The sensex fell 1.6% due to weak December quarter results, indicating an economic slowdown. Major sectors ended in the red, with banks and consumer sectors leading declines. Disappointing corporate earnings, global uncertainties, and a weak rupee contributed to investor concerns, while long-term growth optimism remains positive.
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India is set to welcome over 120 new mid-market global capability centres (GCCs) by 2026, driven by medium-sized companies leveraging the country’s digital expertise. Over 800 mid-market GCCs currently employ 220,000 people, and the U.S. and Europe dominate the space. Emerging cities are attracting new GCCs, which are vital for sustainable growth and technological advancement.
Indian IT firms generated $20 billion in free cash flows last year with over 75% returned to shareholders. Experts highlight the need for a reset as AI disrupts traditional business models. They suggest reinvesting in innovation and strategic investments to leverage future opportunities rather than focusing only on short-term shareholder returns.
The Reserve Bank of India (RBI) fined Citibank NA, JM Financial, and Asirvad Micro Finance for regulatory non-compliance. Citibank was penalized Rs 39 lakh for credit data breaches, JM Financial fined Rs 1.5 lakh for non-disclosure of interest rate rationale, and Asirvad Micro Finance fined Rs 6.2 lakh for failing to report borrower income and other omissions.
Indian companies shattered fundraising records in 2024, raising over ₹1.2 lakh crore through Qualified Institutional Placements (QIPs) by November. This surge, driven by a robust stock market and high valuations, doubled the previous year's figures. Giants like Vedanta and Zomato led the charge, each raising ₹8,500 crore.
RBI Governor Sanjay Malhotra faces a significant test as the rupee is poised to breach 86 due to a stronger dollar. This complicates GDP growth efforts expected to slow to 6.4% in FY25. Forex intervention has tightened liquidity, impacting interest rates and contributing to capital outflows.
The Sensex surged 843 points to a two-month high of 82,133, driven by strong foreign fund inflows and buying in FMCG, IT, and banking stocks. This followed a volatile session with a 2,100-point intraday swing, influenced by global market weakness and uncertainty about China's economic recovery. Market sentiment remains cautious due to rising US Treasury yields and a weaker rupee.
India's foreign exchange reserves dropped by $8.478 billion to $644.391 billion for the week ending December 20, marking a continued decline. The reduction is mainly due to the revaluation and RBI's efforts to stabilize rupee fluctuations. Foreign currency assets and gold reserves saw significant reductions, contributing to the overall decline in reserves.
Emami's MD, Harsha Vardhan Agarwal, new Ficci president, states that consumption slowdown, impacted by inflation, will take a few quarters to normalize. He suggests controlling inflation and boosting government spending to revive demand, noting a mixed bag for FMCG with rural uptick and urban slowdown.
Departments such as telecom, defence, railways, and highways have experienced lower capital expenditure with telecom spending just 6% of its annual allocation. Total government capex during April-Nov fell to 49% from 59% last year. The slow spending is attributed to milestones tied to funding and recent elections impacting the first quarter.
Nissan and Honda are exploring a potential collaboration to enhance competitiveness. Indian and global automakers and two-wheeler manufacturers are increasingly forming alliances to improve efficiencies, reduce costs, and gain access to advanced technologies.