Every crisis changes the pecking order in the market and a new set of leaders emerges. In the 90s, it was oil and gas, then it was IT before the tech bubble, infrastructure and metals in 2003-07, pharma after the Global Financial Crisis, and financials in last five years. Now, that is poised for a shakeup, and requires investors to do some sectoral rebalancing. Some analysts point out that asset class-wise too, RBI measures have created an opportunity in debt to make 7-8% yields over next two-three years. Thus, some allocation to fixed income may also be in order.
STREET PULSE: Where we stand Nifty futures on the Singapore Exchange traded some 50 points lower at 7am (IST), signalling a negative start ahead for Dalal Street. Elsewhere in Asia, shares slid as fears mounted that the global shutdown for the coronavirus could last for months.
Read More  | Japan's Nikkei 3.2 per cent. MSCI's broadest index of Asia-Pacific shares outside Japan eased 0.2 per cent while South Korea shed 2.7 per cent. |
| Wall Street stocks tumbled on Friday, ending a massive three-day surge after doubts about the fate of the US economy resurfaced and the number of coronavirus cases in the country climbed. The Dow slumped 4.06 per cent to 21,636 while the S&P500 lost 3.37 per cent to 2,541 and the Nasdaq 3.79 per cent to 7,502. |
| Oil prices slumped in Asian trade, tracking falls on stock markets after a sharp escalation in the coronavirus crisis over the weekend. WTI crude fell 3.9 per cent to $20 a barrel, while Brent was off 4.9 per cent at $23. |
| The rupee pared its initial gains to settle 27 paise higher at 74.89 against the US dollar on Friday after RBI announced various measures to stimulate growth amid coronavirus-induced lockdown in the country. |
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MARKETS BRACING FOR RECESSION?... Delivery-based trades in India are rising, indicating that a section of the market is factoring in a major recession and wants to eject at the first opportunity. Delivery percentage on the NSE and BSE reached 36.87% in March, higher than their long-term average. Indian markets have lost more than half a trillion dollars in market capitalisation since the Covid-19-induced selloff began late February. Average daily turnover of the cash segment at the NSE and BSE rose 39% and 57% in March, compared with their respective one-year average.
Read More STOCKS BOUNCE MAY BE SHORT-LIVED!... The 14% bounce in Indian stock indices in the last four sessions could face hurdles in the days ahead amid rising cases of coronavirus in India and elsewhere. Analysts expect Nifty to fall back below 8,000 levels and even touch 7,500, as the global economy faces its worst phase since the global financial crisis of 2008-09.
Read More STRESS SHOWING IN PMS…The PMS business of Mumbai-based brokerage India Nivesh has become the first casualty of the turmoil in the stock market in the past 40 days triggered by the spread of coronavirus. The firm is shutting down its fund management unit for rich clients amid speculation the group has not been able to recover a loan to the promoter of a retail company following the plunge in stock prices.
Read More LOOK, WHAT'S FPIs DUMPING…FPIs have sold shares of banks, financial services, energy and IT in the first fortnight of March, according to data from the NSDL. Nearly 75% of the FPI outflow from Indian equities during March 1-15 was from these four sectors. FPIs have sold shares worth Rs 25,000 crore between March1and 15 and the outflow is likely to continue in the near term due to redemption in arbitrage funds and impositions of dividend tax from April 1, said fund managers.
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E-COMM BACK IN ACTION… India's top online grocers and e-retailers said they have restored operations in larger cities but are still hobbled by the massive backlog of orders and shortage of workers triggered by the ongoing nationwide lockdown to stem the tide of Covid-19. E-grocers BigBasket and Grofers, ecommerce firms Amazon and Flipkart, as well as B2B platforms Jumbotail and Udaan cautioned consumers and kirana stores to expect delayed deliveries as they deal with operational upheaval caused by the restriction on manufacturing and movement of goods and people.
Read More RULE TWEAK FOR FPIs…. Five multinational banks, handling funds and securities of FPIs, have alerted the Indian capital market regulator that several foreign funds, caught in the Covid-19 situation, will be unable to renew their licence unless some of the rules are changed. In a joint letter to Sebi, Deutsche Bank, Citi, JP Morgan Chase, Standard Chartered and HSBC — which act as custodian banks — have asked the regulator to allow scanned copies of documents and emails for renewing registration, registering new funds, and opening bank accounts.
Read More RELIEF AS CSR SPEND… The government on Sunday said contributions by companies to the newly-set up prime minister's emergency relief fund will qualify as their mandatory corporate social responsibility spending. "CSR Funds can now donate to PM-CARES Fund. Ministry of corporate affairs notifies details," finance minister Nirmala Sitharaman said in a tweet on Sunday. Earlier in the day, the ministry of corporate affairs issued an office memorandum to this effect.
Read More Meanwhile... BIG HIT ON MSMEs... More than one-fourth of India's 69 million MSMEs may shut shop if the lockdown extends beyond four to eight weeks, as a majority of them will have a cash crunch, said Ravi Venkatesan, chairman, Global Alliance for Mass Entrepreneurship. Citing data available with All Indian Manufacturers' Association, Venkatesan said "that 19% to 43% of the MSMEs may disappear if the crisis persists 4 or 8 weeks".
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