Rise With Profit: US Market Fall, CLSA's India Pivot, Zepto's Fundraise Plans | Podcast

This is the daily morning update from NDTV Profit and I’m Alex Mathew. Here’s everything you need to know at the start of the new week.

The discourse globally is centred around what’s happening in the US market and with the dollar. The greenback has continued to climb and now the dollar index has risen above $106. This has been coupled with a rise in bond yields. Last I checked, the yield on the 10-year treasury was at 4.44%, up from close to 4% just about a month ago.

Stronger dollar and higher bond yields in the US have meant an outflow from emerging markets, including India. In fact, even Wall Street saw selling at the end of the week—with the Dow dropping over 300 points and the S&P 500 and Nasdaq dropping 1.3% and 2.2%, respectively.

What all of this means is that there could still be a fair bit of volatility to contend with at the start of the new week for Indian equity markets, despite analysts pointing out that we are in oversold zone.

Now, amid the heavy selling by foreign institutional investors in India, one house has made an about turn of sorts. CLSA is shifting its tactical allocation back to India from China. The Trump win has complicated some expectations of a rise of China’s economy. The analysts at CLSA are, therefore, reversing their tactical allocation in early October, returning to a benchmark on China and a 20% overweight on India.

In the Asia Pacific region this morning, the three early risers were trading mixed last I checked. The Nikkei 225 in Japan was lower by 0.7%, while the Australian benchmark was flat and the Kospi in South Korea was higher by over 2.5%.

In the top news back home, prices of compressed natural gas, especially in Mumbai and Delhi could be hiked by Rs 6-8 per kg soon. The key driver of this price hike is the reduction in domestic gas allocation for companies like Mahanagar Gas Ltd. and Indraprastha Gas Ltd., whose main operating regions include these two cities.

In corporate news, Vodafone Idea's Rs 25,000-crore fundraise plan is delayed as lenders are in "wait and watch" mode over AGR dues payable to the government. Akshaya Moondra, the chief executive officer, said that the company remains actively engaged with its lenders for the debt raise, and that he is personally in talks with them for this.

An interesting update has come through from Bank of India. The Managing Director and Chief Executive Officer Rajneesh Karnatak expects the lender's corporate credit book to grow in double-digit numbers during the second half of this year.

In other news, Zepto is set to raise $300 million or about Rs 2,500 crore from domestic high net worth individuals and family offices, as it aims to strengthen its war chest. The company plans to raise about Rs 2,500 crore at the same $5 billion valuation, at which it raised over a $1 billion earlier in the year. Family offices like Motilal Oswal’s Raamdeo Agrawal and Manipal Group’s Ranjan Pai are set to take part in the round, according to people familiar with the matter.

In national news, the Supreme Court is scheduled to hear a plea today, seeking enforcement of measures to curb air pollution in Delhi. The capital city experienced toxic air conditions on Sunday, as the air quality index was recorded in the 'severe' category. It was announced over the weekend that there would be online classes for all students except for classes 10 and 12.

In fact, the air quality panel there has also announced stricter measures under Stage 4 of the Graded Response Action Plan, which is effective from 8 a.m. Monday morning. That includes a ban on truck entry and a temporary halt on construction at public projects.

And finally, in a major boost to its military prowess, India has successfully flight-tested a long-range hypersonic missile off the coast of Odisha. The missile has a range of over 1,500 kilometers. This puts India in a select group of nations having a weapon that can strike with extreme speed and evade most air defence systems.