Days after auctioning T-bills earlier this week, RBI announced Operation Twist to sell short-term bonds (and buy long-term ones), meaning thereby that the central bank might have bought out the government paper itself. Reading between the lines, the bond mart says it is possible RBI has started financing govt spends, meaning printing money to fund government deficit. That's an idea several economists have been proposing in view of the narrow fiscal room the government has amid the unprecedented economic crisis that Covid-19 has brought upon us.
MARKET CUES: Where we stand >>>  | Nifty futures on the Singapore Exchange traded 40 points lower at 7 am (IST) in signs that the rally on Dalal Street may stall. |
| Nifty50 on Thursday formed a Small Bullish Candle on the daily chart, by filling up the bearish gap area between 9,230 and 9,044 level on a closing basis. Analysts said Nifty needs to breach the 9,350 level for a strong upside. |
| The market's volatility index, India VIX, slipped 8.38 per cent to 39.23 level, falling gradually from last four consecutive weeks, suggesting less fear in the market. |
| Elsewhere in Asia, stocks slipped this morning as investors weighed signs of progress in the fight against the coronavirus against data showing the severity of the impact on economies. Japanese shares dipped along with those in Hong Kong and Korea, while Australian equities edged higher. |
| Wall Street closed little changed on Thursday in the hope a third straight decline in weekly jobless claims signaled the worst of the pandemic's impact on the labor market was over. Dow rose 39.44 points, S&P500 lost 1.51 points, and the Nasdaq 0.63 points. |
| Oil prices rose, gaining further ground as some producers like Kuwait said they would move to cut output swiftly. Brent gained 60 cents to $21.93 a barrel, having climbed 5% on Thursday, while WTI crude rose 66 cents to $17.16. |
| The rupee soared by 62 paise to settle at a two-week high of 76.06 against the US dollar on Thursday tracking gains in domestic equities as hopes of another stimulus package from the government bolstered investor sentiment. |
| LOOK WHO'S |  |
India Inc laps up cheap cash... A host of Indian corporates and PSU are taking advantage of the surplus liquidity in the market by stocking up on cash and issuing bonds. Despite the lockdown, Indian issuers have raised over Rs 30,000 crore — the highest ever — by selling short-term to medium-term bonds. Given the spate of issuances in the pipeline, the total bond collection could go up to Rs 45,000 crore by the end of the month.
Read More Gold headed for Rs 80,000?... As stocks and bonds as investment avenues do not show much hope under current market conditions, gold could be the asset to put your money in. If analysts at Bank of America Securities are to be believed, gold prices in the international market could rally to $3,000 per ounce by end 2021. Translated into Indian rates, that could be about Rs 82,000/10 gm at current exchange rates.
Read More Govt tries to avoid job losses... The government is looking at ways for companies to prevent job cuts through a range of money-saving measures such as a freeze on bonus payments, deferred increase in minimum wages, reduction in overtime payments and longer shift hours. These changes can be implemented through notifications or amendments and could be in place for a one-year period to tide over the economic crisis arising out of Covid-19.
Read More | AND WHO'S |  |
Six debt funds shut... Franklin Templeton Mutual Fund, one of the top fund houses in India, has decided to close down six of its debt funds, which currently manage nearly Rs 25,900 crore in all. The move is due to liquidity troubles in the bond market triggered by Covid-related issues. This is the first time such an incident has happened in India. The closure is effective Friday.
Read More Banks shunning NBFCs... Small NBFCs continued to be shunned by banks, which availed only half of the Rs 25,000 crore refinance offered by RBI for lending to NBFCs. This was despite RBI's attempt to improve the market for long-term bonds. RBI had opened the special facility to provide support to the shadow banks, excluded from the three-month moratorium extended to other businesses.
Read More US unemployment at peak... Unemployment in the US has swelled to levels last seen during the Great Depression of the 1930s, with 1in 6 American workers thrown out of a job by the coronavirus. More than 4.4 million laid-off workers applied for unemployment benefits last week, the government said on Thursday. In all, 26.5 million people — more than the population of the six biggest US cities combined — have now filed for jobless aid in five weeks.
Read More Meanwhile... Washout quarter for insurers... March quarter could be a near-washout for life insurers from a profitability standpoint. These companies together saw significant declines in all financial KPIs be it sum assured, first-year premiums, policies issued, and lives covered in March. The industry of 24 players saw 32.2% year-on-year drop in new premium collection at Rs 25,409 crore whereas the number of policies underwritten and the number of lives covered fell by 66% and 41%, respectively, Irda data showed.
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