-week rally. Analysts expect the broader market to remain unsteady as investors try to get a clearer picture of inflation and the economy’s path ahead.
“It’s very reflective of the conflicting views that investors have with respect to where things are headed here in early 2023,” said Greg Bassuk, CEO at AXS Investments.
Reports showed weakness in several areas of the economy, including the housing industry and manufacturing in the mid-Atlantic region, though they weren’t quite as bad as expected and the job market appears to remain healthy. They follow worse-than-expected readings a day earlier on retail sales, a cornerstone of the economy, and industrial production.
The weaker economic data “has investors a little bit on edge, questioning how much consumer resilience is left in the tank,” said Ross Mayfield, investment strategist at Baird. (AP)
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