Financial markets in China and Japan are closed today for a public holiday.
Hang Seng is trading with a decline of 0.6%.
In US stock markets, Wall Street indexes ended on a negative note but closed near record highs on Friday, the last trading day of 2021, marking the second year of recovery from a global pandemic.
The Dow Jones Industrial Average fell 60 points, or 0.2%, while the S&P 500 lost 13 points. The Nasdaq Composite dropped 97 points, or 0.6%.
All three major US stock indexes posted monthly, quarterly and annual gains, their biggest three-year advance since 1999.
For 2021, the S&P 500 gained 26.9%, beating both the Nasdaq’s 21.4% rise and the Dow’s 18.7% climb.
Back home, Indian stock markets are business on a positive note,
BSE Sensex is trading up 484 points. Meanwhile, NSE Nifty is trading with a gain of 140 points.
TCS and HDFC Bank are among the top gainers today. On the other hand, IndusInd Bank is the biggest loser today.
BSE Mid Cap Index and BSE Small Cap Index are trading up 0.6% and 0.9% respectively.
All sectoral indices are trading in the green with Automobile sector and Realty sector stocks being the biggest buy.
Shares of eClerx Services and Persistent Systems touched their 52-week highs today.
Rating agency Crisil said that non-banking financial companies (NBFCs) showed resilience in 2021 despite the coronavirus pandemic crisis and expected to see a sustained pick-up in growth this year, the focus will be on finance stocks today.
According to Krishnan Sitaraman, Senior Director and Deputy Director, Crisil, the basic assumption is that the worst-case scenario is behind NBFCs and things will start improving here.
Sitaraman said the Asset Under Management (AUM) of shadow banking players is expected to grow by 6-8% in the current fiscal and 8-10% in the next fiscal.
Rupee is trading at 74.31 against US Dollar.
Gold prices are trading with a fall of 0.1% 48,058 per 10 grams.
Meanwhile, silver prices are trading lower by 0.3%. 62,449 per kg.
Gold is stable today as US Treasury yields offset safe-haven buying sentiment due to an Omicron-driven surge in global COVID-19 infections.
Crude oil prices edged up as the market kicked off 2022 on a positive note, though there were concerns about lack of demand due to the fast-spreading Covid-19 pandemic limiting gains.
In the news for the automobile sector, passenger vehicle (PV) sales declined for the fourth consecutive month in December despite strong demand in the local market. global shortage of semiconductors Tight production in automakers.
Even market leaders Maruti Suzuki and Hyundai Motor India were affected.
The industry estimates that 2,55,000 passenger vehicles were shipped from factories last month, down about 8% compared to 2,77,000 units sold in the year-ago period.
However, the total sales of passenger vehicles in the local market crossed the 3m mark for the third time in the last calendar year, growing by almost 27% to 3.08m. PV sales had earlier crossed the 3m mark in 2017 and 2018.
Automakers in India report bulk remittances made to dealers and not retail to customers.
Nexon SUV maker Tata Motors has overtaken Hyundai Motor to become the second largest seller of PV for the first time in nearly a decade.
Tata Motors boasts of its highest ever monthly sales in December 2021, highest quarterly sales in October-December 2021 and highest annual sales since its inception in 2021.
Meanwhile, Maruti Suzuki sold 123,016 units last month, a decline of 13% as compared to 140,754 units sold in December 2020. The company’s senior executive director Shashank Srivastava said that the shortage of supplies semiconductors Progressively improving. Maruti achieved a little less than 90% of the planned production last month, up from 40% in September and 60% in October.
Srivastava said the demand remains strong with booking inflows, inquiries increasing as compared to last year, there are some uncertainties. These uncertainties include inflation, higher commodity prices and resultant price increases that affect consumer sentiment.
Maruti Suzuki currently has 230,000 units pending orders.
Talking about the news of the power sector, NTPC is one of the most discussed stocks today.
State-run NTPC is looking to acquire a 5% equity stake in Power Exchange of India (PXIL) which offers various power trading options.
PXIL is India’s first institutionally promoted power exchange, providing various power trading solutions since 2008 and connecting buyers as well as sellers.
According to reports, power giant NTPC is considering this decision in view of the government’s intention to increase the market share of total power supply in India to 25% by 2023-24.
NTPC cannot buy more than 5% equity stake in PXIL as it can be either a seller or a buyer on the trading platform.
As per the data available on the portal of Ministry of Corporate Affairs, the authorized share capital of PXIL is 1.2 billion and has paid-up capital 584.7 m
The government intends to increase the share of the spot power market in the total electricity supply in the country to 25% by 2023-24. It is likely to be part of the draft National Electricity Policy (NEP).
How this happens remains to be seen.
NTPC share price is currently trading up 1.2%.
Coming to the power sector, it is interesting to note that the electricity exchange in India accounts for about 4.5% of the total electricity generation, as can be seen in the chart below.
see full image
According to Tanushree Banerjee, co-head of research at Equitymaster, India’s power sector is currently in transition. This is driven by an increasing reliance on short-term contracts and power spot markets.
This transition to the short-term market is due to the dynamics of the rapidly evolving industry.
Tanushree believes that there will be an increase in the quantum of spot power in the Indian power sector due to certain factors.
This article is syndicated from Equitymaster.com
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