Bullion has had a great run so far this year; gold up more than 40% and silver 50%. But as the stocks rally appears to have hit a hurdle and the US dollar shows signs of bottoming out, commodity investors are getting suspicious if the yellow metal will let off some steam. In fact, gold has already come off some bit from August peak. But Motilal Oswal analysts project gold to stand ground. Reasons? One, even if Covid vaccines materialise, governments and central banks won't be able to withdraw liquidity quickly. Two, high liquidity will eventually lead to higher inflation. Three, bloating fiscal deficits will put extra pressure on currencies, including the US dollar, which will in turn support commodity prices.
MARKET CUES: Where do we stand >>>  | Nifty futures on the Singapore Exchange traded flat at 7 am (IST) this morning, signalling indecisiveness on Dalal Street. |
| On Friday, Nifty50 fell for the second straight session and barely held above the 11,500 level. The index formed a Bearish Belt Hold on the daily chart and an indecisive Doji-like candle on the weekly chart. |
| Asian stocks retreated this morning as investors mulled remarks from US Fed officials that pointed to a slow economic recovery. Shares fell in Japan as traders returned from a holiday, while South Korean equities also declined. Hong Kong's Hang Seng slipped 0.1%. Shanghai Composite rose 0.1% and Australia's S&P/ASX 200 Index 1.7%. |
| US shares reversed earlier losses on Tuesday after Fed Chairman Jerome Powell said the economy has a long way to go before fully recovering and will need further support. The S&P 500 closed 1.1% higher at 3,315, while the Nasdaq Composite climbed 1.7% to 10,963 and the Dow Jones Industrial Average rose 140 points, or 0.5%, to 27,288. |
| Oil prices fell on Wednesday after an industry group reported a rise in US crude inventories against expectations for a decline. Brent crude slipped 21 cents, or 0.5%, to $41.51 a barrel, after gaining 28 cents on Tuesday, while WTI crude fell 23 cents, or 0.6 per cent, to $39.57. |
| The rupee depreciated 20 paise and settled at 73.58 against the US dollar on Tuesday tracking negative domestic equities. |
| The dollar rebound extended as it pushed past key technical resistance. The yen fell 0.2% and the euro 0.2%. The offshore yuan lost 0.2% and the Aussie fell 0.5% |
| Gold and silver prices in India gave up early gains to move lower on Tuesday. On MCX, gold futures fell 0.14% to Rs 50,400 per 10 gm while silver futures declined 0.5% to Rs 61,011 a kg. In global markets, the yellow metal was little changed at $1,900.24 an ounce. |
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LIC to invest Rs 2 lakh cr in stocks, bonds… LIC will likely invest an estimated Rs 2 lakh crore in bonds and equities through the rest of FY21 as it expects demand for protection and coverage to increase in the aftermath of the pandemic, thus raising premium collections. The largest domestic institutional investor has already invested a similar quantum since April 1. This is marginally higher than the investments in the corresponding period last year, reflecting no slowdown in the insurance industry.
Read More NSE, SGX to withdraw arbitration… NSE and Singapore Exchange have ended their four-year-old legal dispute over the abrupt termination of a licence that allowed India's equity derivative products to be traded in the island nation. According to an official statement, both exchanges have decided to withdraw the arbitration proceedings and are in final stages of the creation of a special platform at the International Financial Services Centre, GIFT City.
Read More Dimon says India can get back to 7% growth…. The Covid-19 pandemic has been 'tough' on India with record high infections and lockdown crippling economic activity, but the country can aspire for 7% economic growth soon with consistent policies and fair treatment of international capital, said Jamie Dimon, chairman of JPMorgan. This crisis may be a great opportunity to deliver on the country's growth potential as international businesses look for newer geographies that have skills and infrastructure and offer a stable regulatory regime, he said.
Read More Sebi draft ready for Nasdaq-like bourse… Markets regulator Sebi, which has been trying to get its Innovators Growth Platform (IGP) off the ground, is expected to come out with its latest draft for the same, touted as India's answer to global tech bourses, such as Nasdaq. IGP, which has been in the works for a few years now, and was previously known as the Institutional Trading Platform, before being renamed last year, has found few takers till date, with the Indian startup and venture capital ecosystem asking for a number of recommendations to be included in the latest draft.
Read More Crypto is beating gold as top asset... The Bloomberg Galaxy Crypto Index of digital coins is up about 65% in 2020, exceeding gold's jump of more than 20% as well as returns from global stocks, bonds and commodities. A key reason for the move higher is a surge in Ethereum, which accounts for more than a third of the crypto gauge's weight.
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Mistrys seek to exit Tata Sons… The Shapoorji Pallonji Group has said it is willing to exit its decades-old position in Tata Sons. However, a fresh battle is expected over the valuation of its 18.4% stake, with the SP Group likely to demand ₹1.78 lakh crore. The Mistry family-owned group's decision — after it failed to get a favourable order in the Supreme Court on Tuesday — could bring to an end a four-year legal and boardroom battle sparked by the ouster of Cyrus Mistry from the chairmanship of Tata Sons in 2016. The Supreme Court on Tuesday restrained Mistry family firms from either pledging or transferring any Tata Sons shares until October 28, when hearings resume.
Read More Taxman knocking on the door again… The taxman is back knocking on the door. In the past one month several individuals have been summoned by the investigation wing of the income tax department for depositing large amounts of cash with banks immediately after demonetisation was announced on November 8, 2016. Chances are amid a dip in tax collection, there could be more I-T notices in the coming days. On September 18, in a communiqué to senior I-T officials, CBDT removed the restrictions — introduced in the wake of Covid-19 — on issuing adverse communication to assessees.
Read More Arunachalam entry into Murugappa board blocked… The family members of the Murugappa Group have voted overwhelmingly against the proposal to appoint Valli Arunachalam on the board of Ambadi Investments. The shareholders voted out the resolution with 91.37% of the total votes rejecting her proposed appointment, dealing a major blow to Arunachalam's efforts to enter the male-dominated board, said two people aware of the development.
Read More Meanwhile... India Inc seeks emergency credit line… India Inc has made a strong pitch to extend the emergency credit line guarantee scheme to stressed sectors while allowing alternative investment funds to function as multiple bad banks. Industry representatives, at a meeting of the Amitabh Kant-led empowered group on Tuesday, also asked the government to lay out a medium-term fiscal roadmap to provide clarity on the fiscal situation.
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