Heres a lowdown on top macro triggers that may move market on Wednesday. This report was compiled from agency feeds.
Karnataka Elections: Who Will Be The CM?
The Karnataka Assembly election results threw up an unexpected suspense yesterday as a simple majority eluded BJP and the Congress quickly proclaimed support to third-placed JD(S) to keep the saffron party out of power. All eyes are now on Governor Vajubhai Vala who will have to decide whether to call BJP, the single largest winner of seats, to try to form the government or go with the JD(S)-Congress combine, which together have a clear majority in the 224-member Assembly. Congress had won 37.9% of votes as against BJP's 36.2%. JD(S), headed by former Prime Minister H D Deve Gowda, got 18.4% votes. Gowda's son H D Kumaraswamy is its chief ministerial candidate.
Trade Deficit Widens in April
A sharp decline in gold imports helped keep trade deficit in check in April, even as exports rose at a modest pace in the first month of the new fiscal year. India's exports rose by 5.17% year-on-year to $25.9 billion in April on back of good show by sectors like engineering, pharmaceutical and chemicals, according to the commerce ministry data. Imports during the month were valued at $39.6 billion, up 4.6% over April 2017. The gap between imports and exports or trade deficit was marginally higher at $13.7 billion during April 2018 compared to $13.24 billion in April 2017, the data showed.
Indian Oil Hikes Prices for 2nd Day Running
OPEC's efforts to cut global oil inventories are finally paying off, with Brent crude inching closer and closer to $80 per barrel. In India, on Tuesday, state-run Indian Oil hiked prices of petrol and diesel for the second straight day. The oil company raised the price of petrol by 15 paise a litre and diesel by 23 paise a litre. On Monday, the state-run oil companies had hiked the price of petrol and diesel by 17 paise and 21 paise after a gap of 19 days in view of the Karnataka elections.
Gold Hits Fresh 2018 Low as Dollar Improves
International gold slid more than 1% on Tuesday, falling for a third day to hit its lowest this year as a rise in US. borrowing costs pushed up the dollar and overshadowed the impact of strife in Gaza. Downward momentum in gold picked up after the metal broke below support at its 200-day moving average at $1,306 an ounce. Spot gold lost 1.6% at $1,290.91 an ounce. However, In India gold prices picked up on Tuesday on buying by jewellers. Gold price in the national capital surged by Rs. 165 to Rs. 32,450 per 10 grams.
Allahabad Bank Strips CEO of All Powers
Allahabad Bank board has taken away all executive powers of the bank's chief executive officer Usha Ananthasubramanian, as directed by the government on Monday after the Central Bureau of Investigation named her in the Rs 13,700-crore Punjab National Bank-Nirav Modi fraud. The board has requested the government to make suitable arrangements for smooth functioning of the bank. The CBI chargeshhet in the PNB case, details the alleged role of Ananthasubramanian, and several other bank officials, including two executive directors of PNB — KV Brahmaji Rao and Sanjiv Sharan.
Fight for Essar Steel: ArcelorMittal Pays up Rs 7,000 Cr Dues
Billionaire Lakshmi Mittals ArcelorMittal has cut a cheque of Rs 7,000 crore to clear the dues of its associate companies and to make itself eligible by law to bid for bankrupt Essar Steel. Rival bidder Numetal, which has one of the Ruia family members as a stakeholder, is challenging the banks direction to pay up, said three people familiar with the action. “ArcelorMittal has parked the money in connection with the overdues of two defaulting companies — Uttam Galva and KSS Petron — in the escrow account of the London branch of State Bank of India,” said a banker who didnt want to be identified.
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Dilip Buildcon Inks Pact with NHAI for Rs 6,055-cr Project
The six wholly-owned arms of highways builder Dilip Buildcon has executed contracts with the National Highways Authority of India for road projects aggregating to Rs 6,055 crore. The highway projects will be executed in Karnataka, Telangana, Madhya Pradesh and Maharashtra under hybrid annuity mode.
Orchid Pharma Faces Liquidation
The lenders to Orchid Pharma have rejected the resolution plan of the bankrupt company, a decision that could push the troubled drug-maker toward liquidation. Time was running out for resolving this outstanding debt: The 270- day deadline before which a resolution has to be in place ended on May 14. Orchid Pharma was referred to the bankruptcy court by Lakshmi Vilas Bank after it failed to pay about Rs 3,500 crore to lenders.
NCLT Admits Ericsson's Plea Against RCom
The National Company Law Tribunals (NCLT) Mumbai bench has admitted three insolvency petitions filed against Reliance Communications (Rcom) and its subsidiaries, by telecom gear maker Ericsson, dealing a severe blow to the telcos plans of selling most of its wireless units to Reliance Jio Infocom (Jio). Ericsson had moved the NCLT bench to recover Rs 1150 crore in dues, effectively making the Anil Ambani-owned carrier bankrupt, the second such after Chennai-based Aircel.
Fraud-hit PNB Reports Rs 13,417-crore Q4 Loss
'By December, Expect Midcaps to Outperform'
Rupee Down: The rupee cracked below the 68-mark against the dollar on Tuesday for the first since January 2017, as uncertainty over government formation in Karnataka hit forex market sentiment.
Bonds Down: Government bonds (G-Secs) dropped on sustained selling pressure from banks and corporates. The 7.17% 10-year benchmark bond maturing in 2028 went-down to Rs 95.0975 from Rs 95.60, while its yield moved up to 7.90% from 7.83%. The 6.68% G-Secs maturing in 2031 fell to Rs 88.38 from Rs 88.90, while its yield edged up to 8.12% from 8.05%. The 6.84% G-Secs maturing in 2022 weakened to Rs 95.95 from Rs 96.05, while its yield up to 7.91% from 7.88%. The 6.79% G-Secs maturing in 2027, the 8.20% G-Secs maturing in 2022 and the 8.15% G-Secs maturing in 2022 were also quoted lower to Rs 92.40, Rs 100.9975 and Rs 100.81 respectively.
Call Rates Down: The overnight call money rates finished lower to 5.80% from Monday's closing level of 6.05%. It resumed steady at 6.05% and moved in a range of 6.05% and 5.60%.
Liquidity: The Reserve Bank of India, under the Liquidity Adjustment Facility, purchased securities worth Rs 5,383 crore in 7-bids at the overnight repo auction at a fixed rate of 6% today morning, while it sold securities worth Rs 11,861 crore in 43-bids at the overnight reverse repo auction at a fixed rate of 5.75% as on May 14.