Yes, this stocks carnage will pass. After a long time, the market is in bear mood following a relentless fall in the past few weeks. Post Monday mayhem, shares of some of the great companies now trade at lower prices, driven by a sense of panic. While this is a good time for stock picking, remember, no analysis works and no support levels are respected in such times. It will be risky to assume that the recovery will be immediate. The ideal strategy will be to stay away from momentum trades and not go against the current tide to bet aggressively.
STREET PULSE: Where we stand Nifty futures on the Singapore Exchange traded 35 points lower at 7am (IST), indicating a weak trade setup on Dalal Street. Elsewhere in Asia, shares fell as growing scepticism about Washington's stimulus package to fight the coronavirus outbreak knocked the steam out of an earlier rally.
HERE'S WHAT TO WATCH  | MSCI's broadest index of Asia-Pacific shares outside Japan fell 0.04%. Australian shares slipped 1.31% while Japan's Nikkei erased early losses to rise 0.24%. |
| Wall Street stocks finished a topsy-turvy session sharply higher on Tuesday. A day after suffering its worst decline in more than 11 years, Dow piled on more than 1,150 points, or 4.9 per cent, S&P500 jumped 4.9 per cent and the tech-rich Nasdaq 5 per cent |
| Oil prices climbed for a second day on Wednesday, lifted by hopes that US producers will cut output, but gains were limited compared with Monday's crash after Saudi Arabia and Russia triggered a price war. Brent crude futures rose $1.38, or 3.7%, to $38.60 a barrel, while WTI crude gained $0.97, or 2.8%, to $35.33 |
| The rupee slumped by another 30 paise to touch a 17-month low of 74.17 against the US dollar on Monday after global financial market meltdown signalled that the world is staring at a coronavirus-led economic recession. |
| LOOK WHO'S |  |
DIVIDEND TAX CUT AHEAD?… The government may consider effectively halving the tax rate on dividend income for individuals in the highest tax bracket, likely boosting stocks that are facing a rout globally. The government is looking to tweak the current regulations to bring down the tax on dividends to about 20% from up to 43% for Indian individual investors. The government may offer the concession by offering a flat 20% tax on dividend income. After a change in the Budget, dividend income is now taxable up to 43% in the hands of the recipient from April this year.
Read More LVB RECAPITALISATION… Lakshmi Vilas Bank, its capital adequacy well below the minimum needed, has approached RBI with a plan to raise $250-300 million (Rs 1,800-2,200 crore) from overseas investors through the sale of a 49-60% stake, said people with knowledge of the matter. The bank has been in talks with threefour investors and one of them has brought a "specific deal" to the table, said a person close to the bank, without elaborating. He said the prospective investor could act on its own or lead a consortium.
Read More ARPU BOOSTER… Price increases by telcos in December will likely more than offset revenue dips caused by any resultant reduction of voice and data services during the January-March quarter, analysts and industry experts said. The telcos are likely to report around 10% on-quarter growth in average revenue per user or Arpu — a key performance metric — in the fourth quarter, when the major impact of the tariff hikes is expected to take effect, they said.
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BOND TO EQUITY… A day after moving the court, many Yes Bank bondholders have come up with a settlement offer that would involve conversion of Rs 8,500 crore AT1 bonds into Rs 1,700 crore equity with existing stockholders of Yes Bank, roughly ending up holding one share for every three equity shares they have, this allowing several mutual funds holding bonds to participate in the infusion of equity capital to revive the private lender. The banking regulator and SBI, which is trying to rope in new investors in YES Bank, are yet to respond to the offer. The writ petition filed by Axis Trustee, representing the bondholders, will come up for hearing before the Bombay High Court on Wednesday.
Read More LOAN PROBE WIDENS… A number of loans granted to stressed NBFCs by Yes Bank have come under the scanner of investigative agencies. Co-founder Rana Kapoor was arrested by the Enforcement Directorate on Sunday after he was booked by the CBI on Saturday. Besides DHFL, loans running into several hundreds of crores of rupees were given to various stressed NBFCs, real estate firms and entertainment companies when Kapoor was in charge. A preliminary perusal of the loans given by YES Bank reveal that disclosures made to regulators, especially Sebi, were 'patently false'.
Read More Meanwhile... VIRUS CURBS MAY HT IT… Karnataka's health minister said he will ask technology companies to stop sending employees on overseas assignments, unless it is an emergency, as the state capital recorded three new cases of the Covid-19 infection on Tuesday. The move could trigger business disruption for Bengaluru's IT companies that generate over a third of India's software exports of $ 147 billion. The state health department has also sought details on employees who have travelled to Covid-19- affected countries since February 21.
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