Daily Market Highlights MAY 25

Untitled 5 Daily Market Highlights MAY 25

Previous Day Market

Sensex closed at 50,651.90 up by 111.42 points

Nifty closed at 15,197.70 up by 22.40 points

In FY21, India attracted record FDI inflow of $81.72 billion; nearly 10% higher on yoy basis. Like in the previous year, computer IT and hardware attracted nearly 44% of the FDI inflow during the year while infrastructure followed well behind at 13%. Interestingly, it was Saudi Arabia that emerged as one of the big contributors to FDI in FY21 at $2.82 billion. This was largely on the back of the big investments that the sovereign funds of Saudi Arabia made in Jio Platforms and Reliance Retail. US and UK FDI were up too.

Oxford Economics lowered India’s growth projections for Fiscal Year 2021-22 by 110 basis points to 9.1%. They have attributed factors like the resurgence of the virus, extended lockdowns and macro debt concerns as the reasons for this downgrade of growth estimates. India is likely to reach the vaccine threshold only in end of August, so lockdowns may have to continue for longer. Indian economy has been betting on a rapid return to high growth so that the lag effect of the last two years can be recovered fully.

Bharat Biotech submitted documents to the WHO for emergency use listing or EUL for Covaxin, the anti-COVID vaccination produced indigenously by Bharat Biotech. Bharat Biotech expects to submit all the documents by June to enable EUL. Interestingly, Covaxin has got regulatory approval from 11 nations and there have been EOIs for transfer of technology too. It also plans to conduct small-scale phase-III clinical trials of Covaxin in the US for FDA approval. There is a need for war footing progress on vaccines.

A few days after Moderna refused to directly dispatch vaccines to state governments, even Pfizer has refused to entertain requests directly from the state governments. Pfizer refused to send vaccines directly to Punjab state as a matter of policy of only dealing with Federal governments. Pfizer already has a very robust supply chain in the US and in Europe. In fact, Pfizer and BioNTech propose to deliver over 2.5 billion vaccine doses in 2021. Punjab has also approached J&J and RDIF for direct supply and replies are awaited.

If you are wondering why commodity stocks and prices are correcting, it is because China is stepping up its fight against rising commodities prices. It has already threatened speculators with severe punishment for indulging in excessive speculation. This has led to prices of steel, copper and iron ore coming under pressure as China remains the world’s largest consumer of metals by a margin. However, there is only so much control that China can exercise on global commodity prices, though they control the demand levers.

A UK court has asked Goshawk, the Irish aircraft lessor, and SpiceJet to mediate the payment despite recognising that SpiceJet had as defaulted on lease payments. Goshawk sued SpiceJet for $16.2 million. The UK court refused to take any action against SpiceJet on the premise that forcing SpiceJet to pay at this stage could result insolvency. Most aircraft lessors insert the “hell or high water” clause in aircraft lease contracts and this judgement will surely impair that clause. Hell, or high water overrides force majeure.

South based kitchen appliance manufacturer, Butterfly Gandhimathi, has rallied 45% in the last few days since its results to touch a high of Rs.923 on the BSE. In the Mar-21 quarter, the company had turned around to a net profit of Rs.9.9 crore from a net loss last year. Top line revenues had also grown 86%. The kitchen appliances segment had seen good traction on the back of accentuated preference for home food. The company has focused hard on improving its branded business debtors days, which halved yoy.

Natco Pharma surged 20% to scale Rs.1,189 after it received approval from the USFDA for the generic version of Celgene’s multiple myeloma drug, Revlimid capsules in US. The generic Lenalidomide capsule is administered to adults with multiple myeloma and myelodysplastic syndromes. The stock is up 30% in the last 3 days and has been one of the best performing pharma stocks in the last one year. Natco has started Phase-III clinical trials for efficacy and safety of Molnupiravir Capsules in mild COVID-19 patients.

                                   World Market Indices 

%name Daily Market Highlights MAY 25

 

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