Most analysts and RBI watchers believe the three external members appointed to the Monetary Policy Committee are more neutral-to-dovish in policy views, and as such, will tilt the money policy panel in the dovish direction. While that may not have any immediate impact on the central bank's policy, given the current high inflation levels and the policy rate may remain unchanged on October 9, thereafter RBI may go on to deliver a cumulative 50 bp rate cuts as growth is likely to remain below trend and inflationary pressures may subside, they say.
MARKET CUES: Where do we stand >>>  | Nifty futures on the Singapore Exchange traded 22 points lower at 7 am (IST), indicating a weak start ahead for Dalal Street. |
| On Tuesday, Nifty saw another day of gap-up opening and capitalised on that to top the recent minor swing high at 11,636. It has been making higher highs and lows and looking strong on technical charts. |
| Asian equities traded mixed after President Trump's decision to end stimulus talks until after next month's election. Shares saw modest losses in Japan and Hong Kong, and fluctuated in South Korea. |
| US stocks ended down more than 1% overnight. Dow fell 375 points, or 1.34%; the S&P500 lost 47.66 points, or 1.40%, and the Nasdaq 177.88 points, or 1.57% |
| Oil prices slipped after President Trump dashed hopes for a fourth stimulus package to boost the coronavirus-hit economy. WTI crude futures fell 87 cents, or 2.1%, to $39.80 a barrel while Brent crude futures fell by 74 cents, or 1.7%, to $41.91. |
| The rupee pared initial gains and settled for the day 17 paise lower at 73.46 against the US dollar on Tuesday. |
| The dollar held onto gains against most currencies. The British pound steadied after skidding 0.86% on Tuesday, as did the Australian dollar. The greenback was, however, unmoved against the yen. |
| Gold prices remained stable at Rs 53,350 per 10 gm, while silver trended at Rs 62,000 a kg. In New Delhi, the 22-carat gold price steadies at Rs 49,400. On the MCX, October gold futures jumped 0.20 per cent to Rs 50,526, while silver December futures traded at Rs 60,571. Global, the yellow metal traded lower at $1,877.65 an ounce. |
| LOOK WHO'S |  |
T+1 settlement on anvil… Sebi has set the ball rolling for a faster trade settlement in the Indian stock market. The capital markets regulator has sounded out clearing corporations of stock exchanges and custodian banks on the feasibility of cutting down the settlement cycle to T+1 — an abbreviation for Trade plus one day — from the existing T+2. At present, trades on Indian stock exchanges are settled within two days after they take place. An adoption of the T+1 system would mean the settlement happens the next day.
Read More Nifty firms may post double-digit profit growth… India's 50 large and frequently traded companies are likely to show double-digit year-on-year growth in net profit for the September 2020 quarter even though the revenue growth may turn out to be modest. The profit growth will be largely due to the focus of companies on margin management through cost optimisation and the low base a year ago due to losses by a few companies. ET Intelligence Group's estimates showed aggregate profit of Nifty50 firms is likely to grow 30.4% compared with a drop of 8.1% in the year-ago quarter. Revenue is expected to grow by a modest 1.4%.
Read More Quarterly Nifty Bank options to aid HNIs… The introduction of quarterly options contracts on the Bank Nifty will help institutional investors and HNIs take a medium-term bet on the banking index than the currently available weekly and monthly Bank Nifty options contracts. However, Bank Nifty weekly options contracts form over 60% of the overall Bank Nifty options volume given the low cost and shorter time duration.
Read More No Mauritius FDI for financial firms… RBI has spelt out that finance companies cannot be set up with FDI from Mauritius and other jurisdictions that do not meet the benchmarks laid down by the Financial Action Task Force — an inter-governmental policy making body setting anti-money-laundering standards. This was communicated by RBI in a letter dated October 5 to the industry body for venture capital and private equity funds.
Read More | AND WHO'S |  |
TCS buyback to fund Tata Sons?... Analysts and investors are wondering whether TCS -- the country's second-largest company by market-value -- is buying back shares at this juncture only to indicate a rosy outlook or to pump money into its parent, Tata Sons, in a more tax-efficient way. The timing of the buyback, coming as it does on the heels of the conflict between Tata Group and its biggest minority shareholder Shapoorji Pallonji Group, has triggered speculation that the move could be aimed at transferring money from the cash-rich TCS to holding firm Tata Sons to bolster its money chest.
Read More Trump ends talks on fresh Covid aid… US President Donald Trump, still being treated for COVID-19, abruptly ended talks with Democrats on an economic aid package on Tuesday, drawing criticism from presidential rival Joe Biden that he was abandoning Americans in the midst of a pandemic. Trump's tweet breaking off talks for a new round of stimulus spooked Wall Street, sending stocks down as much as 2% from their session highs and tarnishing one of the metrics that the Republican president has touted as a sign of his success.
Read More Interest waiver benefit not for realty sector… The government is unlikely to extend the proposed interest on interest waiver to the real estate sector, which has already benefited from funding support under the Special Window for Affordable and Mid Income Housing or SWAMIH, said people with knowledge of the matter. The Centre will make additional submissions before the Supreme Court on the proposed compound interest relief based on the report of the panel headed by former CAG Rajiv Mehrishi as well as directives stemming from the KV Kamath committee recommendations on loan restructuring, they said.
Read More Retail investors barred in perpetual bonds… Institutions can only invest in perpetual bonds, a riskier quasi-debt instrument that is not meant for retail investors, Sebi said in a circular Tuesday. With this, many wealth managers will not be able to sell them to yield-hungry retail investors amid a record low interest rate regime, a rampant practice that has raised eyebrows. The order came in the aftermath of the Yes Bank fiasco.
Read More Meanwhile... Bajaj Finance to provision more... NBFC Bajaj Finance on Tuesday said it would continue to accelerate its provisions for Covid-19 in the September quarter to further strengthen its balance sheet. It had registered a three-fold rise in provisions leading to a nearly 30% fall in profits before tax in the June quarter. The company had made additional provisioning of Rs 1,450 crore in Q1, taking the contingent credit loss provision due to Covid to Rs 2,350 crore in June quarter. The lender saw tepid loan growth, with new loans booked during the quarter halved to 3.6 million from 6.5 million a year-ago.
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