August 5, 2019 / 3:32 AM / 15 days ago

Morning News Call - India, August 5

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FACTORS TO WATCH

11:00 am: Parliament session continues in New Delhi.

LIVECHAT - MARKETS WEEK AHEAD

Mike Dolan, Reuters EMEA Markets Editor, evaluates the state of European markets at the staart of a crucialweek for central bank policy at 3:30 pm IST. To join the conversation, click here refini.tv/2P8N0Wp

INDIA TOP NEWS

• EXCLUSIVE-India’s biggest carmaker Maruti Suzuki cuts temporary jobs as sales plunge

India’s biggest automaker, Maruti Suzuki India, said it had cut the number of its temporary workers to cope with a slowdown in auto sales, adding to the jobless problem in Asia’s third largest economy.

• State Bank of India warns of muted credit growth, misses quarterly profit estimates

State Bank of India joined its peers in flagging concerns about tough domestic economic conditions and the stress the auto sector is under, as the country’s largest lender by assets missed expectations for quarterly profit.

• INSIGHT-How a shadow banking crisis sent India’s autos sector into a tailspin

Across India dealerships are being pushed out of business and the Indian auto sector is going through its biggest slump in nearly two decades. Passenger vehicle sales fell for eight straight months until June, and in May sales dropped 20.55% - the sharpest recorded fall in 18 years.

• Amazon in talks to buy stake in India’s Reliance Retail - sources Amazon.com is in talks with Reliance Industries’ retail unit to buy a stake in India’s biggest brick-and-mortar retailer, two sources with knowledge of the talks told Reuters on Friday.

• India’s Mindtree names former Cognizant executive as CEO

Mindtree on Friday named former Cognizant executive Debashis Chatterjee as its new managing director and chief executive officer.

• India likely to put 35% minimum shareholding rule for listed entities on hold - source

The Indian government is likely to put on hold a plan to raise the minimum public shareholding in listed companies, a source with direct knowledge of the matter said, amid concerns it could force the issuance of billions of dollars worth of shares.

• Indian bankers worry DSP’s legal action will delay rescue of DHFL-sources

The resolution plan of one of India’s biggest shadow banking firms, Dewan Housing Finance, may be delayed as its creditor DSP Mutual Fund has initiated legal proceedings against it, two banking sources told Reuters.

• Jet Airways extends deadline for initial bids to Aug. 10

Jet Airways has extended the deadline for initial bids for the bankrupt airline to Aug. 10 from Aug. 3, a statement from the company said on Saturday.

GLOBAL TOP NEWS

• Democrats aim their outrage at Trump after two mass shootings

Two mass shootings that killed 29 people in Texas and Ohio reverberated across the U.S. political arena on Sunday, with some Democratic presidential candidates accusing President Donald Trump of stoking racial divisions while he said “hate has no place in our country.”

• Iran seizes Iraqi oil tanker smuggling fuel in Gulf -TV Iranian Revolutionary Guards seized an Iraqi oil tanker in the Gulf which they said was smuggling fuel and detained seven crewmen, Iran’s state media reported on Sunday, in a show of power amid heightened tension with the West. • HSBC announces surprise exit of CEO Flint, up to $1 billion buyback HSBC announced the surprise departure of Chief Executive Officer John Flint, saying the bank needed a change at the top to address “a challenging global environment”, even as it posted a 16% rise in half-yearly profit.

LOCAL MARKETS OUTLOOK

(As reported by NewsRise)

• SGX Nifty nearest-month futures were trading 0.7% lower at 10,942.50.

• The Indian rupee is expected to open lower against the dollar as last week’s escalation of the U.S-China trade tensions prompted the Chinese yuan to slip below 7 for the first time since 2008. • Indian government bonds are likely to open lower as the rupee is expected to fall below 70 per dollar amid ongoing trade tensions between the U.S. and China.However, fall in U.S. Treasury yields, lower crude oil prices and position building ahead of India’s rate-setting panel’s policy decision this week are likely to cap any major fall, dealers said.The yield on the benchmark 7.26% bond maturing in 2029 is likely to trade in a range of 6.34%-6.40% today.-NewsRise

GLOBAL MARKETS

• Wall Street extended its sell-off on Friday on renewed trade fears as the benchmark S&P 500 index and Nasdaq saw their worst weekly percentage plunges since December, when investors were spooked by the prospect of a looming recession.

• Asian shares slid to 6-1/2-month lows and the yuan plunged as a rapid escalation in the Sino-U.S. trade war drove nervous investors to safe-havens such as the yen, bonds and gold.

• China’s yuan tumbled more than 1% to 11-year lows on mounting fears over a sharp escalation in the U.S.-China trade war, sparking a sell-off in other currencies in the region.

• U.S. Treasury prices rose on Friday, with 10-year yields posting their steepest weekly drop since 2012, as fears about the escalating U.S.-China trade war offset reassuring U.S. labor market data.

• Oil prices fell amid concerns about weaker crude demand after U.S. President Donald Trump said he would impose tariffs on more Chinese imports, potentially ramping up a trade war between the world’s two largest economies.

• Gold prices edged higher, helped by a weaker dollar and escalating trade tension between the United States and China.

For additional data:

India govt bond market volumes

Stock market reports

Non-deliverable forwards data

Corporate debt stories [IN CORPD]

Local market closing/intraday levels [IN SNAPSHOT]

Monthly inflows [INFLOWS RTRS TABLE IN]

$1= 69.39 Indian rupees Compiled by Priyanka Das in Bengaluru

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