India's foreign exchange reserves have been steadily declining for three months, ANI reported. In the week that ended December 27, the country's foreign exchange kitty declined by USD 4.112 billion to USD 640.279 billion ,as per RBI data, ANI cited. India's forex reserves have slumped twelve out of the thirteen weeks, reaching a new multi-month low. The reserves had been declining since they reached an all-time high of USD 704.89 billion in September. They are now approximately 10 percent lower than their peak. The reserves have been falling, most likely as a result of RBI intervention aimed at forcefully preventing the rupee from depreciating sharply, ANI reported. As per recent RBI data, India's foreign currency assets (FCA), which make up the majority of FX reserves, were worth USD 551.921 billion. Gold reserves currently total USD 66.268 billion, according to RBI data, ANI cited. According to estimates, India's foreign exchange reserves are sufficient to fund around a year's worth of projected imports. In 2023, India gained around USD 58 billion to its foreign exchange reserves, compared to a cumulative decline of USD 71 billion in 2022, ANI reported. In 2024, the reserves increased by a bit more than USD 20 billion. Without the recent fall, the reserves would have been far larger. Foreign exchange reserves (FX reserves) are assets kept by a country's central bank or monetary authority, principally in reserve currencies such as the US dollar, with smaller amounts in the Euro, Japanese Yen, and Pound Sterling. The RBI closely monitors foreign exchange markets, acting only to maintain orderly market conditions and reduce excessive volatility in the rupee exchange rate, without setting a specific target level or range, ANI reported. To prevent the rupee from depreciating sharply, the RBI frequently intervenes by managing liquidity, including selling dollars. A decade ago, the Indian rupee was one of the most volatile currencies in Asia. Since then, it has become one of the most stable currencies. The RBI has carefully purchased dollars when the rupee is strong and sold them when it falls, increasing the attraction of Indian assets to investors, ANI reported. (With ANI inputs)
05 January,2025 04:48 PM IST | New Delhi | mid-day online correspondentThe Indian stock markets opened nearly flat on Friday, continuing their movement towards the positive, as other Asian markets showed signs of strength. The Nifty 50 index opened at 24,196.40 points, registering a modest gain of 7.75 points or 0.03 per cent, while the Sensex opened at 80,072.99 points, up by 129.28 points or 0.16 per cent. Market analysts have pointed out that the rally on Thursday was largely driven by Foreign Institutional Investors (FIIs) buying into the market. However, with the current macroeconomic conditions, particularly a strengthening US dollar, sustaining such FIIs' investments could prove challenging. Experts suggest that the markets are likely to experience moderate movement until major corporate earnings reports are released. "The market's ability to surprise was evident in yesterday's unexpected rally of 445 points in the Nifty. Large-cap stocks outperforming small-cap stocks is a positive signal that may persist. However, it’s still too early to ascertain whether FIIs will continue their buying spree. With the dollar index at 109.25 and the US 10-year yield at 4.56 per cent, the broader macroeconomic situation does not favour sustained FII investments. A rise in deposit growth could bode well for banking stocks, which are currently well-priced," said V K Vijayakumar, Chief Investment Strategist at Geojit Financial Services. Sector-wise, Nifty Media led the gains with a 1.4 per cent rise, while shares in the Auto, IT, and Healthcare sectors came under pressure. Overall, other sectors registered positive movements. At the time of reporting, 29 of the Nifty 50 stocks had opened with gains, while 21 stocks were in the red. ONGC, HCLTech, SBI, Trent, and Mahindra & Mahindra were among the top gainers, whereas Hero MotoCorp, Infosys, TCS, Asian Paints, and Wipro were the leading losers. "Nifty had its best performance since November 22 and managed to close above the November 19 gap-down level of 24,150, which was a significant boost for tactical bulls. The break of the 200-day average in mid-December turned out to be a bear trap. That said, sustained momentum will be crucial, with immediate resistance at 24,250 and critical resistance at 24,306. On the downside, supports are at 24,000, with an extension at 23,830. Historically, Friday has been the best day of the week for the Nifty, with a 60 per cent win-rate and an average gain of 0.2 per cent," said Akshay Chinchalkar, Head of Research at Axis Securities. Meanwhile, in other Asian markets, Japan’s market remained closed for the New Year holiday, but other regional markets saw positive movement. Hong Kong's Hang Seng index surged by more than 1 per cent, Taiwan’s Weighted index gained 0.96 per cent, South Korea’s KOSPI rose by 2 per cent, while China’s Shanghai Composite index showed a decline at the time of reporting. (With inputs from ANI)
03 January,2025 10:03 AM IST | MumbaiBillionaire Gautam Adani's group on Monday announced its exit from FMCG joint venture Adani Wilmar by selling its entire stake to the Singaporean partner and in the open market for an estimated over USD 2 billion. In a statement, Adani Enterprises Ltd said it will sell a 31.06 per cent stake to Wilmar International. Another 13 per cent will be sold in the open market to meet minimum public shareholding requirements. It, however, did not give the price at which it was selling the stake. "With this, AEL will fully exit Adani Wilmar Ltd," it said. "Adani's nominee directors will step down from the board of Adani Wilmar Ltd." The transaction is likely to conclude before March 31, 2025. This story has been sourced from a third party syndicated feed, agencies. Mid-day accepts no responsibility or liability for its dependability, trustworthiness, reliability and data of the text. Mid-day management/mid-day.com reserves the sole right to alter, delete or remove (without notice) the content in its absolute discretion for any reason whatsoever
30 December,2024 04:11 PM IST | New Delhi | PTIThe Indian rupee suffered its steepest single-day decline in the last six months on Friday, sinking 53 paise to hit an all-time intraday low of 85.80 against the US dollar. This sharp depreciation is primarily attributed to the relentless rise in US bond yields, which has intensified the greenback's appeal in the global market. Despite positive movement in domestic equity markets, the rupee’s fall was largely due to the heavy selling by foreign institutional investors (FIIs). The decline in the valuation of equities in other Asian markets made Indian stocks appear less attractive, prompting a substantial exit of FIIs from Indian equities. This capital outflow further exacerbated the downward pressure on the rupee, according to analysts. Additionally, the rising price of crude oil has had a negative impact on the rupee, further contributing to its plunge. The rupee opened weak at 85.31 against the US dollar and continued to slide, eventually reaching its lowest-ever level of 85.80 during the mid-session. This marked the rupee's most significant single-day fall since March 22, when it closed 48 paise lower. By the end of the day, the rupee had stabilised slightly but remained down by 42 paise at 85.69. As per PTI, the previous sharpest single-day decline of 68 paise had been recorded on February 2, 2023. On Thursday, the rupee had already weakened by 12 paise to 85.27, continuing a downward trend from previous sessions. Market experts point to the Reserve Bank of India’s (RBI) decisions surrounding its forward contracts as a key factor. According to analysts, the RBI holds approximately USD 21 billion in short-side forward contracts set to mature in December and January. Speculation suggests that the RBI has opted not to roll over these maturing contracts, resulting in a scarcity of dollars in the market and an oversupply of rupees. This imbalance has intensified upward pressure on the USD-INR pair, pushing it towards the 85.80 mark. Further adding to the rupee's struggles is the broader global context, with the dollar index – which measures the greenback's strength against a basket of six major currencies – trading higher by 0.08% at 107.98. This uptick was driven by soaring US Treasury yields, with the 10-year bond hovering around 4.50%. Additionally, Brent crude, the global oil benchmark, saw a marginal rise of 0.07% to USD 73.31 per barrel in futures trade. On the domestic front, the Sensex, the 30-share benchmark index, was trading higher by 319.93 points, or 0.41%, at 78,792.41 points, while the Nifty rose by 89.60 points, or 0.38%, at 23,839.80 points. However, as per PTI, the outflow of foreign capital remained a significant concern, with FIIs being net sellers in the Indian capital markets on Thursday. They offloaded shares worth Rs 2,376.67 crore, according to exchange data. The rupee’s steep depreciation and the broader economic indicators reflect a period of turbulence for the Indian currency, with external factors like global bond yields and crude oil prices playing a key role in shaping its movement. PTI reports suggest that this trend could persist unless significant corrective actions are taken. (With inputs from PTI)
27 December,2024 01:49 PM IST | MumbaiThe Indian stock markets witnessed a decline in early trade on Friday, with benchmark indices Sensex and Nifty slipping further amid continuous foreign fund outflows and growing concerns over the US Federal Reserve's recent stance on interest rates. The 30-share BSE Sensex fell 214.08 points, or 0.27%, to 79,003.97, while the NSE Nifty dropped 63.8 points, or 0.27%, to 23,887.90 in early trading. Among the 30 blue-chip stocks, Axis Bank, Tech Mahindra, IndusInd Bank, JSW Steel, ITC, Larsen & Toubro, UltraTech Cement, and HDFC Bank were among the worst performers, leading to a dip in the overall market sentiment. On the other hand, stocks such as Titan, NTPC, Bajaj Finance, Bharti Airtel, Tata Consultancy Services, and Maruti showed resilience and recorded gains. In the broader Asian markets, South Korea's Seoul index opened lower, while the markets in Tokyo, Shanghai, and Hong Kong showed positive movements. US stocks closed mixed on Thursday, reflecting the ongoing volatility in global markets. Foreign Institutional Investors (FIIs) continued their selling spree, offloading equities worth Rs 4,224.92 crore on Thursday, according to the latest exchange data. This follows a marked shift in FII strategy, with the net selling for the week amounting to Rs 12,229 crore. The sustained FII outflows have put additional pressure on large-cap stocks, particularly in the financial sector. "The FII buying seen earlier in December has reversed, with this week's selling weighing heavily on largecaps and financial stocks. However, the negative reaction to the US Federal Reserve's comments is likely to be temporary. A recovery, driven by large-cap stocks, is possible in the near term," said V K Vijayakumar, Chief Investment Strategist at Geojit Financial Services. Meanwhile, global oil prices saw a decline, with Brent crude dropping 0.69% to USD 72.38 a barrel, contributing to the downward pressure on markets. On Thursday, the Sensex closed lower by 964.15 points, or 1.20%, at 79,218.05, while the Nifty slipped 247.15 points, or 1.02%, closing below the 24,000 mark at 23,951.70. The ongoing volatility in the stock market is largely attributed to the uncertainties surrounding the global economic outlook and the Fed's indication of fewer rate cuts next year, which has sparked caution among investors. (With inputs from PTI)
20 December,2024 10:11 AM IST | MumbaiIndia’s private sector ended 2024 on a robust footing, with the HSBC Flash India Composite Output Index rising to 60.7 in December, up from 58.6 in November. This marks the strongest expansion since August 2024, according to HSBC data compiled by S&P Global. The country’s private sector showed significant growth in both manufacturing and services, buoyed by a surge in new business inflows and notable job creation. The December figures highlight India’s economic resilience and steady recovery, ANI reports. The HSBC Flash India Manufacturing PMI climbed to 57.4 in December from 56.5 in November, indicating improved business conditions. The uptick was driven by increases in production, new orders, and employment, supported by robust domestic demand. Manufacturers also ramped up input purchases to meet rising demand, and pre-production inventories expanded, though finished goods stocks fell as firms utilised inventory to address higher orders. Meanwhile, the services sector remained a key driver of growth. The HSBC Flash India Services PMI Business Activity Index surged to 60.8 in December from 58.4 in November, reflecting sharp increases in sales and backlogs. Service providers benefitted from strong demand, both domestically and internationally, underlining the sector’s resilience. December also saw a substantial rise in workforce expansion. Private sector firms added permanent and temporary staff at the fastest pace in the survey’s history. Backlogs of work rose at their sharpest rate since May 2024, underscoring the growing workload faced by businesses. Demand for Indian goods and services reached its highest level since July, driven by sharp growth in domestic and international orders. New export orders, in particular, grew at the fastest rate in five months, with manufacturing leading in export performance. According to Ines Lam, Economist at HSBC, “The modest rise in the manufacturing PMI in December was largely supported by gains in current production, new orders, and employment. Domestic orders saw an accelerated expansion, indicating improved growth momentum. At the same time, input cost pressures persisted, prompting manufacturers to raise selling prices.” The output price index reached its highest level since February 2013, though firms raised prices at a slower pace than November’s near 12-year peak. Cost pressures from food, freight, and labour remained a challenge, ANI reports. Despite these pressures, business optimism strengthened for the second consecutive month, reaching its highest point since September 2023. Positive demand conditions and stronger customer relationships bolstered confidence among manufacturers and service providers alike. (With inputs from ANI)
16 December,2024 12:41 PM IST | New DelhiA recent report by the State Bank of India (SBI) reveals that around 4,000 listed Indian companies experienced a 6 per cent growth in revenue or gross sales during the financial year 2024. While the revenue growth was relatively moderate, key financial indicators, such as earnings before interest, taxes, depreciation, and amortization (EBIDTA) and profit after tax (PAT), showed robust increases of 28 per cent and 32 per cent, respectively. The SBI report noted that the top-line revenue growth was accompanied by a significant rise in both EBIDTA and PAT. However, the report also highlighted a noticeable slowdown in the growth of employee expenses. Employee costs rose by just 13 per cent in FY24, a considerable dip from the 17 per cent increase recorded in the previous year (FY23). This moderation in wage growth suggests that companies have been focused on managing their wage bills more efficiently while ensuring continued profitability. Despite the slower wage growth, Indian companies have managed to maintain a consistent EBIDTA margin of approximately 22 per cent over the past four years. During this period, the annual growth in wage bills has averaged around 12 per cent. This trend illustrates that companies are adeptly balancing their employee-related costs and other operating expenses to sustain healthy profit margins. In a further analysis of the expenditure side, using the weighted average contribution model, the report found that employee expenses continue to play a significant role in influencing EBIDTA performance. However, the negative contribution of employee expenses to EBIDTA growth has decreased, dropping from 8.6 per cent in FY23 to 7 per cent in FY24. This indicates that companies are improving their cost management strategies and controlling wage growth without undermining profitability. Looking ahead to FY25, listed companies have continued to show positive financial performance, with a 7 per cent growth in EBIDTA during the second quarter. However, employee expenses grew at a slower pace of 5.6 per cent, further confirming the trend of moderated wage increases. As per ANI, the report demonstrates that Indian companies are adopting a strategic approach to balancing revenue growth with cost management, ensuring profitability while controlling employee-related expenses. This careful modulation of wage growth, alongside consistent profits, highlights the companies' ability to navigate a volatile economic environment effectively. (With inputs from ANI)
16 December,2024 08:50 AM IST | New DelhiA recent report by the State Bank of India (SBI) has revealed that middle and high-income states in India have seen a more significant decline in food inflation over the last decade compared to their low-income counterparts. The report highlights the stark differences in food inflation trends between wealthier and poorer states, with a noticeable downward shift in food inflation in higher-income regions. According to the SBI report, the middle and high-income states have experienced a more pronounced drop in food inflation, which reflects a broader trend of faster disinflation in these areas. Conversely, low-income states have seen a much slower decline in food inflation. The report attributes this disparity to the migration of labour from low-income states to more prosperous regions in search of better employment opportunities. This migration is helping to accelerate disinflation in high-income states, as the inflow of workers, coupled with better job opportunities, likely contributes to the reduced pressure on food prices in these regions. However, the reduction in food inflation in low-income states is moving at a more gradual pace, which could be due to various factors, including slower economic development and fewer job opportunities. In addition, the SBI report points out that retail inflation across states is gradually aligning with the Reserve Bank of India’s target of 4 per cent. Using a Sigma-type methodology, the report concludes that the disparity in inflation rates among states has been narrowing over the past decade, though the convergence in food inflation is occurring at a faster rate than in general inflation. A key aspect of the report is the shift in the share of Gross Fixed Capital Formation (GFCF) among Indian states. The share of GFCF in low-income states has risen by 6.44 per cent between FY15 and FY23. In contrast, the share in middle-income states has remained stagnant at around 5 per cent. High-income states have seen a sharp increase in their GFCF share, which has surged from 4.17 per cent in FY15 to nearly 30 per cent in FY23. While the growing share of GFCF in high-income states is indicative of their increasing economic activity, the report also warns that this could exacerbate inflationary pressures in these regions. The rising disparity in economic growth and migration trends calls for balanced regional development and targeted interventions to prevent widening economic inequalities. (With inputs from ANI)
13 December,2024 09:25 AM IST | New DelhiIndia's edible oil imports saw a significant rise in November 2024, climbing 38.5 per cent to 15.9 lakh tonnes, primarily driven by a sharp increase in shipments of crude sunflower oil and crude soyabean oil, as per industry data released by the Solvent Extractors' Association of India (SEA). This surge marked the first month of the 2024-25 oil marketing year. According to the data, the total import of vegetable oils, including both edible and non-edible oils, rose 40 per cent in November, reaching 16.28 lakh tonnes compared to 11.61 lakh tonnes in the same month last year. Of this, 15.90 lakh tonnes were edible oils, up from 11.48 lakh tonnes in November 2023. Non-edible oil imports also witnessed a sharp increase, rising to 37,341 tonnes from 12,498 tonnes in November 2023. In the edible oil category, the import of RBD palmolein saw a notable increase, rising to 2.84 lakh tonnes from 1.71 lakh tonnes in the previous year. The import of crude sunflower oil saw the most dramatic increase, jumping to 3.41 lakh tonnes from 1.29 lakh tonnes, while crude soyabean oil shipments surged to 4.08 lakh tonnes, up from 1.50 lakh tonnes in the same period last year. However, imports of crude palm oil, which is a significant part of India's oil consumption, declined to 5.47 lakh tonnes in November 2024, compared to 6.92 lakh tonnes in the previous year. Overall palm oil imports, including both crude and refined, also declined slightly to 8.42 lakh tonnes from 8.69 lakh tonnes in November 2023. Meanwhile, imports of soft oils, including soyabean and sunflower oils, increased substantially to 7.48 lakh tonnes, up from 2.78 lakh tonnes last year. The data highlights a significant shift in India's edible oil import patterns. While palm oil, traditionally the dominant import, now accounts for only 53 per cent of total edible oil imports, soft oils, which include sunflower and soyabean oils, now make up 47 per cent, compared to just 24 per cent a year ago. Indonesia and Malaysia remain the primary suppliers of RBD palmolein and crude palm oil to India, while soyabean oil mainly comes from Argentina, Brazil, and Russia, and sunflower oil is largely sourced from Russia, Ukraine, and Argentina, according to the SEA data. As per PTI, these trends indicate a growing demand for soft oils in India, reflecting changing consumer preferences and market dynamics in the edible oil sector.
12 December,2024 01:48 PM IST | New DelhiIndian stock markets opened flat on Thursday as the ongoing consolidation continued. However, with the expiry of the futures and options (F&O) contracts today, experts predict increased volatility in the markets. The Nifty 50 index started the session at 24,604.45 points, down by 37.35 points or 0.15 per cent. Meanwhile, the BSE Sensex opened at 81,476.76 points, down by 49 points or 0.06 per cent. Market analysts pointed out that the expiry of F&O contracts today could lead to heightened volatility, although the overall trend of consolidation persists. They also noted that US Consumer Price Index (CPI) inflation figures were in line with expectations, which has further solidified the probability of a Federal Reserve rate cut in the near future. Ajay Bagga, a banking and market expert, mentioned that "The Indian markets are consolidating within a narrow range. Some volatility can be expected today due to the F&O expiry. With the Fed rate cut now largely priced in, the focus will shift to the inflation data expected today, which is anticipated to show a month-on-month drop in the CPI. We expect consolidation followed by a rise towards the end of the year." Bagga also pointed to the US Federal Reserve as a key factor influencing market movements. With US CPI data matching estimates, the probability of a rate cut by the US central bank has surged to over 98 per cent, providing a positive outlook for the US markets. At the time of writing, in the Nifty 50 list, 23 stocks had advanced, while 27 had declined. The top gainers included Tech Mahindra, Bharti Airtel, TCS, and Wipro, while the top losers were Apollo Hospital, SBI Life, BPCL, Trent, and Titan. Sectoral indices saw mixed performance. Nifty Bank, Nifty IT, Nifty Metal, Nifty Pharma, and Nifty Healthcare all registered gains, while other sectors showed a decline. Akshay Chinchalkar, Head of Research at Axis Securities, noted that indecision continued to prevail in the Nifty 50. "Resistance at 24,700 has held strong, and the market has formed a short-term 'pennant' pattern with rising lows and falling highs, indicating the potential for an upside breakout. If the support at 24,500 holds, we may see the market target the 24,800–25,000 zone," he said. On the foreign institutional investment front, foreign investors sold equities worth Rs 1,012 crore on Wednesday, while domestic institutional investors (DIIs) bought equities worth Rs 2,000 crore. Across other Asian markets, indices were in the green. Japan's Nikkei 225 surged by more than 1.28 per cent, Taiwan's Weighted Index rose by 0.93 per cent, Hong Kong's Hang Seng gained 0.68 per cent, and South Korea's market continued its recovery, up 0.35 per cent following recent political instability. Brent Crude was trading at USD 73.66, showing a marginal gain. (With inputs from ANI)
12 December,2024 09:54 AM IST | MumbaiThe Reserve Bank of India (RBI) has introduced several key measures to enhance the financial ecosystem, focusing on the integration of advanced technologies and the expansion of payment systems. Governor Shaktikanta Das, during the monetary policy announcement on Friday, outlined these initiatives, which include the linking of pre-sanctioned credit lines to the Unified Payments Interface (UPI) for Small Finance Banks (SFBs). This development builds upon a feature launched in September 2023, which allowed Scheduled Commercial Banks (excluding Payment Banks and SFBs) to link pre-approved credit lines with UPI. By extending this facility to SFBs, the RBI aims to provide last-mile customers, particularly those new to credit, with better access to low-ticket and short-term credit products. SFBs, known for their technology-driven and cost-effective operations, are expected to play a pivotal role in reaching underserved sections of the population. Operational guidelines for implementing this initiative will be released soon, ANI reports. Responsible AI framework announced As per ANI, the RBI also revealed plans to establish a Framework for Responsible and Ethical Enablement of Artificial Intelligence (FREE-AI) within the financial sector. Recognising the immense potential of Artificial Intelligence (AI) and Machine Learning (ML) technologies in improving operational efficiency and decision-making, the RBI stressed the importance of mitigating associated risks, such as data privacy issues and algorithmic biases. A dedicated committee, comprising experts from various domains, will be formed to design an ethical and adaptable framework to guide the use of AI in financial services. Details regarding the composition and scope of this committee will be disclosed in due course. Tackling digital fraud with AI-powered initiatives In a further effort to enhance cybersecurity, the RBI announced the development of MuleHunter.AITM, an AI/ML-driven model designed to identify mule bank accounts involved in fraudulent activities. Developed by the Reserve Bank Innovation Hub (RBIH), this pilot project has shown promising results in trials conducted with two major public sector banks. The initiative aligns with the RBI's hackathon, "Zero Financial Frauds," which aims to develop innovative solutions to combat digital fraud. Banks have been encouraged to collaborate with RBIH to refine and expand the MuleHunter.AITM project, reinforcing the RBI's commitment to safeguarding the financial system from emerging threats. These announcements mark a significant step in the RBI's efforts to harness cutting-edge technologies for enhancing financial inclusion, combating fraud, and ensuring the ethical use of AI in the financial sector, ANI reports. (With inputs from ANI)
06 December,2024 12:31 PM IST | New DelhiADVERTISEMENT
