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Weak macros incision Indian equity markets

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Mumbai, Aug 20, 2016: Unable to withstand the jitters of weak domestic macro-economic data and increased chances of a US rate hike, Indian equity markets traded with volatile sentiments to end on a flat-to-negative note in the just-concluded week.

Although the curtailed trading week witnessed a substantial inflow of foreign funds and value buying at lower levels, the markets fell prey to profit booking and a weak rupee, following certain major domestic and global cues.

The 30-scrip sensitive index (Sensex) of the BSE edged down 75.40 points or 0.27 per cent during the week to end at 28,077 points.

Similarly, the wider 51-scrip Nifty of the National Stock Exchange (NSE) slipped by 5.25 points or 0.06 per cent to 8,666.90 points.

“For last few weeks, we have seen that markets have been operating in a range and there is a fine balance between push and pull. This week, the range was even narrower and it continues to remain a tough fight between the bulls and bears,” Pankaj Sharma, Head of Equities, Equirus Securities, told IANS.

“The big development locally was the announcement of merger ratios for State Bank of India (SBI) with its associates,” Sharma said.

“The market reaction to this was positive and it is expected that there are a lot of operational synergies which can be unleashed by cutting unnecessary infrastructure and expenditure.”

The benchmark indices started off the previous week on a negative note as investors were disappointed after key macro-economic data released by the government showed an acceleration in India’s annual rate of inflation based on wholesale prices (Wholesale Price Index).

Other key data — Index of Industrial Production (IIP) for June and Consumer Price Index (CPI) for July — which were released after market hours on Friday last week, also weighed heavy on investors’ sentiments.

According to Dhruv Desai, Director and Chief Operating Officer of Tradebulls, Indian equity markets traded with volatile sentiments during the week mainly due to profit booking at higher levels from traders.

“Sentiments came under pressure after India’s wholesale price index inflation rose at a faster-than-expected pace in July, gaining over three per cent from 1.62 per cent in June 2016,” Desai said.

“However, the Index of Industrial production (IIP) growth surged to 2.1 per cent in June as compared to 1.1 per cent in May, but remained much below the 4.2 per cent growth reported in June 2015, indicating a poor performance of manufacturing sector.”

However, the markets were able to regain momentum as the minutes from US FOMC’s (Federal Open Market Committee) July meeting revealed differences of opinion over raising interest rates.

“Expectations that the central banks would continue to support markets and the Federal Reserve would not hike interest rates anytime soon supported global markets at lower levels. Commodities, especially crude prices that entered bull market too supported the sentiments,” said D.K. Aggarwal, Chairman and Managing Director, SMC Investments and Advisors.

Another major factor that buoyed investors’ confidence was the development on the proposed SBI merger ratio for taking over four banks — three of its associate banks as well as the Bharatiya Mahila Bank (BMB).

“Some support came with Moody’s report on emerging markets highlighting that India is seeing gradual progress on reforms and the country’s outlook will largely be determined by domestic factors,” Desai added.

The ratings agency, in its latest assessment of the global economy, retained India’s growth forecast at 7.5 per cent for 2016 and said that the outlook for emerging market economies has stabilised.

Sentiments also got some support from India Meteorological Department (IMD) reports that monsoon rains in India were 15 per cent above average in the week ended August 10.

Nonetheless, a weak rupee subdued the equity markets, despite healthy foreign money inflow by foreign institutional investors (FIIs) in the domestic market during the week.

The rupee depreciated on a weekly basis, weakening by 17 paise to 67.06 against a US dollar from its previous close of 66.89 on Aug 13.

Provisional figures from the stock exchanges showed that the week witnessed a significant influx of foreign funds worth Rs 1,256.89 crore.

Figures from the National Securities Depository (NSDL) disclosed that foreign portfolio investors (FPIs) were net buyers of equities worth Rs 2,874.23 crore, or $ 430.06 million, on August 16, 18 and 19.

Among the individual Sensex stocks, SBI was the top gainer (up 13.90 per cent at Rs 258.50), followed by Adani Ports (up 7.65 per cent at Rs 273), Tata Steel (up 6.46 per cent at Rs 392.30), Cipla (up 6.17 per cent at Rs 555.55) and ICICI Bank (up 4.81 per cent at Rs 254).

The losers were led by Infosys (down 5.20 per cent at Rs 1,021.10), Wipro (down 4.25 per cent at Rs 520.60), Tata Consultancy Services (down 3.71 per cent at Rs 2,603.95), Sun Pharmaceuticals (down 3.24 per cent at Rs 782.70) and Asian Paints (down 2.92 per cent at Rs 1,111).

IANS

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Kia Motors India sells 1 lakh units since July

Additionally, Kia aims to fully utilise the capacity of 300,000 units per annum at its manufacturing unit by 2022.

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New Delhi: Automobile manufacturer Kia Motors India has sold 1 lakh units since July 2020 in the domestic wholesale market.

Accordingly, the maker of Seltos, Sonet and Carnival, has successfully dispatched 200,000 Kia vehicles to its dealerships across India within seventeen months of sales operations in the country.

The company said the top-end — above GTX variants — for the Seltos, Sonet and the Limousine variant for the Carnival, have accounted for nearly 60 per cent of total cars sold.

As per a statement, Kia sold over 106,000 UVO connected vehicles on the road summing up to a humongous 53 per cent of the brand’s total sales.

Besides, Seltos leads the sales charts for Kia Motors India with 149,428 units, followed by the Sonet with 45,195 units, which was launched in September, 2020 and the Carnival with a total sales of 5,409 units.

“In just over a year of sales operations, Kia has emerged as India’s youngest automobile disruptor and one of the best-selling automobile brands in the country,” said Kookhyun Shim, Managing Director and Chief Executive Officer, Kia Motors India.

The rapid adoption of Kia cars reiterates the evolving customer preference towards a technology-led exceptional driving experience, coupled with great connectivity. Kia’s focus has also been on offering products that are designed to fulfill consumer demands across both urban and rural areas.

Currently, Kia’s manufacturing plant in Anantapur is running on two-shift operations and given the increasing demand for Kia cars, the brand is evaluating operating in three shifts to meet them.

Additionally, Kia aims to fully utilise the capacity of 300,000 units per annum at its manufacturing unit by 2022.

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Petrol, diesel prices remain unchanged at record high levels

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Retail fuel prices were unchanged on Sunday across the four metros. On Saturday, petrol and diesel touched fresh all-time high levels.

In the national capital, petrol was priced at Rs 85.70 per litre. In Mumbai, Chennai and Kolkata, petrol was sold at Rs 92.28, Rs 88.29 and Rs 87.11 per litre, respectively.

Although the pump prices of fuels were unchanged on Sunday, they have been elevated for long and have been touching new highs of late.

Global oil prices are above $55 per barrel currently. Crude prices have remained firm for the last couple of weeks in the wake of unilateral production cuts announced by Saudi Arabia and a pick up in the consumption in all major economies globally.

The last time the retail price of auto fuels were closer to current levels was on October 4, 2018 when crude prices had shot up to $80 a barrel.The current price rise is largely on account of steep increase in central taxes of petrol and diesel and firm crude prices.

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Fuel dearer again: Petrol prices up by 22-25 p/l, diesel by 24-26

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 Petrol and diesel prices rose sharply again on Saturday reaching new all-time highs as oil marketing companies (OMCs) decided to break the pause in revision of auto fuel prices to bridge the widening under recovery.

Accordingly, the pump price of petrol increased between 22-25 paisa per litre across all major metros on the day while diesel prices increased in the range of 24-26 paisa per litre.

With this, petrol is now priced at Rs 85.70/litre in Delhi as against Rs 85.45 a litre previously. Similarly, in Mumbai petrol prices increased to Rs 92.28 a litre, a 24 paisa increase from Friday’s price of Rs 92.04 a litre. In Chennai and Kolkata, petrol is now priced at Rs 88.29 and 87.11 a litre respectively, an increase of 22 and 24 paisa per litre from the previous day’s.

Diesel on the other hand faced sharper increase, rising by 26 paisa a litre in Mumbai from Friday’s level of Rs 82.40 a litre to Saturday’s retail price of Rs 82.66 a litre. In Delhi, diesel rose 25 paisa per litre to Rs 75.88 a litre; in Chennai by 24 paisa per litre to Rs 81.14 a litre and in Kolkata by 25 paisa per litre to Rs 79.48 a litre.

The increase in retail price of auto fuel came on a day when global crude prices showed some signs of softening declining by less than 1 per cent to close to $55 a barrel. Crude price have remained firm for last couple of weeks in the wake of unilateral production cuts announced by Saudi Arabia and a pick up in consumption in all major economies globally.

The increase petrol and diesel prices is fourth such revision this week. The auto fuels had risen sharply by 25 paisa per litre each on Monday and Tuesday before OMCs decided to give relief to consumers from frequent price rise for last two days.

With Saturday’s revision, the pump price of petrol and diesel has now increased by Rs 1.99 and Rs 2.01 per litre, respectively in January so far with OMCs deciding to break an earlier longer period of pause increasing the retail prices first time this year on January 6. The price had been raised on six different days since then.

The last few increases in pump prices in petrol and diesel has taken its price to record levels across the country in all major metro cities and other towns. The last time the retail price of auto fuels were closer to current levels was on October 4, 2018 when crude prices had shot up to $80 a barrel.

The current price rise is largely on account of steep increase in central taxes of petrol and diesel and firm crude prices.

Petrol price was very close to breaching the all-time high level of Rs 84 a litre (reached on October 4, 2018) when it touched Rs 83.71 a litre on December 7, 2020. But the march had been halted ever since then with no price revision by the OMCs in the month. The price rise started again only on January 6.

Oil companies executives said that petrol and diesel prices may increase further in coming days as retail prices may have to be balanced in line with global developments to prevent OMCs from making loss on sale of auto fuels.

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