This is a roundup of the day’s top stories in brief.
1. GST Compensation: Consensus Elusive
The good and services tax council failed to reach a consensus on the issue contentious issue of pending GST compensation for the states at its 42nd meeting today.
The decision has now been deferred to Oct. 12 when the council will meet again.
However, the Centre will disburse the amount collected as compensation cess this year, approximately Rs 20,000 crore, to states by tonight, Finance Minister Nirmala Sitharaman said in a media briefing.
Sitharaman said that no state will be denied their dues even if a consensus is not reached on Oct. 12.
She also said that the compensation cess will be extended beyond 2022.
2. Waiving Compound Interest: Finding The Good In A Bad Idea
It is now near certain, that we will see a new class of waivers introduced into the Indian banking lexicon. The compound interest or ‘interest-on-interest’ waiver, writes Ira Dugal.
The ideal option would have been to reject calls for any waiver of compound interest.
Having decided to do something, perhaps the idea should be to minimise the harm.
Beyond the decision, the implementation will not be easy and questions will arise along the way.
A cumbersome exercise awaits.
3. Nifty Ends Off Day's High
Indian stocks extended gains for a third session as an easing of restrictions and steps to support business fueled optimism that earnings may improve.
The S&P BSE Sensex ended 0.7% or 276 points higher at 38,973. However, the index fell nearly 300 points from the day's high.
The NSE Nifty 50 index too pared gains, but managed to close above the 11,500-mark, ending 0.8% higher.
Tata Consultancy Services Ltd. became the second Indian firm after Reliance Industries Ltd. to hit Rs-10-lakh-crore market cap.
TCS will on Wednesday consider its third share buyback proposal to reward stakeholders.
Shares in Angel Broking Ltd. fell 10% on their trading debut, the first disappointing listing by an Indian company in more than six months.
Follow the day’s trading action here.
U.S. Stocks Rally; Crude Surges 5%
U.S. equities followed global stocks higher on optimism over economic stimulus and that President Donald Trump may soon leave the hospital.
The S&P 500, Nasdaq Composite and Dow Jones Industrial Average all rebounded from Friday’s swoon in the wake of Trump’s coronavirus disclosure.
West Texas Intermediate crude surged 5.5% to $39.08 a barrel, the largest jump in 20 weeks.
Get your daily fix of global markets.
4. Yes Bank’s Deposits Rise
Yes Bank Ltd. witnessed an increase in its outstanding deposits during the quarter ended September as the private lender continues to regain normalcy under a new management.
The bank’s outstanding deposits rose to Rs 1.35 lakh crore as on Sept. 30, up 15.7% from Rs 1.17 lakh crore as on June 30. Compared with March 31, the rise is a steeper 29%, the bank said.
Yes Bank’s total advances rose 1.4% quarter-on-quarter to Rs 1.67 lakh crore at the end of the second quarter.
While the lender has been slowly rebuilding its liabilities franchise, low-cost CASA deposits are recovering at a slower pace.
5. SpiceJet's London Flight Plan
SpiceJet Ltd., India’s second-biggest airline, will start regular flights to London from Delhi and Mumbai, a move it has long been pursuing.
The no-frills airline will fly Airbus SE A330-900 neo aircraft on the routes, Chairman Ajay Singh said in an online briefing with reporters Monday.
The flights will start from Dec. 4 and there will be two a week from Delhi and one from Mumbai, according to a company statement.
The aircraft will have 353 seats in economy class and 18 in business.
Return fares start at Rs 53,555 ($730).
6. It’s Sale Season
Consumers should expect lower discounts on appliances and electronics at offline stores this festive season, as inventory constraints persist and cautious buyers shop online during the pandemic.
Components for consumer durables are imported and local lockdowns have created supply issues despite India allowing nearly all types of economic activities.
According to Harshit Kapadia, research analyst at Elara Capital, dealers have reduced inventory from four weeks to two weeks.
Here’s what some of the companies plan to launch and discounts they will offer during the upcoming festive season.
7. Google Defers New Policy After India Pushback
Google has deferred its new policy to charge fee for in-app payments in certain categories in India, days after local startup founders forged a collective to express concerns over the technology giant's dominance and to explore alternatives.
Google last week said it will start charging newer categories of online services like education, health and dating a 30% fee for payments made within its app system.
According to a statement on Monday, the Alphabet Inc.-owned company is going live globally with the new Play Store rule starting Sept. 2021, while it has delayed enforcement of the billing policy in India.
Google has been in the spotlight over the last one month as several founders expressed concerns with the way it has enforced policies in India.
8. Tata Vs Ambani = Alibaba Vs Tencent?
Just as the Chinese duo of Jack Ma and Pony Ma have carved up major chunks of their country’s internet businesses, the battle for control of 1.3 billion Indians’ data could become a two-horse race, writes Andy Mukherjee.
The kind of super-app that has succeeded in China and Southeast Asia requires a reason for customers to visit it regularly. Commerce is incidental.
Jack Ma’s Alibaba Group Holding Ltd. has its popular Alipay wallet. Pony Ma’s Tencent Holdings Ltd. has WeChat, a messaging service, and WeChat Pay.
But if Ambani wants to spawn India’s Tencent, Ratan Tata, can aim to launch its Alibaba.
9. India's New Covid-19 Cases Slow
Coronavirus cases in India continue to rise - even though at a relatively slower rate - after the government announced the fifth phase of lifting lockdown restrictions.
India added 74,000 fresh cases in a day, taking the total tally to over 66 lakh, according to health ministry's update at 8:00 a.m.
India reported less than one thousand deaths for the second consecutive day, today. An average of 1,000 deaths have been reported each day over the last week.
Track the latest updates on the Covid-19 pandemic in India, here.
Globally, cases crossed 3.5 crore leaving over 10.3 lakh people dead.
The World Health Organization estimated 10% of the global population may have been infected with Covid-19, outstripping the official estimates from governments around the world.
U.K. warned of a “very tough” winter as Europe faces rising infections.
Iran recorded its worst day yet, with cases surging.
Follow the global spread of the virus here.
10. Trio Wins Nobel For Medicine
Harvey J. Alter and Charles M. Rice of the U.S., and Michael Houghton of the U.K. were awarded the 2020 Nobel Prize in Physiology or Medicine for their seminal discoveries that led to the identification of a novel virus, Hepatitis C.
The three scientists have made “a decisive contribution to the fight against blood-borne hepatitis, a major global health problem that causes cirrhosis and liver cancer in people around the world,” the Nobel Assembly at Karolinska Institutet said in a statement on Monday.
The Nobel Foundation is increasing the award amount to reflect a rise in its own returns.
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