Sensex is just shy of a record high mark when GDP growth is hovering around 5%. Has the market been euphoric? While depressed economic growth may make stocks look pricey, they need to be seen in the light of the abundant liquidity that has skewed the balance between growth vs valuation in favour of the latter. It is this surge in liquidity which is making the market repeatedly look up for green shoots instead of looking down.
SGX Nifty traded some 20 points lower at 7 am (IST), signalling indecisiveness on Dalal Street. Elsewhere, shares slid on Thursday as a fresh row between Washington and Beijing over a US bills on Hong Kong could complicate their trade negotiations and delay a "phase one" deal.
HERE'S WHAT TO WATCH  | MSCI index for Asia-Pacific shares outside Japan fell 0.16% while Japan's Nikkei dropped 0.25%. |
| On Wall Street, all three major indexes fell, with the S&P 500 losing 0.38%. Dow fell 112.93 points to close at 27,821, while the Nasdaq fell 0.5% to end the day at 8,526. |
| Oil prices retreated on Thursday as a spat over Hong Kong added to worries of a delay in any US-China trade deal, after posting steep gains in the previous session on bullish US crude inventory data. Brent crude futures fell 25 cents to $62.15 a barrel while WTI crude futures dropped 20 cents to $56.81 |
| The Indian rupee tumbled 10 paise to close at 71.81 against the US dollar on Wednesday, in lock-step with weak Asian currencies following a flare-up in US-China tensions. |
| LOOK WHO'S |  |
Blockbuster Disinvestment... The government has lined up the sale of five PSUs, including majority stakes in bluechip oil company BPCL and Shipping Corporation. Also on sale will be a 31% stake in Container Corporation of India along with management control. Based on current market prices, the sale of stakes in these three companies will fetch the government about Rs 78,400 crore, taking it close to the disinvestment target for the fiscal year.
Read More Telecom Relief... The Cabinet has cleared a two-year moratorium on spectrum payments, which will give immediate relief of more than Rs 42,000 crore to India's three mobile phone companies, two of which — Bharti Airtel and Vodafone Idea — have been struggling with high debt and huge losses amid brutal competition. Thus, Vodafone Idea, Bharti Airtel and Reliance Jio would need to make the next spectrum payment to the government only in fiscal 2022-23. Besides the spectrum payments, Vodafone Idea and Airtel also need to pay a combined Rs 89,000 crore in licence fees, spectrum usage charge, penalties and interest towards AGR dues.
Read More Full Steam on Labour Reforms… The Union Cabinet has approved the Labour Code on Industrial Relations 2019, allowing companies to hire workers on fixed-term contract of any duration. The code has retained the threshold on the worker count at 100 for prior government approval before retrenchment, but has a provision for changing 'such number of employees' through notification. Fixed-term employment means a worker can be hired for any duration, three months or six months or a year depending on season and orders. The bill is expected to be tabled in the ongoing winter session of the Parliament.
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RBI Intervenes in DHFL... The central bank has superseded the board of the troubled mortgage lender, citing "governance concerns and defaults" and said it would start insolvency proceedings against it. RBI appointed R Subramaniakumar, former MD of Indian Overseas Bank, as administrator and said it would ask NCLT to appoint him as the resolution professional for the insolvency process. DHFL has become the first non-bank lender to be sent to the NCLT under the IBC following a November 15 notification by the corporate affairs ministry.
Read More ZEE Deal… ZEE promoters are looking to sell up to 16.5% of their stake in the media company to repay lenders. Of the total promoter stake earmarked for the sale, up to 15.72% will change hands in block deals on Thursday. According to a term sheet, three promoter companies EMVL, Cyquator and Essel Corporate will sell 15.72% of the equity base at an indicative price of Rs 277 per share, translating into a 10% discount to Wednesday's closing price at Rs 307 apiece. At the floor price, the value of the 15.72% stake is worth nearly Rs 4,132 crore.
Read More Sebi Fiat… Sebi said listed companies will have to inform stock exchanges about defaults on interest or loan repayments to banks and financial institutions after 30 days. The regulator has also tightened rules for PMSes and shortened the timeline for rights share offers. The stricter PMS rules are aimed at reducing mis-selling. Net worth requirement for them has been doubled to Rs 5 crore from Rs 2 crore, while the minimum investment ticket size for such products has risen to Rs 50 lakh from Rs 25 lakh. Broker commission has also been tightened.
Read More Meanwhile... The US House of Representatives on Wednesday passed two bills intended to support protesters in Hong Kong and send a warning to China about human rights. The legislation, which has angered Beijing, raising concerns that it could complicate their trade negotiations and delay a "phase one" deal. Trade experts and people close to the White House said completion of a "phase one" US-China trade deal could now slide into next year.
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