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Morning Scan: All the big stories to get you started for the day

A round-up of the biggest articles from newspapers

October 05, 2022 / 07:43 AM IST

Indian equities surge 2 percent to their best in five weeks on strong global cues

India's stock benchmarks rose 2.3 percent, the biggest single-day gain in five weeks, bouncing back strongly after a late selloff on Monday as traders cut bearish bets amid optimism in global equity markets. The benchmark Sensex closed at 58,065.47 points, up 2.25 percent. The 50-share Nifty rose 2.29 percent to 17,274.30 points, its single biggest daily gain since August 30. Banks and metal stocks led the surge.

Why it’s important: The rally indicates short covering by overseas investors, who were net buyers on Tuesday. Upbeat domestic business data released by banks also helped the local stock markets.

Elon Musk again offers to buy Twitter at previously quoted $54.20 per share

Tech billionaire Elon Musk has once again proposed to buy Twitter for the original offer price of $54.20 a share. Musk made the proposal in a letter to Twitter. Shares in Twitter climbed as much as 18 percent on the news. Trading was halted post the offer. Musk showed buyer’s remorse and formally quit the accord in July, and Twitter sued him in court to force him to go forward with the purchase.

Why it’s important: The renewed offer potentially avoids a legal battle over one of the most contentious acquisitions in recent times. Twitter faces a future under a mercurial leader who has publicly questioned its value.

Antitrust regulator approves of Zee-Sony merger with modifications

The Competition Commission of India has approved the merger of Zee Entertainment Enterprises with Sony Pictures Networks India and Bangla Entertainment, both part of the Sony Group, accepting the modifications proposed by the firms to the deal announced in December last year. The modification involves Zee excluding a major general entertainment channel from the transaction.

Why it’s important: The regulator was concerned that India’s largest media merger may give Zee-Sony strong pricing power, hurting the prospects of other TV channels in the entertainment broadcasting industry. The modification seems to have allayed those fears.

Government expects to save Rs 80,000 crore in unused budgeted funds

The central government could save about Rs 80,000 crore in 2022-23 financial year due to under-utilization of allocated funds by various ministries and departments. The savings of over 2 percent on the Rs 39.4 lakh crore budget gives the government some fiscal room to absorb additional demand, helping it stay within the targeted fiscal deficit of 6.4% of GDP.

Why it’s important: The savings would result primarily because of tardy spending by states under some of the centrally sponsored schemes. These savings will ease the country’s fiscal situation.

Overwhelming majority of global CEOs see recession within 12 months

A survey conducted with 1,325 CEOs between July 12 and August 24 by consultancy firm KPMG has revealed that 86 percent of global CEOs believe a recession is coming in the next 12 months, which will make post-pandemic recovery harder. About 58 percent expect the recession to be mild and short. A majority were confident about the global economy's growth prospects over the next three years despite recessionary concerns.

Why it’s important: The concern over recession is expected to lead to job cuts in the short term in many firms. Some have already announced a freeze. Earnings recovery from the pandemic is becoming harder.

Lackluster rural demand sees FMCG sales falter in September

Weak demand in rural areas affected sales of FMCG in September compared to August, which saw heavy stocking ahead of the festival season, according to retail intelligence platform Bizom. Sales in rural areas fell 14.3 percent, while urban sales growth stood at 1.1 percent in September compared to the previous month. Overall FMCG sales fell by 9.6 percent in September compared with August. Rural sales form 65-70 percent of FMCG sales.

Why it’s important: Sales in rural areas were affected owing to excessive rain in some areas and weak rainfall in others, hitting farm yields and household incomes. Grocery stocking across urban and rural areas remain cautious on inflation concerns.

IT hiring boom to end as firms likely to slash campus recruitment in 2023-24

The hiring boom in the software services industry in India during the pandemic is slowing down, with companies likely to slash campus and entry-level hiring by as much as 20 percent in the year starting 1 April, according to leading recruiters. The expanding number of employees awaiting to be deployed in projects and squeezed margins are leading to fewer professional joining the junior ranks.

Why it’s important: As fears of a recession in the US and Europe harden, IT companies have delayed the onboarding of even those they had agreed to hire six months ago. A slowdown in deal activity is not helping.

iPhone sales poised for new record after Apple started making devices in India

Apple is likely to set a new sales record for iPhones in India this year, soon after it began manufacturing the iPhone 14 in the country months ahead of schedule. The company hit an India record for iPhones in 2021 and is expected to cross those numbers this year on the back of strong sales of older devices.

Why it’s important: Although Apple accounts for only about 4 percent of the smartphone market in India, the recent consumer trend of buying premium products is providing a boost to iPhone sales.

Government continues to tighten draft legislation on data protection

The central government is preparing to release a revised draft of the Personal Data Protection Bill for public consultation later this month or in early November. The Bill could be introduced in Parliament in early 2023. This latest version of the Bill, which was first mooted in 2017, is being circulated within the government, and legal opinion has been sought. Certain aspects are being tightened, while some explanatory additions are being made.

Why it’s important: It’s now been five years since the idea of a law to ensure data privacy was first mooted. It has already faced obsolescence in the face of fast evolution in the digital space.

Reliance Jio gears up to test 5G services in four cities ahead of time

Advancing its 5G launch, Reliance Jio will start a beta trial of the service in four cities on Wednesday, offering select customers unlimited data with up to 1 Gbps speed. Jio was scheduled to launch 5G services on Diwali. Bharti Airtel has already announced its 5G launch on October 1. The Jio trial will be held in Delhi, Mumbai, Kolkata, and Varanasi for Jio users and will be extended to other cities progressively.

Why it’s important: India’s telecom operators are racing to launch 5G services as they anticipate robust demand at the top end of the market. 5G is expected to percolate rapidly to all sections of consumers.
Moneycontrol News
first published: Oct 5, 2022 07:43 am