The Big Bull's assessment of the post-Covid market is intriguing. What is a liquidity-driven rally, he asks. "Which market rally is not liquidity-driven? Who decides 16 P/E is fundamental and 22 P/E is liquidity-driven?" As he questions analysts' varied interpretations of the surprise stocks rally, Rakesh Jhunjhunwala also prophesies that some of the best returns will come from the businesses struggling to survive the Covid disruption. "Most companies will survive. Some will be very good and start straight with growth phase. Some others will come with the revival phase and mature in growth phase and some will start with survival, go to revival and then go for growth," says he.
MARKET CUES: Where do we stand >>>  | Nifty futures on Singapore Exchange traded some 26 points higher at 7 am (IST) in signs that Dalal Street might see a positive start |
| On Monday, Nifty formed a 'Bearish Belt Hold' candle on the daily chart, as selling pressure set in from the word go. This does not bode well for the market. Analysts said the recent rally might be losing its steam |
| Stocks in other Asian markets traded mixed this morning. Australian stocks were the outperformers, up more than 2%, catching up after a holiday on Monday. Korean shares dipped on news that North Korea will shut contact with the South. Japanese stocks fell, while they rose in Hong Kong. |
| US equities turned positive for the year so far and Nasdaq wiped away the last of its coronavirus-induced losses to set a record. Dow rose 461 points, or 1.7%, S&P 500 rallied 38.46 points, or 1.2% and the Nasdaq 110 points, or 1.1% |
| The rupee settled on a muted note, up 3 paise, at 75.55 against the US dollar on Monday |
| Among other currencies, the dollar slid and commodity currencies gained as risk appetite ramped up. The New Zealand dollar rose to its highest in four months, while the Japanese yen weakened and the British sterling rose marginally. The dollar index fell 0.053%, while the euro rose 0.02% |
| Oil prices climbed on Tuesday on growing confidence in a global recovery with pandemic lockdowns easing. WTI crude futures gained 1.3%, or 50 cents, to $38.69 a barrel while Brent crude futures rose 1.4%, or 56 cents, to $41.36 |
| Gold price rose to Rs 46,300 per 10 gm, while silver climbed to Rs 47,440 per kg amid a spike in global prices. In global markets, gold futures rose by $22.30, or 1.33%, to be back above $1700. |
| LOOK WHO'S |  |
NBFC borrowing costs drop… Borrowing costs for NBFCs declined last month, after the most aggressive economic policies in a decade helped avert a further worsening in the sector during the pandemic. Premiums that investors seek to buy AAA-ranked five-year bonds of non-bank financial lenders over government securities declined in May after gaining for three consecutive months. A custom index of total outstanding debt at 50 financiers stayed at the same level as the previous month.
Read More IndusInd promoters to raise stake… Promoters of IndusInd Bank, the Hinduja brothers, will raise their stake in the private-sector lender within the regulatory limit of 15% through open market purchases — a move that helped the stock emerge as the biggest gainer on the 30-share Sensex on Monday. IndusInd International Holding, the promoting entity of the bank, currently holds 14.68%. The stock surged 7% to end at Rs 451.65 on Monday.
Read More Bharat Bond ETF NFO coming… Bharat Bond ETF, India's first bond exchange-traded fund, will launch a new fund offer in July to raise Rs 14,000 crore in two new series. The proceeds will be used as additional funding for central public sector undertakings and other government organisations to meet borrowing requirements.
Read More Govt goes for cost cutting… The government is likely to impose curbs on import-intensive capital spending by ministries and departments among further measures to divert resources to where they are needed and keep unnecessary expenditure in check in FY21 as it deals with the fallout of the Covid-19 pandemic. A top government official said spending deemed unnecessary or which can be delayed is likely to face curbs to meet resource needs elsewhere.
Read More ED told to confiscate Nirav Modi assets… A special court on Monday partly allowed a plea by the ED to confiscate properties owned by diamantaire Nirav Modi in the multi-crore PNB scam. It was the first such order passed under the Fugitive Economic Offenders Act. Special judge V C Barde exempted from confiscation properties that are secured to PNB and a consortium of banks either through mortgage, hypothecation or guarantee. The court said the assets shall be attached by the ED within a month.
Read More | AND WHO'S |  |
Bank FD rates drop near savings rate… It no longer pays to keep your money locked up in a bank. Fixed deposit rates have plummeted in recent months, with short-term rates now hovering very close to or below savings account rates. Surplus liquidity and sluggish credit growth have forced banks to cut rates on both short-term and long-term deposits, and made savers move to riskier instruments such as debt market mutual funds or even equity assets. SBI now offers 2.9% for deposits of between seven days and 45 days, slightly better than the 2.7% offered on savings bank accounts.
Read More Retails bargain for mall rental waiver… Large shopping malls, which have been feeling the pinch of a long lockdown, received another blow on Monday as several top retailers and restaurants refrained from opening outlets due to a deadlock over new rental agreements. While some big mall owners, such as DLF, Nexus, Phoenix and Select City, have offered to waive 50% rent during the lockdown period, most of these determined retailers have demanded a full waiver. They also want further restructuring of rent through revenue share and a reduction in minimum guarantee for six-to-nine months.
Read More WB expects Indian economy to contract 3.2%…The World Bank expects India's economy to contract 3.2% in this financial year, a sharp downgrade from its April projection of 1.5-2.8% growth, citing the stringent lockdown and spillovers from weaker global economic performance. The lockdown would severely curtail activity despite fiscal and monetary stimulus, it said in a report on Monday.
Read More Meanwhile... Labour woes dog realty, construction…. Construction and real estate are staring at a worker shortage of 52%, followed by manufacturing at 44% and healthcare and pharmaceuticals at 42%, according to a survey based on initial hiring discussions, enquiries and mandates. Companies across industries are facing a huge shortage of blue-collar workers as they gradually resume operations after the lockdown, and many are lining up incentives to woo workers from near and far.
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