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Good Morning!
For investors waiting for a rebound in midcaps, there is bad news. NSE Midcap index is now down 26% from its all-time high hit in January 2018, and trades at the lowest levels since February, 2017. Its trailing P/E is down to 28 times from the peak of 48 times, but higher than the 10-25 times range seen during 2005-2015. And FY20 earnings revisions have been much worse. The pain is far from over!
STREET PULSE: Where we stand
A Fed cut without a path... The US Fed cut interest rates on Wednesday, but said it's not the beginning of a long series of rate cuts to shore up the economy against risks, including global weakness. At the same time, he said, "I didn't say it's just one rate cut." That comment drew a sharp rebuke from President Donald Trump. Financial markets were whipsawed as Fed Chair Powell struggled to define the rate path ahead. Read More
It's a deal!... Promoters of Zee Entertainment Enterprises will sell an 11 per cent stake in the media company to US-based financial investor Invesco Oppenheimer Developing Markets Fund for Rs 4,224 crore. The move, spurning an offer by a Comcast-led group, follows a nine-month search for a buyer as the parent Essel Group seeks to reduce debt. Read More
It's slowing everywhere...
India's core sector growth slumped to its lowest in more than four years in June, reflecting the economic slowdown and the lack of pickup in investment. The index of eight core industries rose 0.2% in June, down from 4.3% in May and 7.8% in the year earlier, government data showed. A sharp slide in the performance of steel and cement underlined the lack of investment. Read More
Back to basics... Indian household savers are returning to low-yielding, but safe, bank deposits after seeing erosion of wealth in debt funds. Annualised deposit growth rose to 10.3 per cent at June end, from 8.1 per cent in September 2018 despite a 75 basis points policy rate cut by RBI during the period. Read More
Meanwhile...
US and Chinese negotiators wrapped up a brief round of trade talks on Wednesday that Beijing described as "constructive", including discussion of further purchases of American farm goods and an agreement to reconvene in September. Read More
STREET PULSE: Where we stand
 | Nifty futures on Singapore Exchange traded 55 points lower at 7 am (IST), signalling a negative start for Dalal Street. Asian shares fell to six-week lows after the US Fed poured cold water on expectations of a lengthy rate-easing cycle. Nikkei fell 0.4 per cent, KOSPI 0.5 per cent and Australian shares 0.3 per cent. Overnight, the Dow and Nasdaq lost 1.2 per cent each while the S&P500 declined 1.1 per cent. Read More |
| Crude oil prices fell after the US Fed dampened hopes for a string of rate cuts and Sino-US trade talks ended without progress. Brent fell by $1.06 to $63.99 a barrel, while WTI crude slipped 93 cents to $57.65. Read More |
| LOOK WHO'S |  |
A Fed cut without a path... The US Fed cut interest rates on Wednesday, but said it's not the beginning of a long series of rate cuts to shore up the economy against risks, including global weakness. At the same time, he said, "I didn't say it's just one rate cut." That comment drew a sharp rebuke from President Donald Trump. Financial markets were whipsawed as Fed Chair Powell struggled to define the rate path ahead. Read More
It's a deal!... Promoters of Zee Entertainment Enterprises will sell an 11 per cent stake in the media company to US-based financial investor Invesco Oppenheimer Developing Markets Fund for Rs 4,224 crore. The move, spurning an offer by a Comcast-led group, follows a nine-month search for a buyer as the parent Essel Group seeks to reduce debt. Read More
| WHO'S |  |
India's core sector growth slumped to its lowest in more than four years in June, reflecting the economic slowdown and the lack of pickup in investment. The index of eight core industries rose 0.2% in June, down from 4.3% in May and 7.8% in the year earlier, government data showed. A sharp slide in the performance of steel and cement underlined the lack of investment. Read More
Back to basics... Indian household savers are returning to low-yielding, but safe, bank deposits after seeing erosion of wealth in debt funds. Annualised deposit growth rose to 10.3 per cent at June end, from 8.1 per cent in September 2018 despite a 75 basis points policy rate cut by RBI during the period. Read More
Meanwhile...
US and Chinese negotiators wrapped up a brief round of trade talks on Wednesday that Beijing described as "constructive", including discussion of further purchases of American farm goods and an agreement to reconvene in September. Read More
Reduce
