>> Sensex’s FY21 show best in a decade
>> Govt quickly rolls back small savings rate cut
>> Sebi extends dividend policy rule to top 1,000 firms
>> No change in inflation target for RBI’s MPC
Hi there. Welcome to ETMarkets Morning, the show about money, business and markets. I am Sandeep Singh.
Let’s start with a quick glance on the state of the markets.
Dalal Street looked upbeat this morning after a $2 trillion infrastructure spending plan unveiled by US President Joe Biden pushed up US stocks to record highs overnight and triggered strong buying in Asian markets this morning. US 10-year Treasury yields steadied at 1.74% while the dollar stabilised after completing its best quarter in a year. Crude oil pared early losses after preliminary talks for a meeting of Opec and its allies offered no signal of output plans.
That said, here’s what else is making news.
The inflation target for RBI’s monetary policy committee has stayed unchanged. The government has opted to retain the 4% target for the next five years, indicating stability in the regime. The framework allows RBI to target inflation in the band of 2% to 6%.
The Indian stock market posted its best financial year performance in a decade in FY21, shrugging off the economic adversities caused by Covid-19. Nifty returned almost 71% in the financial year ended March 31 — the best since FY10 — in a record-breaking rally, though it raised questions whether the market has run up too fast. FPIs propelled the bounce, pumping in Rs 2,73,603 crore during the year — the highest ever inflows —aided by dollar’s weakness on account of the gigantic stimuli by the US government and the US Federal Reserve.
The Centre has quickly rolled back a decision to cut interest rates on small savings schemes. A day after announcing the decision to slash rates on instrument such as post office deposits and PPF by up to 110 basis points, dealing a fresh blow to savers seeking safety, the Finance Ministry said interest rates of small savings schemes of GoI shall continue to be at the rates that existed in the last quarter of 2020-2021. The new rates would have brought down the rate of interest on PPF to its lowest since 1974 at 6.4% .
India’s key infrastructure sector contracted at its fastest pace in six months in February, dragged by a decline in all the eight crucial segments triggering fresh worries over the health of the industrial sector. Data released by the DPIIT on Wednesday showed the eight core sectors — coal, steel, cement, refinery products, crude oil, natural gas, fertilisers and electricity — contracted by 4.6% in February after rising 0.9% in the previous month and sharply below the 6.4% growth in February 2020.
Markets regulator Sebi has extended the new rule that requires companies to formulate dividend distribution policies to the top 1,000 listed entities (based on market cap) from the top 500 earlier, in a move that promises handsome benefits for investors in the days ahead. The move came in a year that saw alteration of dividend policies by several large and small companies.
Lastly, the World Bank raised its forecast of India’s growth in 2021-22 substantially to 10.1% from the 5.4% it had projected in January. In a report titled ‘South Asia Vaccinates’, it said improvements came on the back of the country’s vaccination drive, which is likely to spur activity in contact-intensive sectors, and that the infrastructure push in the Union Budget is expected to aid growth momentum and revive domestic demand.
NOW Before I go, here is a look at some of the stocks buzzing this morning.
HCL Technologies has won a multi-year contract from global tier-1 automotive supplier Tenneco for integrated application development, modernisation, and operations services contract.
Anil Agarwal-promoted Vedanta, which owns the beleaguered copper smelter of Sterlite in Tuticorin, is now seeking to partner a state government to set up a new integrated copper complex, which includes the smelter.
Srei Equipment Finance, a wholly-owned subsidiary of Srei Infrastructure Finance, said that overseas investors have shown interest in the company
HDFC has increased rates on fixed deposits maturing between 33 and 99 months by10-25 basis points for the first time in 29 months.
Axis Bank has informed the exchanges that it has agreed to sell its UK subsidiary to OpenPayd Holdings.
Piramal Pharma Solutions, the contract development and manufacturing organisation of Piramal Pharma, will acquire Hemmo Pharmaceuticals for an upfront payment of Rs 775 crore
Do also check out over two dozen stock recommendations for today’s trade from top analysts on ETMarkets.com.
That’s it for now. Stay put with us for all the market news through the day. Happy investing!