Indian equity investors experienced a significant loss of 16.32 lakh crore due to a two-day stock market decline fueled by escalating geopolitical tensions involving the US, Israel, and Iran.
Analysts predict India will face oil price volatility and macroeconomic effects due to the escalating Iran crisis, though the country's oil supply chain is not yet structurally insecure.
The banking sector in the country is stable, capital is available and credit offtake is poised to take off, he said at a webinar organised by Bharat Chamber of Commerce. "We are not unique to the phenomenon of uncertain growth and high inflation due to the pandemic.
India's trade account could come under pressure and there could be an inflation push if crude oil prices remain above the $90 per barrel (Brent) for a prolonged period since India imports over 85 per cent of its oil and roughly 50 per cent of its gas. A rebound in economic activity is bound to lead to higher fuel demand. While India is the third-largest importer of crude, it is a net exporter of refined products, which helps to compensate to some degree.
Rising geopolitical uncertainty, a falling dollar and the growing speculative interest in commodities trading will keep crude prices volatile.
Among the Sensex firms, HDFC Bank emerged as the biggest loser, falling 4 per cent. JSW Steel, Reliance Industries, UltraTech Cement, Maruti, Tata Steel, Wipro, Tech Mahindra, Bharti Airtel and Larsen & Toubro were the other major laggards. Power Grid, Asian Paints, Sun Pharma, Axis Bank, NTPC, ITC and Infosys were among the gainers.
The Indian economy will grow at around 6.5 per cent in the current fiscal, notwithstanding high crude oil prices and increased uncertainty due climate changes, NITI Aayog member Arvind Virmani said on Thursday. Virmani also asserted that the gross household savings ratio in India has consistently gone up. In an interview with PTI, he said: "My growth projection (of India's GDP growth) is 6.5 per cent plus minus 0.5 per cent... because my experience is that the fluctuations in global GDP more or less has balanced out for us, assuming normal changes."
India's economic growth will be above 6 per cent in the current fiscal as the country has managed to strengthen its macroeconomic stability and performance even in a period of large global shocks, RBI Monetary Policy Committee (MPC) Member Ashima Goyal said on Monday. Goyal further said that a global slowdown reducing India's export growth, geopolitics fueling oil and food prices, and erratic weather are some of the continuing risks that the country faces. "India has managed to strengthen its macroeconomic stability and performance even in a period of large global shocks.
Petrol and diesel prices are unlikely to be increased despite firming raw material costs because of upcoming general elections next year, Moody's Investors Service said. Three state-owned fuel retailers -- Indian Oil Corporation (IOC), Bharat Petroleum Corporation Ltd (BPCL) and Hindustan Petroleum Corporation Ltd (HPCL) -- which control roughly 90 per cent of the market, have kept petrol and diesel prices on freeze for a record 18 months in a row. This is despite the raw material (crude oil) cost surging last year, leading to heavy losses in first half of 2022-23 fiscal year before easing oil prices propelled them to profitability.
If a 5% to 10% fall in the equity market gives you sleepless nights, you are not cut out for a 75% to 80% allocation to equities and must reduce it.
The Indian aviation sector is on the cusp of a change as airlines look to induct a record number of aircraft. This, analysts said, will put the sector on a growth runway, though keeping it viable for only long-term investors. According to Vinit Bolinjkar, head of research at Ventura Securities, expectations of strong air traffic, coupled with low penetration, is the prime reason for a solid long-term outlook.
Markets this week would be guided by the ongoing quarterly earnings, macroeconomic data announcement and global trends, analysts said. The government will release industrial production data for June and inflation data for July this week. The RBI has revised its retail inflation forecast to 5.7 per cent, up from the earlier 5.1 per cent due to price pressure on account of supply constraints and high crude oil prices.
The windfall taxes on domestic crude oil production and fuel exports will generate close to $12 billion (Rs 94,800 crore) for the government in the remainder of the current fiscal while trimming profits of firms such as Reliance Industries Ltd and ONGC, Moody's Investors Service said Tuesday. On July 1, the government imposed windfall gain taxes on the export of petrol, diesel and aviation turbine fuel (ATF), and on the domestic production of crude oil. It has also mandated exporters to meet the requirements of the domestic market first.
High crude oil prices, which the central bank perceives as a risk to inflation, may limit the extent of rate cut to 25 basis points rather than 50 bps, economists said.
The market breadth in BSE remained dismal with 2,210 shares declining and 649 shares advancing.
So which sectors are likely to do well in 2022? Should you focus on domestic economy-related sectors or export-oriented ones?
With the West Asian/North African crisis not likely to end soon and investors' appetite increasing for gold, it is expected to touch $1,600 an oz by the year-end.
High crude oil prices, widening current account gap and political uncertainty may keep the rupee weak in the near term.
'I don't see any major setback for the Indian markets post the US Fed event.'
Naresh Nayyar, MD & CEO, Essar Oil, tells Business Standard that a windfall profit tax on private oil companies will only worsen the situation.
High crude oil prices in 2008 have left the government richer by a few thousand crore rupees. In 2008-09, the government earned "windfall profits" from the petroleum sector as crude oil prices spiked, touching a high of $147 in July 2008.
RIL is doing better than the regional benchmark due to its ability to process heavy and sour crude, coupled with the higher product prices of petroleum products in the overseas markets. The company's GRMs were $13.6 a barrel in Q2 FY08. Analysts at domestic brokerage houses are estimating the GRMs of Reliance Industries at $14-$15 a barrel compared with the regional benchmark Singapore refining margin of $8 a barrel last month.
The sharp downward swing in market sentiment in the past six months has rendered stock valuations attractive. Here are some stocks experts say will deliver handsome returns.
The bulls in the markets seem to be back on track in the last week, after a largely bearish sentiment prevailed in the past few trading sessions.
State-owned Oil and Natural Gas Corporation has been ranked among the top 25 energy firms in the world.
India's net oil import bill has jumped 32 per cent to Rs 91,486 crore (Rs 914.86 billion) in the first 11 months of 2004-05 fiscal on back of high crude oil prices.
Will 2022 be a year of contrasting narratives -- one filled with caution and the other with continued optimism?
Modi made a strong case for a partnership between the producers and consumers in the oil market as it exists in other markets.
Higher levels could not be sustained as participants offloaded their long positions in view of September series expiry.
Five to six issues may hit the market if Chalet Hotels's IPO is successful and if there are no negative surprises in the Union Budget on February 1.
Large trade deficit and rupee decline against the US dollar are putting pressure on the CAD, and these steps are likely to have a positive impact on the external sector.
Apart from this, state refiners are looking at optimising crude oil inventory levels without in any way affecting fuel supplies in the domestic market.
'A growth of above 7 per cent when the fundamentals of the economy are becoming stronger still makes India the fastest growing large economy.'
Monetary Policy- Easing expected to happen later this financial year.
Pressure has been mounting on the Reserve Bank of India to cut interest rates in the wake of declining retail inflation and the need to fuel growth momentum. However, the RBI will have to do a tightrope walk as globally interest rates are inching upwards.
The firm would require it to more than triple its CAGR of revenue to 18.5% for the next decade from 6%
Research and ratings agencies like Icra and Moody's have said the CAD in 2018-19 would be much higher than 2017-18
The task of Union Finance Minister Arun Jaitley to keep inflation under check, even when the country reeled under severe drought for two years in a row, and reduce the current account deficit, was made easier by low crude oil prices.
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