Sebi bans The Apex Global, its proprietor from markets for 4 years

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Markets regulator Sebi has barred The Apex Global and its proprietor Yadunath Singh Thakur from securities markets for four years and directed them to refund money collected from investors through unauthorised investment advisory services.

The regulator found that The Apex Global and Thakur were engaged in the business of providing investment advice to their clients and for consideration and thus, were acting as investment advisers. They were involved in such investment advisory services without obtaining regulatory approval from it, which is in violation of Investment Advisers (IA) norms, the Securities and Exchange Board of India (Sebi) said in its order on Wednesday. Through such services, they had received a total amount of Rs 1.23 crore from June 2013 to December 2019 through unregistered investment advisory activities, it added.

Accordingly, Sebi said, the “noticee shall within a period of three months refund the money received from any complainants/ investors, as fees or consideration or in any other form, in respect of their unregistered investment advisory activities”.

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The Apex Global and its proprietor Thakur are collectively referred to as the noticee. Also, they have been barred from accessing the securities market for 4 years or till the expiry of 4 years from the date of completion of refunds to investors, whichever is later. Meanwhile, in a separate order, Sebi has slapped a fine of Rs 2 lakh on two promoter entities of TCM Ltd for violating regulatory norms.

Rupee likely to depreciate on strong dollar, elevated crude prices; USDINR may trade in this range

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The Indian Rupee is expected to depreciate amid strong dollar, elevated crude prices. However, rise in risk appetite in equity markets, and foreign fund inflows is expected to provide some support to the local unit. USDINR spot price is expected to trade in a range of Rs 79.20 to Rs 80.30 in the next couple of sessions, according to analysts. In the previous session, rupee pared its initial gains and settled lower against the US dollar, weighed down by the strength of the greenback in the overseas market. A fall in crude oil prices and foreign fund inflows into equity markets, however, restricted the rupee losses. At the interbank forex market, the local unit opened at 79.70 against the greenback, and ended at 79.81, down 3 paise from its previous close.

Anindya Banerjee, VP, Currency Derivatives & Interest Rate Derivatives, Kotak Securities

Also Read: Will bulls manage to push Nifty past 18000 amid uncertainty? 5 things to know before market opening bell

Anuj Choudhary – Research Analyst, Sharekhan by BNP Paribas

“Indian rupee appreciated by 0.06% on Monday on positive domestic markets and a weak crude oil. However, strong US Dollar capped sharp gains. Domestic markets surged by 0.55% while US Dollar is trading 0.33% higher at 110.129 amid expectations of a hawkish US Federal Reserve. There are rising concerns of an aggressive rate hike in the upcoming FOMC meeting on September 21 on the back of hotter-than-expected inflation. There are rising odds of a big 100 bps rate hike from earlier expectations of a 75 bps rate hike.”

“Overall, we expect Rupee to trade with a negative tone as rate hike expectations are likely to keep the Dollar index strong which will be negative for Rupee. A large rate hike may put pressure on global equities which may lead to outflows by FIIs from emerging markets to the US. However, volatility may remain subdued on absence of any major economic data today. USDINR spot price is expected to trade in a range of Rs 79.20 to Rs 80.30 in next couple of sessions.”

Gaurang Somaiya, Forex & Bullion Analyst, Motilal Oswal Financial Services

“Rupee continued to consolidate in a narrow range as market participants remain cautious ahead of FOMC policy statement that is scheduled to release later this week. Expectation of a big rate hike pushed the benchmark 10-year Treasury yield to hit its highest in over a decade. Investors heard a hawkish message from Fed Chair Jerome Powell at the Jackson Hole banking symposium in August, but then remained in denial until it became clear inflation was stubbornly high. Most central banks that will be releasing their policy statements are expected to raise rates. Oil prices edged slightly higher in volatile trading as worries of tight supplies outweighed fears that global demand could slow due to a strong U.S. dollar and possible large increases to interest rates. Today, volatility could remain low as no major economic data is expected t be released from the US. We expect the USDINR(Spot) to trade sideways and quote in the range of 79.40 and 80.05.”

Dilip Parmar, Research Analyst, HDFC Securities

“Overnight weakness in the dollar index and stronger Asian currencies indicates a higher opening for the rupee at domestic bourses. The dollar erased its gain as equities rose and Treasury yields advanced amid US corporate bond supply, higher oil and positioning ahead of this week’s Fed decision. The dollar index was last quoted at 109.63 with a loss of one-third percentage. USDCNH is up 0.05% to 7.0166 after touching the high of 7.0257. The People’s Bank of China set the daily reference rate for the yuan at a level stronger than the average estimate in a Bloomberg survey with analysts and traders for the 19th day. Spot USDINR started the week on a positive note and closed at 79.77 with a gain of 3 paise. Trading volumes are subdued ahead of the events. The pair is expected to trade in the range of 79.90 to 79.40 in the near term.”

Also Read: Wall Street ends volatile session higher with focus firmly on US Fed rate hike decision

(The recommendations in this story are by the respective research analysts and brokerage firms. FinancialExpress.com does not bear any responsibility for their investment advice. Capital markets investments are subject to rules and regulations. Please consult your investment advisor before investing.)

“A certain amount of inflation is healthy given the redistribution impact”

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The Reserve Bank of India is clear that it wants to bring the consumer price index-based (CPI) inflation to 4% on a sustainable basis. While stating that the RBI seems confident of achieving this goal, Shamika Ravi, member, Prime Minister’s Economic Advisory Council, however, noted that some aspects of food inflation are not necessarily bad, given that these entail transfer to producers. In an interview with Priyansh Verma, the noted economist also highlighted the credibility loss being faced by global rating agencies, and opined that their parameters to assess the subject entities including sovereigns are biased in certain way.

Q. In a recent article, you had mentioned that socioeconomic surveys in India have tended to have a “rural bias”. Could you elaborate on this?

Q. What is the solution to this?

A. Since the census is a decadal exercise, the least one can do is to change the framework for conducting surveys. The framework should be based on the population projections, which are done every time the census is conducted. The sampling methodology for the surveys should look at the population projections, not the census. The projections have a lesser bias as they take into the account the past rate of urbanisation. The urban rate is not linear.

Q. There is also a lag in releasing key surveys, such as PLFS…

A. We need the (PLFS) reports to come out sooner. There is an issue of representation and the response rate as well. We have found that rich people don’t want to participate in surveys. This leads to bias. Data quality needs to improve. We have a lot of data, but need to improve their quality

Q. You recently criticised Moody’s Investor Service comment on Manipur. Do you feel that global rating agencies, such as Moody’s, Fitch, and S&P need to change the way they assess India’s macroeconomic fundamentals and government finances?

A. I believe the methodology that they use for assessment should not be so opaque. One needs to know how the ratings are making assessments of India’s macroeconomic fundamentals, the weightage they assign to different parameters such as, say, the Manipur incident. In many surveys that rating agencies put out, there is apparently a considerable amount of subjectivity. And that subjectivity is biased in a certain way. These agencies are going through a credibility crisis globally. If I were into capital markets, I would have looked at the rating that these agencies give and the actual flow of money.

Q. How do you see the impact of the ongoing Israel-Hamas on India’s economy?

A. Rising energy prices are obviously going to impact India. We are concerned with rising prices, whether it’s in account of the Russia-Ukraine war or the Israel-Gaza war. Anything that affects my growth rate quarter to quarter is a problem. The global economy is quite tumultuous. We are $2,300 per capita income economy. Our growth is non-negotiable. So far, we have been able to manage our growth.

Q. Can we attain 4% CPI inflation on durable basis by next year, as RBI projected, given there are risks to food inflation?

A. The RBI seems confident with its projections. It seems we’ll meet (the projections). But it may be noted that some aspects of food inflation are not bad. Particularly from the agriculture sector, this is a transfer to producers. High food inflation, with respect to some commodities, is not a cause of alarm the way it’s made out to be. A certain amount of inflation is healthy and there is a redistribution impact in the economy.

Q. RBI has often been not accurate on its inflation projections. They revised Q2 CPI projections thrice…

A. That tells you that we need to have better estimates. There is no substitute to data quality. An institution which has so much research capacity. RBI’s estimates have to get better with time.

Sebi cautions investors against funds raising by entities claiming to give portfolio management services

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Capital markets regulator Sebi on Monday cautioned investors against unauthorised money mobilisation by entities claiming to provide portfolio management services.Further, the regulator noted that these entities have been luring the public, with a promise of high returns, through pamphlets and social media platforms. It was observed that in such schemes, the entities have been mobilising money in relatively smaller amounts and promising assured returns, Sebi said in a statement.

The advisory comes after the Securities and Exchange Board of India (Sebi) noted that some entities are collecting money from the public claiming to provide portfolio management services. Some of the entities have names similar to that of Sebi-registered intermediaries, misleading the public, as though the fund raising is genuine and done by entities registered with the regulator. Sebi, therefore, cautioned “investors not to fall prey to such unauthorised money collection” and advised them to deal only with Sebi-registered intermediaries while investing in the securities market.

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Under the portfolio managers rule, a portfolio manager will have to be registered with Sebi and need to have an agreement with a client to undertake management or administration of a portfolio of securities or funds of the client. Further, a portfolio manager cannot accept funds or securities worth less than Rs 50 lakh from the client and cannot promise any guaranteed or assured return, either directly or indirectly as per the norms.

Nifty headed for 15,000 ahead of Budget 2021; charts show extreme bullishness in these sectors

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By Rajesh Palviya

The upcoming Union Budget will be an important event which will define the future trend in the market particularly because of the disruption caused by COVID19. The index has seen a strong rally in the month of January, registering a new all-time high of 14753 levels and closed at 14238. Since March 2020, the index surged almost 96% in the past ten months, making it one of the strongest gains in recent times. Since the past two consecutive weeks, the index continued to form a “Spinning Top” candlestick pattern, which signals a short term pause in the recent uptrend or trader’s indecision at the current juncture.

Sensex managed to touch a historical level of 50000 and witnessed profit booking from a higher level. Sensex long term chart is in bullish territory and indicates that till Sensex does not break below 47000-46500 level long term is going to remain bullish and Sensex can rally further towards 51000-52000 in the coming months.

Nifty is sustained and showing uptrend across all the time frames. Though our bias still remains positive, we observed some early signs of profit booking in this overstretched rally, hence the traders are advised to wait and watch for short term corrections to create fresh longs. As the Union Budget is near, we can expect volatility into various sectors /stocks which can trigger intense moves on either side. From current levels, the short to medium-term trend still remains intact and the bulls continue their bullish command into the markets towards 15000-15300 levels. On the downside, immediate support is placed around 14000 levels. However, any violation of this support zone on a closing basis may cause short term correction towards 13800 levels. Major support zone on the long term chart is placed at 13500-13200 levels.

Bank nifty witnessed resistance around its multiple supply zone of 32600-32800 levels since the last two weeks, indicating a cautious approach at current levels. Major trend still remains intact, the bullish medium-term trend still remains intact and the bulls continue their bullish command into the markets towards the 32800-35000 level, a pullback (if any) should be used as a buying opportunity. Going forward, major support is at 30000-28900 levels.Historical data suggests that the market may give a swing of 5-8% pre /post-budget; currently, the market trend is extremely bullish, so any corrective action should be used as a buying opportunity.

We expect the Auto, Pharma, FMCG, Capital goods and Power sectors to do well, as most of them have seen a good accumulation and bullish breakout ahead of budget.

(Rajesh Palviya is Head Technical & Derivatives Research, Axis Securities Ltd. Views expressed are the author’s own.)

US Stocks: Futures tick higher ahead of Powell’s speech

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U.S. stock index futures edged higher on Thursday after a broad market rebound in the previous session, with investors looking ahead to Federal Reserve Chair Jerome Powell’s speech for clues on monetary policy tightening plans.

Wall Street’s main indexes climbed the most in about a month on Wednesday as bond yields retreated after a recent surge that was driven by expectations of hawkish central bank policies.

Also Read: European markets face fresh reckoning threatening further losses

Hawkish remarks from Fed officials and recent data signaling strength in the U.S. economy have pushed money markets to bet on an 80% chance that the Fed will hike interest rates by another 75 basis points at this month’s meeting.

Goldman Sachs, too, raised its policy rate forecast to a 75 basis point hike this month from 50 basis points previously.

Powell may also shape expectations about what is to come when he speaks on Thursday, in what are likely to be his final public comments before this month’s policy meeting. He is scheduled to speak at 9:10 a.m. ET.

Concerns over a recession, stirred by aggressive central bank rate hikes and signs of economic slowdown in China and Europe, have dented the appetite for risk assets globally this year.

Data at 8:30 a.m. ET is expected to show 240,000 jobless claims were filed in the U.S. for the week ended September 3.

At 07:26 a.m. ET, Dow e-minis were up 35 points, or 0.11%, S&P 500 e-minis were up 2.75 points, or 0.07%, and Nasdaq 100 e-minis were up 3.5 points, or 0.03%.

GameStop Corp rose 7.1% in premarket trading after the video game retailer reported a smaller-than-expected quarterly loss.

American Eagle Outfitters Inc slumped 15.3% after the retailer missed second-quarter profit estimates and said it would pause quarterly dividend as it fortifies its finances against a hit from inflation.

MCX crude oil September futures support at 6500; US FOMC meet to guide crude oil movement

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The oil market is going through a rough patch as investors continue to grapple with inflation, demand fears and lockdown in China. US CPI which came higher than expected started cascading effect of selling pressure in all commodities including crude. While crude prices have taken a big hit, oil and gas stocks have fared even worse with energy equities experiencing nearly double the selling pressure compared to WTI crude. However recently the selling pressure has abated and WTI is steady at around $85. The market had taken in stride the outlook by IEA for almost zero growth in oil demand in the fourth quarter due to a weaker demand outlook for China however OPEC has forecasted 3.1 million bpd growth for the rest of the year. Sentiment also suffered from comments by the U.S. Department of Energy that it was unlikely to seek to refill the Strategic Petroleum Reserve until after fiscal 2023.

Also read: Gautam Adani becomes world’s 2nd richest person, beats France’s Bernard Arnault as group stocks rally

Also read: Gold prices to remain under pressure till US Fed; trend looks bearish, support seen at Rs 48800

In MCX, the price is taking resistance at a 20-day moving average since 30th August. It has failed to close or trade higher above the 20-day moving average so the immediate resistance is 7071. Above that, the next resistance is at 7470 where the 200-day moving average and swing high are. On the downside, 6650 and 6500 are the support which was a recent swing low. We don’t anticipate any major trend in crude owing to the news which is both positive and negative and thus counterbalancing the price at the centre. Any major or clear direction is expected after 21st September when the US Fed will give guidance about future rate hikes. Till then, the expected prices to trade in a broader range of 6500-7500.

(Bhavik Patel is a commodity and currency analyst at Tradebulls Securities. Views expressed are the author’s own. Please consult your financial advisor before investing.)

Continuing rural woes: No cogent evidence yet of a rural revival, the problem is more than cyclical

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The latest set of numbers put out by the leading fast moving consumer goods companies doesn’t inspire much confidence about the state of demand in rural India. Nor do many other proxy markers of the rural economy, like farm credit/exports or reservoir water levels, which indicate that the consumption demand in the rural sector hasn’t really recovered from the shock of the second wave of Covid. The rural woes had worsened even before the pandemic—the World Bank estimates that real rural wages in India have stagnated over the last decade. With elevated inflation, real wages in the hinterland are seen to have fallen through FY23 and much, if not all, of H1FY24. This sharply contrasts with the decent 7.5% growth reported for private consumption expenditure in the last fiscal year, and the Reserve Bank of India (RBI) survey that showed a four-year peak in overall consumer confidence in September 2023. Clearly, it is the urban areas that are holding the fort.

Though the crop damage caused by unseasonal (pre-monsoon) showers and uneven distribution of monsoon rainfall may have contributed to the longevity of the rural torpor, it has deeper underlying reasons. There is a shift in terms of trade away from the farmer and the average rural worker/trader, contrary to what policymakers claim. Wages are nearly half of rural household income, and well over a third is realisation from farming. There has been a lack of policy impetus to boost farm- and non-farm wages over several years. At the same time, the income support to farmers in the forms of minimum support prices (MSPs) and direct cash transfers (PM Kisan) have seemingly been offset by high inflation. The rise in farmers’ income has lagged that of other sections of the society, including large companies, and HNIs, undermining the rural purchasing power.

However, since the infirmity of the sector is not seasonal, it is necessary to address the issue with a well-planned policy response. To be sure, the stagnant rural sector reflects a larger structural shift in the economy, the brunt of which is borne by small businesses and (highly leveraged) households. The recent policy steps, like seeking to contain food inflation through easing of imports and curbs on exports, would only aggravate the problem. What’s needed is sustained effort to raise farm productivity and output, and improve price discovery of farm produce.

Cash-for-question row: Advocate Dehadrai, BJP MP Nishikant Dubey appear before Ethics Committee of Lok Sabha

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BJP leader Nishikant Dubey and advocate Jai Anant Dehadrai on Thursday appeared before the Ethics Committee of the Lok Sabha to record their statements in connection with the cash-for-query allegations against Trinamool Congress (TMC) member Mahua Moitra.

Dehadrai recorded his statements first and later Dubey appeared before the panel in the afternoon.

Advocate Jai Anant Dehadrai appears before the Ethics Committee of Parliament in ‘cash for query’ charge against TMC MP Mahua Moitra”I have told the truth before the Committee. All members of the committee enquired from me cordially. I answered to all that was asked from me.” pic.twitter.com/8lOzWo29kH

— ANI (@ANI) October 26, 2023

Dubey told reporters that he would reply to whatever questions the committee would ask him. “Documents don’t lie,” Dubey said when pointed out that Moitra had refuted all the allegations levelled against her.

In his complaint to Speaker Om Birla, BJP member Nishikant Dubey has cited documents shared by Dehadrai to back his cash-for-query allegations against the TMC MP. Birla had referred the matter to the committee headed by BJP member Vinod Kumar Sonkar.

Sonkar, who is the Chairman of Parliament Ethics Committee, told reporters on Thursday, “The two people who were summoned today – the lawyer and Nishikant Dubey – were heard attentively. After that, it was decided that Mahua Moitra would be called on 31st October. She will come and present her part. The committee has also decided that IT Ministry and MHA will be sent letters to make her details available.”

In the letter to Birla dated October 15, Dubey said the advocate, close to Moitra before they fell out, has shared “irrefutable evidence of bribes exchanged” between her and businessman Darshan Hiranandani, CEO of Hiranandani Group, to target the Adani Group and Prime Minister Narendra Modi.

The fiery TMC member dismissed the charges as a “jilted ex’s lies”, a reference to Dehadrai, and accused the Adani Group of being behind them to target her as she has been relentless in raising questions on the conglomerate’s practices and transactions.

In his letter to the speaker, Dubey said 50 of 61 questions she asked in Lok Sabha till recently were focused on the Adani Group.

In a signed affidavit, Hiranandani who allegedly paid her to raise questions in Parliament, said the TMC leader targeted Gautam Adani to “malign and embarrass” Modi whose impeccable reputation gave the opposition no opportunity to attack him.

(With inputs from PTI)

After Air India deal, Rolls Royce open to MRO facility in India

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As Air India prepares to induct its first wide-body plane, to be powered by Rolls-Royce engines, the British company would be open to considering an MRO (maintenance, repair and overhaul) centreinthecountry.

Speaking to FE, Kishore Jayaraman, president – India and South Asia, Rolls-Royce India, said, the company was open to the idea of MRO, but added it was a question of volume and scale. “These are very expensive propositions and it is not like you put up an MRO in every country,” he said.

In February, Rolls-Royce announced an order from Air India for 68 Trent XWB-97 engines, plus options for 20 more, powering the Airbus A350-1000. The Tata-controlled airline also ordered 12 Trent XWB-84 engines, the sole engine option for the Airbus A350-900.

“The 100-engine order is sizable. It is just the beginning. We believe the India wide-body market has a lot of headroom to grow,” Jayaraman said. This is the first time that an Indian airline has ordered the Trent XWB and the deal will make Air India the largest operator of the Trent XWB-97 in the world. Air India has placed orders for 34 A350-1000 and 6 A350-900 wide-body jets with Airbus. This will be the first time that an A350 commercial jet will be operated by an Indian airline.

“We are working closely with Air India to fully support the arrival of their new A350-900 aircraft. We will of course support the airline on ground in Delhi, providing engine monitoring support,” Jayaraman said.

While Airbus was earlier tipped to deliver six A350s to Air India by December, only the first one is set to join the carrier’s fleet by then, while the rest will follow in early 2024.

“Engines need to undergo rigorous maintenance procedures. As engine makers, we have to have a very solid relationship with Air India as we go forward,” Jayaraman said.

Typically, an aircraft engine needs to have maintenance over its lifecycle, which is 20 years. Rolls-Royce’s Bengaluru engineering centre played a vital role in designing the XWB engines. Rolls Royce has 2,500 engineers in India which is a five-fold growth in 10 years. It works on civil and defence aerospaceprojects.