The Nikkei is down 0.2% while the Hang Seng is up 0.3%. Shanghai Composite is trading with a gain of 0.8%.
In US stock markets, Wall Street indexes closed at all-time highs on Wednesday on boost from retailers including Walgreens and Nike, as investors brushed off concerns over Omicron’s spread.
The Dow Jones Industrial Average rose 0.3% while the Nasdaq fell 0.1%. The S&P 500 rallied 0.1% to new highs.
With this, the Dow has now risen in six straight trading days, marking the longest streak of gains this year since the seven sessions that ran from March 5 to March 15.
Back home, Indian stock markets are trading on a flat note.
BSE Sensex is trading up 69 points. Meanwhile, NSE Nifty is trading with a gain of 17 points.
Wipro and HCL Tech are among them Today’s Top Beneficiaries, On the other hand, Bajaj Finserv is one of the top losers today.
BSE Mid Cap Index and BSE Small Cap Index are trading up 0.1% and 0.4% respectively.
Sectoral indices are showing buying interest along with stocks in the telecom sector and the IT sector.
On the other hand, realty stocks and energy stocks are trading in the red.
Shares of Suzlon Energy and ESAB India today hit 52-week high.
Rupee is trading at 74.53 against US Dollar.
Gold prices are trading lower by 0.2% 47,749 per 10 grams.
Meanwhile, silver prices are trading with a fall of 0.4%. 61,593 per kg.
In global markets, gold prices held steady above the key US$1,800 an ounce level as a weaker US dollar, making bullion attractive to holders of other currencies, balanced pressure from firm Treasury yields that eroded the metal’s appeal. Does.
Crude oil prices rose for several days in a row today, buoyed by data showing US fuel demand well-being despite rising Omicron coronavirus infections.
In PSU sector news, State-owned power producer SJVN on Wednesday said it would invest $600 billion to harness 5,097 megawatts (MW) of hydroelectric power in Arunachal Pradesh.
The company’s Chairman and Managing Director Nand Lal Sharma held a meeting with the Deputy Chief Minister in New Delhi to discuss the road map for the development of hydel projects.
Sharma said that a temporary investment is involved in the development of these projects. 600 billion and will be commissioned by SJVN in the next 8-10 years.
He said that when commissioned, these projects are expected to generate around 20 billion units of clean energy annually on a cumulative basis.
Note that SJVN has set an ambitious target of achieving an installed capacity of 5,000 MW by 2023, 12,000 MW by 2030 and 25,000 MW by 2040.
How this happens remains to be seen.
In other news Bharat Petroleum Corporation (BPCL) share price is in focus today.
LIC, the country’s largest insurance company, has acquired 2.02% stake in the state-owned petroleum refinery company through an open market transaction.
With this the stake of LIC in BPCL has increased from 5.01% to 7.03% now.
Meanwhile, uncertainty looms over BPCL’s privatization, the government’s disinvestment target. 1.75 tonne is not likely to be available for FY 2022.
The Center may lower its target of disinvestment proceeds in the Revised Estimates even as it is on course to launch LIC’s initial public offering (IPO).
Reports stated that While the LIC IPO is scheduled to be completed before March 2021, the planned privatization of BPCL may extend to the next financial year.
This implies that when Finance Minister Nirmala Sitharaman presents the Union Budget for 2022-23, the revised estimate for disinvestment could be approx. 500 billion less than the budget estimate for 2021-22.
Due diligence for the sale of BPCL has taken longer than expected. Interested bidders had access to the refiner’s financial data in April, but due diligence has been delayed due to disruptions caused by the pandemic.
Coming to PSUs, take a look at the chart below which shows the performance of BSE PSU Index vis–vis BSE Sensex over the years.
As can be seen from the chart above, over the past decade, 100 rupees invested in BSE PSU index will fall 80, compared to almost 3x gains for the Sensex.
Here’s what Richa Agarwal, Lead Smallcap Analyst at Equitymaster, wrote about PSU stocks in an edition of Profit Hunter:
However, it would be foolish to paint all PSUs with the same brush. There are exceptions in this area, which put their personal peers to shame.
In a recent editorial, I shared an opportunity in a PSU stock that is riding and enabling an irreversible megatrend – digitization.
Moving on to news from the banking sector, The Reserve Bank of India (RBI) on Wednesday said the gross non-performing assets (GNPA) ratio of scheduled commercial banks may rise to 9.5% in September 2022 from 6.9% in September 2021.
In its 24th issue of the Financial Stability Report (FSR), the RBI said that scheduled commercial banks will, however, have sufficient capital both at the aggregate and individual level, even under stress conditions.
The capital to risk-weighted asset ratio (CRAR) of scheduled commercial banks rose to a new peak of 16.6% and their provision coverage ratio (PCR) stood at 68.1% in September 2021.
In the report, the central bank said that the global recovery in the second half of 2021, affected by a resurgence of infections in many parts of the world, is losing momentum and supply disruption,
Inflationary pressures are adding to the pressure.
Here is an excerpt from the report,
Bank credit growth, led by the retail sector, is showing signs of a gradual recovery, although credit flow to low-rated corporates remains hesitant. The micro, small and medium enterprises (MSMEs) as well as the micro finance segment are showing signs of stress.
We will keep you informed about the latest developments in this field. stay tuned.
This article is syndicated from Equitymaster.com
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