Before the news of retrenchments at Sharekhan broke, it looked like the Indian brokerage industry managed to survive the long stock market slump unscathed. But 400 job losses at BNP Paribas' retail broking arm now raises fear of more pain, reminiscent of the 2008 churn. Some top broking firms have been struggling in the past few quarters because of adverse market conditions. Motilal Oswal's trailing 12-month profit fell 46%, while Geojit reported a 61% drop and Emkay 70%. Let's hope a quick market turnaround will spare us the trouble!
STREET PULSE: Where we stand Asian shares were on course for a second straight week of losses on Friday as the release of a whistleblower complaint against US President Donald Trump heightened uncertainties.
Read More  | SGX Nifty traded nearly 15 points down at 7 am (IST), signalling a possible trend reversal on Dalal Street. MSCI index for Asia-Pacific shares outside Japan slipped 0.09%, having fallen 1.4% so far this week, while Japan's Nikkei slid 0.54%. |
| All of Wall Street's major indices ended in negative territory in overnight trade. The Dow fell 79.59 points to 26,891, while the broader S&P500 slipped 0.2% and the Nasdaq 0.6% |
Oil prices steadied off two-week lows as a Pentagon statement intensified concerns of a West Asia conflict and supply disruptions. Brent crude futures fell 0.53% to $62.41 a barrel while WTI crude lost 0.2% to $56.30.
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Super Bullish… Traders carried forward their bullish bets to the October series on expiry of the September derivatives contracts on Thursday on expectations the market could advance further with the government's corporate tax rate cuts reviving sentiment. Analysts said the positions in October series are suggesting traders expect Nifty to touch the 12,000 mark.
Read More Growth Vibes… India's economic growth is likely to look up in the second half of the current financial year as consumer demand is expected to improve, Finance Minister Nirmala Sitharaman said on Thursday. Speaking after an interaction with private banks, NBFCs and other financial institutions, she said lenders told her there was enough liquidity and demand for credit.
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Slowdown Strikes D-Street… Sharekhan, the retail broking arm of BNP Paribas, has asked over 400 employees to leave the firm. A shift to online broking model and shrinking revenues have prompted the brokerage to cut staff cost. Most of the executives who have been asked to leave are part of sales and support functions. A change in the brokerage's growth strategy from a franchise-based model to a digital platform triggered the retrenchments. Insiders said the traditional broking model was struggling to remain profitable because of stiff competition from discount broking firms.
Read More Sebi Signal to MFs… Sebi says mutual funds can't enter any kind of 'standstill agreement' with borrowers, reiterating the primacy of existing rules for financial market entities a day after Subhash Chandra's Essel Group said some funds agreed to further extend the repayment deadline for its outstanding debt. "It is not there in any of the regulations. We have made our position clear," Sebi Chairman Ajay Tyagi said.
Read More Trump Trouble: A whistleblower report released on Thursday said President Donald Trump not only abused his office in attempting to solicit Ukraine's interference in the 2020 U.S. election for his political benefit, but that the White House tried to 'lock down' evidence about that conduct.
Read More Meanwhile...The government wants oil companies to pay Rs 34,000 crore in dividend, profit petroleum and royalty in this financial year, about 15% more than they did last year, in a bid to raise resources for public spending amid economic slowdown and corporate tax cut. The target was fixed ahead of last week's decision to cut corporate tax rate. In 2018-19, the comparative figure was about Rs 29,000 crore, almost half of which came from dividends. ONGC, IndianOil and OIL undertook a combined Rs 9,500 crore share buyback programme last year, allowing the government to offload shares in these companies.
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