Rise With Profit: US Economic Data, India's Fiscal Deficit, TRAI Extension

Season’s greetings to you from all of us at NDTV Profit. May the season of lights be the start of a year filled with success and prosperity.

If you would like to listen to this as a podcast, click here.

Here’s everything you need to know before the trading day starts today.

Let’s first look for the major cues from overseas. The US economy expanded at a robust pace in the quarter ended September, driven by consumer demand, which is the primary engine of growth in that economy. Inflation-adjusted gross domestic product increased at a 2.8% annualised after rising 3% in the previous quarter, according to the government’s initial estimate published yesterday. The median forecast in a Bloomberg survey of economists was for a growth of 2.9%.

Consumer spending, which comprises the largest share of economic activity, grew 3.7%, the most since early 2023.

In response, there was selling of equity and a further rise in bond yields. The equity benchmarks fell between 0.2% and 0.6% and the yield of the 10-year rose to 4.3%. The data gains significance ahead of the Federal Reserve Open Market Committee’s meeting next week. Traders are now dialling back expectations of rapid fire rate cuts. And of course, there’s also the US Presidential Elections to think about. Voting is scheduled for Nov. 5.

Back home, there’s news on the economy. India's eight core sectors saw a modest growth in September, led by refinery and cement. The combined index of eight core industries grew 2% in September. This, after the contraction of 1.6% in August, which had marked the first decline in 42 months.

The Union government's fiscal deficit expanded to 29.4% of the budgetary target at the end of the first six months for the financial year ending March 2025. The gap between expenditure and revenue during April-September stood at Rs 4.75 lakh crore of the total limit set at Rs 16.85 lakh crore for the ongoing fiscal. The fiscal deficit was supported by the RBI’s dividend payment earlier in the year and a reduction in capital expenditure, which has been slow to pick up.

On the revenue side, net tax receipts for the first six months of the current financial year reached Rs 12.65 lakh crore, representing 49% of the fiscal target. Meanwhile, the non-tax revenue reached Rs 3.57 lakh crore by September 2024, achieving 65.5% of the Budget estimate.

The Telecom Regulatory Authority of India has granted a one-month extension to telecom operators, to execute the new traceability mandate for commercial messages, including one-time passwords. Dec. 1 is the new deadline for implementation of the regulation, which is a bid to combat spam and phishing activities, which have risen significantly.

The real estate market in Mumbai has seen a jump in sales this Diwali, with registration of more than 11,800 properties in October so far. Revenue from property registration rose 52% in the festive month, compared to the year-ago period, according to real estate consultant Anarock Research.

In earnings, Larsen & Toubro Ltd.'s consolidated net profit rose 7% in the second quarter of the current financial year, beating analysts' estimates. That’s on the back of a better-than-expected topline performance, with revenue growing 21% during the quarter. The company’s margin contracted more than anticipated to 10.3% though. And order inflow fell 10% to about Rs 80,000 crore. The overall orderbook stood at Rs 5.1 lakh crore at the end of the quarter, with international orders accounting for about 40%.

In more earnings, Biocon's consolidated net profit fell 84.3% in the second quarter, missing analysts' estimates. Revenue only grew 3.7% and the margin contracted to 19.1% from 20.5%, earlier.