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US Stocks: Wall St heads for mixed open as rate worries linger

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Wall Street’s main indexes were set for a mixed open on Thursday as a slew of economic data pointed to resilience in the U.S. economy, likely keeping the Federal Reserve on track for aggressive interest rate hikes to tame inflation.

U.S. retail sales unexpectedly rose 0.3% in August as lower gasoline prices supported spending, data showed, in a sign that the economy could tolerate higher interest rates as the Fed tightens monetary policy.

“The economic conditions are quite good in the U.S. and it’s pretty compatible with the path of the 75-basis-point hike for the next meeting,” said Mabrouk Chetouane, head of global market strategy at Natixis Investment Managers Solutions.

“If investors are still underestimating the Fed’s determination to fight against inflation, one of the key concerns is that we’ll see volatility increase in the coming weeks.”

The CBOE Volatility index, also know as Wall Street’s fear gauge, edged up to 26.19 points, above its long-term average of 20.

The main stock indexes closed slightly higher on Wednesday after wavering throughout the session as an on-target inflation print provided relief after Tuesday’s hotter-than-expected consumer prices data sparked the biggest percentage decline on Wall Street since June 2020.

Investors fear steep rate hikes by the Fed will drive the economy into a recession, with many market observers concerned over the lagging effects of the central bank’s tightening phase.

Also Read: US stocks suffer their worst day in more than two years

Money markets are pricing in a 74% chance of a 75-basis-point hike, while placing 27% odds of a 100-bps hike next week.

The yield on two-year Treasury notes, a bellwether for interest rate expectations, touched new 14 year highs at 3.85%.

Shares of rate-sensitive growth and technology stocks slipped alongside a rise in bond yields.

Apple Inc, Meta Platforms and Tesla Inc were down 0.2% in premarket trading. Netflix Inc , however, gained 2.7% as Evercore ISI upgraded the stock to “outperform”.

At 08:53 a.m. ET, Dow e-minis were up 55 points, or 0.18%, S&P 500 e-minis were down 1.75 points, or 0.1%, and Nasdaq 100 e-minis were down 21.25 points, or 0.17%.

Union Pacific and CSX Corp jumped nearly 3% each after U.S. railroad operators and unions secured a tentative deal to avert a rail shutdown that could have hit food and fuel supplies across the United States.

Adobe Inc slumped 10.2% after the photoshop maker said it would buy Figma in a cash-and-stock deal that valued the online design startup at about $20 billion.

How to tide stock market volatility: Invest in Nifty on meaningful correction to create long-term wealth

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By Manish Jain

2022 has been anything but kind to the global economy. The US is slowly slipping into a recession, the European economy is in shambles and China stares at a stagflation sort of situation. The issues at hand are the fragile geo-political situation, the Russia-Ukraine war, and the pandemic, which has all taken a toll on the global economy. US GDP has already witnessed two successive quarters of negative growth, the EU has been flattish but waiting now to slip into a negative zone and China, which witnessed an abysmal 0.4% growth in 2QCY22, is likely to struggle to grow at 4% also in the current year.

Also read: RBI Monetary Policy: MPC to hike repo rate by 35-50 bps; global recession may risk growth forecast

The second issue that we have been fairly proactive in tackling before it went out of control, is inflation. India remains the best place in the world as far as inflation is concerned. Our CPI inflation at ~7% is just ~ 200bps away from the long-term average. The repo rate at 5.4% is just a hop, skip and jump away from making the real rates neutral. This is a far cry from the rest of the world, which continues to struggle. The proactive approach now puts RBI as one of the best central banks in the world.

The domestic capex cycle is showing signs of revival. Corporates have been cautious, and rightly so, but the green shoots now are visible. Balance sheets are strong, cash flow positions comfortable and capacity utilization higher than the longer average. This essentially means that soon enough we shall the private sector capex come back and will come back strong, thereby pushing the system credit growth even higher than the current trajectory. This improves the overall outlook for the economy quite a bit.

Also read: Gautam Adani slips to third place in world’s rich list, Mukesh Ambani out of top-10 after Monday’s D-St rout

Lastly, they say every dark cloud has a silver lining. The recession in USA and EU may be bad for the overall economy but helps India quite a bit. It is true that it impacts the BoP but there are ways to tackle that (Hint: Gold import curbs), however, the softening of the commodity prices help us quite a bit. The margin concerns are now a thing of the past and confidence that Nifty will be able to deliver strong double-digit growth is now fairly high.

So, the crux of the matter is India stands tall amidst ruins. In a volatile market, do not miss the opportunity. Invest every time the Nifty shows meaningful correction and you shall create wealth for yourself in the long term. However, remember to invest only in Good & Clean companies.

(Manish Jain is a Fund Manager at Coffee Can PMS, Ambit Asset Management. The views expressed in the article are of the author and do not reflect the official position or policy of FinancialExpress.com.)

ACC Q2 profit beats estimates

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ACC, an Adani Group cement company, has posted a consolidated net profit of Rs 388 crore for the second quarter ended September, buoyant on an improved demand for its premium products and operational efficiencies. In comparison, the company had posted a net loss of Rs 87 crore a year ago.

The company’s revenue rose 11.2% to Rs 4,435 crore from Rs 3,987 crore in Q2FY23. The cement manufacturer had posted a net profit of Rs 466 crore in the sequential quarter ended June, ACC said in a statement.

“This growth is attributed to the improved demand for our premium cement products up by 1.5 percentage points on a year-on-year basis at 32% of trade sales and net dealer addition of 534 during the quarter across all markets. In operational efficiencies, electrical energy consumption improved by 6.4 kilowatt-hour per metric tonne (kWh/t) at 73.9 kWh/t with clinker factor improvement from 57.2% to 56.6% coupled,” CEO Ajay Kapur said.

“Our commitment to enhancing logistics efficiencies has resulted in a road direct despatch increase from 52% to 58% and an increase in rail coefficient by 5 percentage points to 34%,” he added.

ACC’s clinker and cement sales volume rose by 17.3% y-o-y to 8.1 million tonne, while kiln fuel cost fell by 42%, driven by fuel mix optimisation and higher alternative fuel consumptions.

During the quarter, ACC’s The Waste Heat Recovery System (WHRS) at Kymore & Jamul (22.4 MW) became fully operational, while another 16.3 MW at Ametha is expected to be commissioned in Q3. The share of WHRS in total power consumption will increase to 9% by the end of FY24 against 2.9% in the last quarter, it said.

On the outlook, the firm said it expects the industry to witness a volumetric growth as the demand environment remains “robust” on the back of increased housing and infrastructure spend.

McDonald’s India franchisee Westlife Foodworld Q2 profit drops 29.1% to Rs 22.37 cr on higher costs, revenue up 7.4% YoY

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Westlife Foodworld Limited (WFL), formerly known as Westlife Development and the owner-operator of McDonald’s restaurants across west and south India, on Thursday announced its Q2 earnings with profit at Rs 22.37 crore. The Q2 profit dropped by 29.1 per cent on-year in comparison to Rs 31.54 crore during the corresponding quarter of last year. It posted revenue from operations at Rs 614.73 crore, up 7.4 per cent as against Rs 572.42 crore during the second of FY23. 

Westlife Foodworld’s operating EBITDA grew 7 per cent YoY in H1FY24. Despite the lower operating EBITDA margin on account of higher G&A costs, gross margins improved by 93 bps YoY in Q2, thanks to an improved mix and cost-saving initiatives, whereas input costs remained mostly in line with the company’s expectations.

Westlife Foodworld said that its on-premises as well as off-premises businesses grew by 7 per cent YoY, with the off-premise contribution remaining stable at 41 per cent. “The group continues to focus on digital transformation with self ordering kiosks and mobile apps, with digital sales growing by 30 per cent YoY and contributing 67 per cent to the top line,” it said. 

Despite ongoing market challenges, the company added, it delivered a 3 per cent Same Store Sales Growth (SSSG) in H1FY24, marking an 11 per cent YOY growth in revenue compared to H1FY23. Q2FY24 sales grew by 7 per cent YoY, demonstrating the company’s ability to sustain growth and profitability. SSSG in Q2 was 1 per cent YoY.

“Our second quarter results, amidst challenging market conditions, reflect consistently strong execution of our long-term strategic playbook aligned with our Vision 2027. The resilient Q2 FY24 performance and sales growth affirm that Westlife Foodworld’s strategy of omnichannel, menu innovations, and prudent network expansion is working. While macroeconomic challenges persist, we continue to invest in our new stores and our other growth drivers to create value for all our stakeholders,” said Amit Jatia, Chairperson, Westlife Foodworld.

In terms of its network presence, as of September 2023, Westlife Foodworld is present in 370 restaurants across 59 cities. The company added 9 restaurants during Q2FY24 and is on track to add 40-45 stores in FY24. It aims to reach 580-630 restaurants by 2027.

Westlife Foodworld has a total of 71 drive-thrus and the company added 2 during the second quarter of FY24. It has 327 McCafés and Q2 saw an addition of 11 more by the company. Westlife also has a total of 237 EOTF stores and it added 13 more in Q2FY24. “This expansion underscores Westlife Foodworld’s commitment to catering to a broad market segment across various dayparts. It also fortifies its unique business model of combining quality food offerings with innovative dining experiences, thereby establishing a strong foothold across the geographies of West and South India,” the company said in a statement. 

Sensex, Nifty fall over 1 pc on selling in banking, auto shares

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Key stock indices Sensex and Nifty declined over 1 per cent at close on Monday due to heavy selling in banking, auto and FMCG shares amid weak global market trends and continued foreign fund outflows.

Reversing its previous session’s gains, benchmark BSE Sensex tumbled 638.11 points or 1.11 per cent to settle at 56,788.81. During the day, it tanked 743.52 points or 1.29 per cent to 56,683.40.

Also read: Pixel 7, Pixel 7 Pro design renders, specifications leaked online ahead of Google event on October 6

Among Sensex stocks, Maruti fell the most by 3.16 per cent, Hindustan Unilever by 2.77 per cent, IndusInd Bank by 2.55 per cent, ITC by 2.32 per cent, Bajaj Finance by 2.26 per cent, State Bank of India by 2.15 per cent and Kotak Mahindra Bank by 2.03 per cent.

Dr Reddy’s, NTPC, Bharti Airtel and Wipro were the winners.

Sensex had surged by 016.96 points or 1.80 per cent to settle at 57,426.92 on Friday. The Nifty climbed 276.25 points or 1.64 per cent to end at 17,094.35.

“Markets started the week on a feeble note and lost over a per cent, tracking weak global cues,” Ajit Mishra, VP – Research, Religare Broking Ltd, said.

In the broader market, the BSE midcap gauge declined 1.24 per cent and smallcap index fell by 0.54 per cent.

Among the BSE sectoral indices, power fell by 3.24 per cent, utilities by 3.14 per cent, auto (2.11 per cent), FMCG (2.05 per cent), commodities (2.01 per cent), consumer discretionary (1.26 per cent) and realty (1.24 per cent).

Healthcare and telecommunication ended in the green.

Global markets are expected to stay under pressure due to the confluence of an unfavourable economic outlook and investor risk aversion, Vinod Nair, Head of Research at Geojit Financial Services, said.

Also read: Plans to modernise Sevagram Industrial Area within 2.5 years: MSME Minister Narayan Rane

“Global markets were in pain as economic data forecast to shed lower as indicated by high-frequency indicators in European regions like UK PMI is consequently down below 50 showing contraction in economy.

“As demand slowed, India’s manufacturing PMI declined slightly to 55.1 in September. As a result, all the key sectors were pressured by selling, except pharma & Oil stocks,” Nair added.

Elsewhere in Asia, markets in Hong Kong settled lower, while Tokyo ended higher.

Stock exchanges in Europe were trading lower in mid-session deals after oil prices rose by more than USD 3 per barrel amid dire warnings over energy shortages in Europe. The US markets ended in negative territory on Friday.

Meanwhile, the international oil benchmark Brent crude futures jumped 3.90 per cent to USD 88.46 per barrel.

Foreign institutional investors offloaded shares worth Rs 1,565.31 crore on Friday, according to data available with BSE. Foreign investors turned sellers in September, pulling out Rs 7,600 crore from Indian equity markets.

US stocks: Wall Street posts fourth straight day of gains ahead of CPI report

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Wall Street extended its winning streak on Monday, rallying to a sharply higher close as investors awaited crucial inflation data that could provide clues about the duration and severity of the Federal Reserve’s tightening policy. Energy and technology shares helped the three major U.S. stock indexes touch two-week highs and notch their fourth straight session of gains, in which growth stocks were slightly favored over value.

The Labor Department’s consumer price index (CPI), expected before Tuesday’s opening bell, is this week’s main event, and will be scrutinized for any signs regarding the number and size of future interest rate hikes from the Fed.”CPI is expected to see a little bit of a decrease,” said Robert Pavlik, senior portfolio manager at Dakota Wealth in Fairfield, Connecticut. “The market is hoping that news translates into smaller rate hikes after the Sept FOMC meeting.” “Because of that, you’re seeing a risk-on type of mentality today,” Pavlik added.

On Thursday, Fed Chair Jerome Powell affirmed the central bank remains “strongly committed” to tackling decades-high inflation, and that it would “keep at it until the job is done.”Economists polled by Reuters expect monthly CPI to have contracted 0.1% in August from July, edging down to 8.1% year-on-year, mainly due to the recent cool-down of commodity prices.

Financial markets have currently priced in a 92% probability that the Federal Open Markets Committee (FOMC) will implement its third straight 75-basis-point interest rate hike at the conclusion of next week’s policy meeting, according to CME’s FedWatch tool. “The market has now fully priced in 75 basis points for September,” Pavlik said. “The market is hoping the next one is 50 basis points and that we’ll see a slight decrease in rate hikes after that, and Wall Street can live with that.”

Also read| Wall Street cautious ahead of US inflation data

The Dow Jones Industrial Average rose 229.63 points, or 0.71%, to 32,381.34, the S&P 500 gained 43.05 points, or 1.06%, to 4,110.41 and the Nasdaq Composite added 154.10 points, or 1.27%, to 12,266.41. All 11 major sectors of the S&P 500 closed green. Energy companies, boosted by rising crude prices, enjoyed the biggest percentage gain. Economically sensitive transports outperformed the broader market, while market-leading megacaps provided the most lift.

A 3.9% jump in Apple Inc shares gave the S&P 500 and the Nasdaq their biggest boost, days after the gadget maker unveiled updates to its iPhone and Apple Watch. Drugmaker Bristol-Myers Squibb rose 3.1% following the Food and Drug Administration’s approval of its psoriasis drug late on Friday. Rival Amgen Inc, maker of psoriasis drug Otezla, slid 4.1%.

Twitter Inc ended the session down 1.8% amid its legal wrangling against Tesla Inc chief Elon Musk for scrapping a deal to acquire the social media platform. Car selling platform Carvana Co hopped 15.5% higher following Piper Sandler’s upgrade of the stock to “overweight. “Advancing issues outnumbered declining ones on the NYSE by a 3.37-to-1 ratio; on Nasdaq, a 1.78-to-1 ratio favored advancers. The S&P 500 posted 11 new 52-week highs and no new lows; the Nasdaq Composite recorded 47 new highs and 59 new lows. Volume on U.S. exchanges was 9.63 billion shares, compared with the 10.22 billion average over the last 20 trading days.

FPIs infuse Rs 12,000 cr in Indian equities in Sep on hopes of slow rate hikes 

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Foreign investors pumped Rs 12,000 crore into the Indian equity market so far this month on hopes that global central banks, particularly the US Fed, may go slow on rate hikes as inflation starts to cool off. This comes following a net investment of staggering Rs 51,200 crore in August and nearly Rs 5,000 crore in July, data with depositories showed.

FPIs turned net buyers in July after nine straight months of massive net outflows, which started in October last year. Between October 2021 till June 2022, they sold a massive Rs 2.46 lakh crore in the Indian equity market.

According to data with depositories, FPIs (foreign portfolio investors) pumped a net Rs 12,084 crore into Indian equities during September 1-16. They were net buyers on hopes of continued growth momentum, even as global and domestic data prints were adverse with elevated inflation reported across major economies, Chouhan said.

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“Foreign investors continued to invest into Indian equities on expectation that global central banks, particularly US Fed, may go slow on rate hikes as the inflation starts to cool off,” Himanshu Srivastava, Associate Director – Manager Research, Morningstar India, said.

Additionally, given Indian equities would be an attractive investment destination as inflation cools off and the economy embarks on growth trajectory, FPIs would have preferred to stay invested than losing out on that opportunity, he added. Also, Indian equities went through a correction phase making them relatively attractive on valuations. This provided them a good buying opportunity to hand-pick high quality companies.

The sustained FPI buying that started in July and gathered momentum in August and continued in September too, supported the recent rally in the Indian market.

However, they turned sellers in last few days of the current month on fears of global economic slowdown. FPIs are likely to wait and watch before resuming their buying in India, VK Vijayakumar, Chief Investment Strategist at Geojit Financial Services, said.

Morningstar India’s Srivastava said the recent CPI data in the US disrupted the trend of cooling inflation, thereby dashing hopes that the US Fed could take breather after September and ease up on its interest rate hikes. The August US inflation edged 0.1 per cent higher from the preceding month to 8.3 per cent. Compared to the year-ago period, it eased from 8.5 per cent.

Apart from equities, FPIs infused a net Rs 1,777 crore in the debt market during the month under review. In addition to India, Indonesia and the Philippines witnessed inflows, while Taiwan, South Korea and Thailand witnessed withdrawals during the period under review.

Petrol, Diesel Price Today, 15 Sep 2022: Fuel cost static; check rates in Delhi, Noida, Mumbai, other cities

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Petrol and Diesel Rate Today in Delhi, Bangalore, Chennai, Mumbai, Lucknow: The price of petrol and diesel has been kept steady on Thursday, 15 September 2022, keeping costs steady for more than three months now. Petrol and diesel in Delhi is priced at Rs 96.72 and Rs 89.62 a litre, respectively. In Mumbai, petrol is retailing at Rs 106.31 per litre and diesel at Rs 94.27 per litre. The last country-wide change in price came on 21 May 2022, when Finance Minister Nirmala Sitharaman announced a cut in excise duty on petrol by Rs 8 per litre, and Rs 6 per litre on diesel. Since then, Maharashtra is the only state to have cut rates. The Maharashtra government had announced a cut in value-added tax (VAT) on petrol by Rs 5 a litre and by Rs 3 a litre for diesel in July.

Also read: Bank Nifty must hold above 41250 to hit new lifetime high; buy ICICI Bank, SBI stocks on dips to pocket gains

Also read: Rupee likely to depreciate on strong dollar, elevated crude prices; USDINR pair to trade in this range

Petrol, diesel prices in Chennai, Kolkata, Bengaluru, Lucknow, Noida, Gurugram

Mumbai: Petrol price: Rs 106.31 per litre, Diesel price: 94.27 per litre

Delhi: Petrol price: Rs 96.72 per litre, Diesel price: Rs 89.62 per litre

Chennai: Petrol price: Rs 102.63 per litre, Diesel price: Rs 94.24 per litre

Kolkata: Petrol price: Rs 106.03 per litre, Diesel price: Rs 92.76 per litre

Bengaluru: Petrol: Rs 101.94 per litre, Diesel: Rs 87.89 per litre

Lucknow: Petrol: Rs 96.57 per litre, Diesel: Rs 89.76 per litre

Noida: Petrol: Rs 96.79 per litre, Diesel: Rs 89.96 per litre

Gurugram: Petrol: Rs 97.18 per litre, Diesel: Rs 90.05 per litre

Chandigarh: Petrol: Rs 96.20 per litre, Diesel: Rs 84.26 per litre

Public sector OMCs including Bharat Petroleum Corporation Ltd (BPCL), Indian Oil Corporation Ltd (IOCL) and Hindustan Petroleum Corporation Ltd (HPCL) revise the fuel prices daily in line with international benchmark prices and foreign exchange rates. Any changes in petrol and diesel prices are implemented from 6 am every day. Retail petrol and diesel prices differ from state to state because of local taxes like VAT or freight charges.

Mcap of BSE-listed firms at all-time high of Rs 282.66 lakh cr

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The market capitalisation of BSE-listed firms reached an all-time high of Rs 282.66 lakh crore on Thursday, helped by a rebound in equities.

The 30-share BSE Sensex climbed 659.31 points or 1.12 per cent to settle at 59,688.22 after falling in the previous two trading days.

Also Read: Sensex ends at nearly 1-month high; Nifty may hit 18100, momentum indicator enters into bullish crossover

“A solid rebound was the order of the day at Dalal Street as stocks simply zoomed in today’s session. The credit for the rally can be given to overnight positive Wall Street cues and also to the fact that crude oil prices continued to tumble. Crude oil prices are trading at their lowest levels after February,” Prashanth Tapse – Research Analyst, Senior VP (Research), Mehta Equities Ltd.

Tech Mahindra, Axis Bank, ICICI Bank, Mahindra & Mahindra, Bharti Airtel, State Bank of India, UltraTech Cement, Bajaj Finserv, IndusInd Bank and Asian Paints emerged as the biggest gainers among Sensex stocks.

Tata Steel, Titan, NTPC, Nestle and Power Grid were the laggards.

In the broader market, the BSE smallcap gauge climbed 0.60 per cent and midcap index ended higher by 0.29 per cent.

A total of 2,062 stocks advanced, while 1,402 declined and 125 remained unchanged.

In Asia, markets in Seoul and Tokyo ended in the green, while Shanghai and Hong Kong settled lower.

Equities in Europe were trading on a mixed note during the mid-session deals. The US markets had ended significantly higher on Wednesday.

Meanwhile, the international oil benchmark Brent crude dipped 0.49 per cent to USD 87.57 per barrel.

BSE, NSE, MSE to provide market data of listed securities as early as possible

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Leading bourses — BSE, National Stock Exchange (NSE) and Metropolitan Stock Exchange (MSE) — on Friday decided to provide daily price related information of the listed securities on their websites as early as possible after the markets close.

Also Read| Sensex, Nifty erase all yearly gains; Nifty support at 17166, investors poorer by Rs 5 lakh crore

“In view of the larger interest of investors and various market participants who use the daily price related information like open price, day’s high, day’s low, closing price etc. of securities for their downstream processes, the exchanges have jointly decided to provide such information on their website as early as possible after the close of markets,” BSE, NSE and MSE said in a joint statement.

Also Read| Nifty turns negative for 2022, Sensex falls 1.5%, Bank Nifty tumbles 3%; what is dragging markets today?

The three exchanges provide platform for trading in capital market, Futures & Options (F&O), interest rate derivatives, currency derivatives and exchange traded funds (ETFs).