BQuick On Dec. 8: Top 10 Stories In Under 10 Minutes
BQuick | Top news, must-read stories and columns – all served up in less than 10 minutes.
Here’s a roundup of the day’s stories in brief.
1. India Will Keep Stimulus Floodgates Open: Finance Minister
Finance Minister Nirmala Sitharaman isn’t worried about missing the fiscal deficit target this year as the nation aims to increase spending and boost demand in an economy that’s been ravaged by the coronavirus pandemic.
“I’m not going to allow the fiscal deficit number to worry me because there is a clear need to spend money to boost the economy and give demand the necessary push,” she said in an interview with Bloomberg TV.
The assessment, according to Sitharaman, needs to be done for the next financial year, keeping in mind the need to continue spending while being cautious of the deficit target.
Watch the full Bloomberg Exclusive interview with Sitharaman.
2. More UPI Transactions, More Failures
As more Indian consumers took to digital payments amid the Covid-19 pandemic, a surge in technical glitches has followed, leading to a near doubling of the transaction failure rate via the most-popularly used Unified Payments Interface.
Between January and October, the UPI transaction decline rate due to technical faults rose from 1% to 2.31%, according to BloombergQuint’s calculations based on the data available for the top 30 remitter banks (by transaction volume) available with National Payments Corporation of India.
Here’s why the failure rate rose and what can be done to fix this.
3. Tata Vs Mistry: Rs 1-Lakh-Crore Valuation Gap
The Supreme Court of India has been presented with two different valuations of the Mistry family's stake in Tata Sons Pvt. Ltd., the holding company of the Tata Group.
The Mistry side, in an earlier affidavit, pegged that value of its 18% at around Rs 1.75 lakh crore.
But the counsel for Tata Sons told the court on Tuesday that they believe the value is in the range of Rs 70,000-80,000 crore.
The valuation disagreement marks the latest chapter in a four-year-old wrangle..
4. Equity Mutual Fund Outflows Intensify
Equity mutual funds witnessed an outflow for the fifth straight month as redemptions intensified on profit-booking despite benchmarks scaling lifetime highs.
Net outflow from equity and equity-linked mutual fund schemes stood at Rs 12,917.36 crore in November compared with an outflow of Rs 2,724.95 crore in October.
That’s the biggest outflow at least since April 2018, when the AMFI began compiling data in the current manner.
“This is mainly on account of profit-booking,” said NS Venkatesh, chief executive officer at AMFI.
All types of equity and equity-linked schemes saw outflows. Here’s the data breakdown.
5. Nifty Clocks Modest Gains
Indian equity markets posted yet another day of gains, although modest, amidst subdued global cues.
The S&P BSE Sensex ended 0.4% higher at 45,608 while the NSE Nifty 50 index ended 0.3% higher at 13,392.
Nifty Midcap and Nifty Smallcap indices ended little changed from Monday's levels.
Follow the day’s trading action here.
Related Coverage
Investors baffled by Adani Green energy's zero analyst coverage.
India's stock rally could broaden to include banks.
Tyremaker TVS Srichakra announces Rs 1,000 crore capital expenditure plan.
Canara Bank stock jumps to highest in nine months after QIP.
Credit Suisse bets on two consumer durable stocks.
U.S. Stocks Drop
U.S. stocks fell as a surge in coronavirus cases fueled concern over tougher restrictions while negotiations over further stimulus slowed down in Congress.
The S&P 500 extended losses into a second day.
Tesla Inc. slumped as the electric-car maker plans to raise as much as $5 billion, tapping capital markets for a third time this year.
Pfizer Inc. rose after U.S. regulators gave early indications they may grant emergency-use authorization to its Covid-19 vaccine, calling the shot highly effective with no safety issues.
The pound pared losses after the U.K. dropped controversial parts of an internal bill that would have given it the power to unilaterally override the Brexit divorce treaty.
Get your daily fix of global markets.
6. JSW Steel Upbeat For A Recovery
The Indian steel sector is in the middle of an upcycle as the demand and production uptick is being witnessed across global markets, and is not restricted to China.
That’s according to Seshagiri Rao, joint managing director of JSW Steel Ltd., who expects a shortage of the alloy, better pricing in the Western hemisphere and opening of the global economy to aid steelmakers in India.
Read more to see Rao’s views on cost, capex, utilisation and demand in the steel sector.
7. Time To Rethink DFI Model?
KV Kamath feels there may be enough reason to reconsider India's development finance institution model.
Policymakers will have to think about whether it is appropriate to set up a bank given our needs but the needs are going to be large. So, to meet this, I think you need institutions who could provide support for this process.KV Kamath To BloombergQuint
Will that be enough to fund the country’s large infrastructure needs? Here’s what Kamath thinks.
8. Mukesh Ambani’s 5G Timeline
Mukesh Ambani urged the Indian government to accelerate the rollout of fifth-generation telecom services and scrap outdated 2G technology run mainly by rivals, Bharti Airtel Ltd. and Vodafone Idea Ltd.
“As many as 300 million mobile subscribers in India are still trapped in the 2G era,” Ambani, Asia’s richest man and chairman of Reliance Industries Ltd., said in a speech Tuesday at the India Mobile Congress.
“I assure you that Jio will pioneer the 5G revolution in India in the second half of 2021,” he said.
Ambani’s push for these policy measures will give an unparalleled edge to Reliance Jio. Read more.
9. U.K. Vaccine Drive Begins
Britain kicked off the first Covid immunisation campaign in the western world, with Prime Minister Boris Johnson championing the safety of the vaccine while noting the country “can’t afford to relax now.”
The U.S. pledged to secure enough vaccine doses for its population, while the nation is averaging about as many deaths per day from the virus as it did in April.
The World Health Organization said it prefers that shots not be made mandatory.
Germany plans to vaccinate as many as 8 million people in the first quarter of 2021.
Follow global updates on the vaccine rollout here.
India Needs A Tatkal Scheme For Covid-19 Vaccines
Allow the well-off to ‘jump the queue’ officially and buy the vaccine at an exaggerated price, subsidising the truly vulnerable, writes Raghav Bahl.
Here's how:
Reserve 10% of the 100 crore shots to be administered in 2021, that would be sold under the tatkal category for Rs 10,000 apiece.
If the full quota tatkal of 10 crore vaccines is snapped up by eager, well-off households that would raise Rs 1 lakh crore for the government.
That will effectively allow the state to fully subsidise a vaccine for the rest of the population.
10. Peaceful 'Bharat Bandh'
Normal life was hit across multiple states as lakhs of Indians answered the farmers’ call for a nationwide strike to oppose the new agriculture laws.
The day-long shutdown impacted traffic and movement across parts of the country as people hit the streets in protest.
Major wholesale markets in Delhi, Maharashtra and Uttar Pradesh were shut while certain highways were blocked in North Indian states.
Supply of various goods was also disrupted with truckers suspending operations.
Farmers have asserted that agitation will continue till the three farm laws are repealed. Follow updates here.
