This is a roundup of the day’s top stories in brief.
1. Board Shake-Up At Indiabulls Housing Finance
Mortgage lender Indiabulls Housing Finance Ltd. on Wednesday reshuffled its board of directors after with Sameer Gehlaut stepping down as its executive chairman.
- SS Mundra, a former deputy governor of Reserve Bank of India, has been appointed as the non-executive chairman with immediate effect.
- Mundra had joined the board as an independent director in 2018.
- The company said that Gehlaut will relinquish his post and take up the position of chief executive officer of another listed firm where he is the promoter—Indiabulls Ventures Ltd.
- Gehlaut will also serve as non-executive, non-independent director of Indiabulls Housing Finance Ltd.
More on the reshuffle here.
2. How Jet Airways Killed Five Birds With One Stone
In the last three months, insolvent Jet Airways (India) Ltd. sold one of its non-core assets, settled with one of its lenders and repaid another.
- All this is unthinkable for a company under insolvency resolution since the law prohibits sale of assets and settlements with select creditors while proceedings are ongoing.
- But some creative thinking from the resolution professional, a reasonable creditors’ committee and the court’s blessing for a bona fide transaction has resulted in protection for Jet Airways.
Read this BQ Blue Exclusive to see how Jet Airways pulled off the unthinkable.
3. The Tide May Be Turning For Indian Steelmakers
India’s steelmakers finally have some good news, four months after the lockdown to contain the pandemic disrupted operations in the world’s second-largest producer of the alloy.
- The domestic mills are taking a cue from the recovery in automobile production, improving demand in China and Europe, cheaper raw materials and an increase in product prices.
- That even propped up their stock prices from the March low.
- Jindal Steel & Power Ltd. has rallied more than 104% since March 24, when the nationwide lockdown was imposed. Shares of JSW Steel Ltd., Steel Authority of India Ltd. and Tata Steel Ltd. have gained 23%, 13% and 22%, respectively, during the period.
- Still, analysts don’t want to cheer just yet. Barring Jindal Steel, the average of Bloomberg consensus 12-month target prices implies a downside of 2-5% for other steelmakers.
- But with easing lockdown curbs and the government’s focus on infrastructure, the steel sector is expected to revive.
Here are the factors that may help Indian steelmakers.
4. Nifty Ends Flat, U.S. Stocks Rise
Indian equity markets ended little changed ahead of the weekly options expiry on Thursday. The flat close, however, brought an end to the four-day winning streak for the S&P BSE Sensex and a six-day winning streak for the NSE Nifty 50.
- The Sensex ended 0.1% lower at 38,369 while the Nifty ended 0.12% lower at 11,308. This was the sixth straight day of sub-1% moves for the Indian markets.
- Among the sectoral indices, PSU Banks, Media and Auto stocks were the top performers in today's session.
- The PSU Bank index ended of the day's high but with gains of 2.6% while the media and auto index gained 2.5% and 2% respectively.
- Broader markets outperformed in today's session. The midcap index ended 0.1% higher while the smallcap index ended with gains of 0.5%.
Follow the day’s trading action here.
U.S. equities followed European stocks higher as the rotation into underperformers during the recent rally continued.
- The S&P 500 Index jumped 0.9% to 3,364.14 as of 9:31 a.m. New York time, the highest in almost six months on the largest climb in two weeks.
- The Dow Jones Industrial Average rose 1% to 27,963.93, the highest in almost six months.
- The Bloomberg Dollar Spot Index fell 0.3% to 1,178.48, the largest fall in a week.
- The yield on 10-year Treasuries increased two basis points to 0.67%, the highest in more than five weeks.
Get your fix of global markets update here.
5. Gold’s Goes On A Wild Ride, Oil Near 5-Month High
Gold rebounded Wednesday, extending a series of wild swings that saw the metal hit a record on Friday before plunging to below $1,900 an ounce.
- After surging about 30% this year, gold’s rally came to a sudden halt as U.S. bond yields rose.
- After dropping as much as 5.7% on Tuesday, the biggest one-day loss in seven years, spot gold sank as much as 2.6% to $1,863.15 an ounce.
- The metal then rebounded sharply, rising as much as 2% and was trading at $1,941.33 at 12:16 a.m. in London.
Yet the sharp correction doesn’t signal the end of gold’s run.
Oil climbed to near a five-month high after an industry report pointed to a third straight weekly drop in American crude stockpiles.
- Futures in New York rose past $42 a barrel after losing 0.8% Tuesday.
- The American Petroleum Institute reported inventories fell by 4.01 million barrels last week, according to people familiar with the data.
The improving picture in the U.S. overshadowed worries about the coronavirus’s impact on demand.
6. Fuel Demand In India Sends Mixed Signals
Signs of an economic recovery in May and June have been followed by mixed signals in July. While some high-frequency indicators contracted at a slower pace, some showed signs of a double-dip amid the continued spread of Covid-19.
- Demand for petroleum products continued to rise after hitting a record low in April.
- Demand for petrol in July was down 10.3% year-on-year compared with a 13.6% decline in June, according to data from the petroleum planning and analysis cell.
- However, demand for diesel contracted at a sharper pace of 19.25% in July, compared with a contraction of 15.4% in June.
- While petrol is largely consumed as fuel for two-wheelers, three-wheelers and cars, diesel is used in commercial vehicles, agriculture and industry, making it a strong indicator of economic conditions.
Read more to see what the oil demand points to for the economy.
7. China No Longer The World’s Factory?
A key supplier to Apple Inc. and a dozen other tech giants plans to split its supply chain between the Chinese market and the U.S., declaring that China’s time as factory to the world is finished because of the trade war.
- Hon Hai Precision Industry Co. Chairman Young Liu said it’s gradually adding more capacity outside of China, the main base of production for gadgets from iPhones to Dell desktops and Nintendo Switches.
- The proportion outside the country is now at 30%, up from 25% last June.
- That ratio will rise as the company -- known also as Foxconn -- moves more manufacturing to Southeast Asia and other regions to avoid escalating tariffs on Chinese-made goods headed to U.S. markets, Liu told reporters after his company reported financial results.
Intensifying trade tensions have pushed device manufacturers to diversify their production bases away from China.
8. Covid-19: India Tally Tops 23 Lakh
Coronavirus infections in India continue to race ahead with the country adding at least a lakh new cases every two days.
- India added more than 60,000 cases in a matter of 24 hours, taking the total tally to 23.2 lakh.
- This includes over 46,000 deaths and more than 16.3 lakh patients who have recovered.
- That’s the fifth time India has reported over 60,000 cases in a day.
- This comes at a time when the country’s Health Ministry is trying to convince people of the government’s success in handling the Covid-19 crisis.
- Effective clinical management of coronavirus cases has resulted in the rise of recovery rate to nearly 70%, while the case fatality rate has fallen below 2% for the first time since the lockdown was imposed on March 25, the health ministry said.
Track news and developments around the outbreak in India here.
Globally, cases crossed 20.3 million leaving over 7.42 lakh dead.
- Russia defended the safety of what it said was the world’s first Covid-19 vaccine and announced plans to start mass inoculation this month before clinical testing is completed.
- Nations in Asia struggled to contain new waves of infections.
- Australia’s Victoria state had its deadliest day and New Zealand put its biggest city, Auckland, back in lockdown after the first outbreak in more than three months.
Follow the global spread of the virus here.
9. Violence In Bengaluru Over Social Media Post
Areas under Pulakeshinagar constituency in Bengaluru resembled a war zone on Wednesday, hours after an unruly mob went on a rampage torching vehicles, irked over a communally sensitive social media post allegedly by put up by a relative of a Congress lawmaker.
- At least three people were killed in police firing and scores of others wounded, including at least 50 policemen in the violence and arson that erupted in the city on Tuesday night and continued till the wee hours of Wednesday.
- Charred vehicles, shards of glass from broken windows, stones and bricks lie strewn over the deserted roads of the violence-affected localities.
- Police have arrested about 110 people on charges of rioting.
More details here.
10. The World’s Best Hope For Enough Vaccine
As chief executive officer of the Serum Institute of India, the largest manufacturer of vaccines in the world, Adar Poonawalla can produce about 1.5 billion doses a year of almost any inoculation.
- He has machines that fill 500 glass vials every minute, and gleaming steel bioreactors almost two stories high that can make more than 10 million shots a month.
- He can claim, credibly, that he helps inoculate 65% of the world’s children, in more than 100 countries, against diseases such as measles and tuberculosis.
- And deep inside Serum’s lushly landscaped, 50-acre campus, about three hours inland from Mumbai, he’s already brewing the raw materials to make one of the leading experimental vaccines for the novel coronavirus at a scale that could make a serious difference to ending the pandemic.
Find out more about the extravagant billionaire’s immoderate ways which may help the world get out of its present crisis.
Also Read: Covid-19 And The Age Of Obituaries
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