The Nikkei lost 2.6% and the Shanghai Composite lost 0.2%. The Hang Seng fell 0.4%.
In US stock markets, Wall Street indices ended bullish on Wednesday after minutes of a US Federal Reserve meeting indicated the central bank may have to raise interest rates sooner than expected.
The Nasdaq posted its biggest one-day percentage drop since February. Minutes after the release, the tech heavy index sharply extended losses, which investors saw as more hawkish than feared.
The Dow Jones Industrial Average fell 1.1%, while the Nasdaq fell 3.3%.
After returning home, the Indian stock market opened in red today.
Taking cues from SGX Nifty and weak global sentiment, the benchmark indices opened sharply lower today and extended losses.
BSE Sensex is trading with a fall of 764 points. Meanwhile, NSE Nifty is trading with a fall of 215 points.
Maruti Suzuki is among the top gainers today. On the other hand, HDFC Bank and Tech Mahindra are among the biggest losers today.
The BSE Midcap index is down 0.7 per cent. BSE Smallcap Index is trading with a decline of 0.5%.
Barring telecom stocks, all sectoral indices are trading with the biggest selloff in IT sector, finance sector and banking sector stocks.
Radico Khaitan and Suntec Realty hit 52 week high today.
Shares of a dozen recently launched firms are in focus today as the mandatory one-month lock-in period for anchor investments ends tomorrow. Five of these 12 companies, including RateGain, Shriram Properties, Data Patterns, Supriya Lifesciences and CMS Info Systems, had allotted more than 10% of outstanding shares to anchor investors.
Rupee is trading at 74.46 against US Dollar.
Gold prices are trading lower by 0.5% 47,767 per 10 grams.
Gold fell today on a jump in US Treasury yields as minutes of a sharp meeting released by the Federal Reserve offset safe-haven demand for the precious metal.
Crude oil prices tumbled, falling from their highest level in more than a month as OPEC+ producers stuck to plans to boost production and US fuel stocks rose amid declining demand.
In news from the banking sector, HDFC Bank is one of the top buzzing stocks today.
HDFC bank sold out 21.9 billion distressed retail loans to asset reconstruction companies (ARCs) over the past three quarters with the aim of clearing their books.
As per reports, the retail pool mainly consisted of personal and vehicle loans.
The private lender is selling its retail loan portfolio in the last fortnight of every quarter. Phoenix ARC acquired two pools in the quarter ended June and December, while Edelweiss ARC acquired one pool in the quarter ended September.
In the December quarter, HDFC Bank had invited bids for the credit card portfolio of 500 m from ARC However, the auction failed to attract bidders as the reserve price of 23% was considered too high, although there were buyers at 10–13%.
HDFC Bank made sales in the June quarter 14.8 billion retail pool for consideration 7.8 billion, and it sold in December 2.6 billion for 1.4 billion Both trades were made with Phoenix ARC at 53-54 paise on Re 1.
Meanwhile, the bank sold a 4.5 billion retail portfolio for $1.8 billion, Edelweiss ARC at 39 paise on Re 1.
The retail loan portfolio sold to ARCs contained accounts that were classified as non-performing loans – overdue for more than 90 days – and accounts that were classified as Special Mention Accounts-2 – where Overdue is between 61 days and 90 days.
Reportedly, HDFC Bank may have sold retail NPAs to prevent a spike in non-performing numbers. The bank’s net non-performing loans for the quarter ended September 2021 was 47.6 billion, which is 0.4% of its net loan book.
HDFC Bank share price is currently trading with a decline of 2%.
Do note that, HDFC Bank is one that has always been in tune with the changing times.
HDFC Bank wanted to transform itself from a leader in physical banking to a leader in online banking. Since then, HDFC Bank has consistently focused on going digital.
In 2004, only 10% of customer transactions were initiated via the Internet and mobile. This number has increased to 92% in 2019.
This is a great example of a company that has leveraged its scale and embraced disruption rather than fear.
These are the traits that one should look for in choosing a stock. They not only face the disruption but also reap the benefits in the long run.
Moving on to the news from the automobile sector, Hero Electric, the market leader Electric Two-Wheeler Segmenthas approached the Delhi High Court seeking arbitration proceedings against Hero MotoCorp for the use of the ‘Hero’ trademark.
Naveen Munjal-led Hero Electric has claimed exclusive rights under a family agreement to prevent Hero MotoCorp from using the Hero brand name.
In its petition, the company has sought a ban on Hero MotoCorp from using the ‘Hero’ brand name for its upcoming electric vehicle (EV) to be launched in March.
While Hero Electric is headed by Naveen Munjal, Hero MotoCorp is headed by his uncle Pawan Munjal. Both the companies are market leaders in their respective segments.
Though Hero has been in electric EV business for 15 years, it has now been taken seriously to protect the brand image with the debut of Hero MotoCorp in the heating EV market.
Multiple media reports indicate that Hero MotoCorp has already registered the “Vida” brand name for use on electric scooters and bikes.
The sources also said that the 2010 family agreement does not impose any restriction on Hero MotoCorp from selling EVs nor bar it from using its trademark.
Hero MotoCorp, which also holds a 35% stake in EV startup Ather Energy, is planning to launch its first electric product in March. In addition, it has tied up with Taiwan-based Gogoro Inc. to bring the latter’s battery swapping platform to India.
Hero MotoCorp share price is currently trading with a decline of 0.9%.
This article is syndicated from Equitymaster.com
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