Moneycontrol Pro Panorama | A mixed picture on inflation signals caution

#Economy, #inflation, #MC Pro Panorama, #Moneycontrol Pro Panorama, #Newsletter, #opinion, Retail inflation, brisk pace, index grew, reach pre-pandemic, Economic Recovery Tracker, stellar debut, listed, component maker, Know the debt-ridden Indian farmer, Wipro, GAIL, PI Industries

Dear Reader,

The Panorama newsletter is sent to Moneycontrol Pro subscribers on market days. It offers easy access to stories published on Moneycontrol Pro and gives a little extra by setting out a context or an event or trend that investors should keep track of.

Two sets of data released by the government, today and yesterday, paint a mixed picture on the inflation front. Retail inflation captured by the consumer price index (CPI) eased in August. Prices increased 5.3 percent in August, slower than 5.59 percent reported in the earlier month, thanks to a moderation in vegetable prices and food inflation. The reading is in line with the Reserve Bank of India’s medium-term inflation target of 2-6 percent. With monsoon rains reviving and kharif crop sowing at normal levels, indications are that food prices may remain tepid.

Even so, there is no widespread cheer. Non-food prices continue to rise at a brisk pace. The wholesale price index grew by 11.39 percent in August, faster than 11.16 percent in July. The prices are driven by fuel and manufactured products. Outlook for non-food prices remains a concern. Crude oil, whose derivatives power several industries, perked up on concerns of tight supplies in the US.

The Organization of the Petroleum Exporting Countries (OPEC) warned that the Delta variant may pose a risk to oil demand in the near term (October-December 2021). But the oil cartel sees a rebound thereafter. With economies reopening and travel resuming the OPEC expects oil demand to rise at a faster pace next year and reach pre-pandemic levels. “In 2022, oil demand is expected to robustly grow by around 4.2 mb/d, some 0.9 mb/d higher compared to last month’s assessment,” OPEC said in its latest monthly oil report. Mb/d is million barrels per day. This can keep fuel prices elevated.

As such, core inflation, which excludes the volatile food and energy items, remains sticky. Core inflation eased a bit in August. However, it remained range bound at 5.5-6.5 percent this year, indicating cost pressures. “Core inflationary headwinds remain rife, especially with higher input costs and reopening pressures,” warns Nomura research.

On the positive side, the economy is making good progress on the recovery front. The Nomura India Business Resumption Index rose in the week ending September 12 from the prior period. Our Economic Recovery Tracker update also pointed to weekly indicators benefiting from the onset of festival season demand, except for a few indicators. The main risk to be watched out for is a third wave of the pandemic.

Specialty chemicals producer Ami Organics, whose IPO received strong investor response, made a stellar debut on the stock exchanges. The stock listed at a 48 percent premium against its IPO price. While Vijaya Diagnostic Centre also listed at a premium to its issue price, the public issue of auto component maker Sansera Engineering opens today.

Our research team has analysed the Sansera Engineering IPO and also the implications of the boardroom coup at Zee Entertainment (links below). Do read.

Investing insights from our research team:

What else are we reading today?

What HUL’s ‘Winning in the Decade’ means for investors

Know the debt-ridden Indian farmer

Global house prices rise at fastest pace since 2005, report says (Republished from the FT)

Picks from our technical analysts: WiproGAIL and PI Industries (These are published every trading day before markets open and can be read on the app)

R Sree Ram

Moneycontrol Pro

Internet Explorer Channel Network
News Related


Covid-19 stimulus will continue, says Finance Minister Nirmala Sitharaman

Finance Minister Nirmala Sitharaman Finance Minister Nirmala Sitharaman said that India is in no hurry to withdraw the COVID-19 induced stimulus and emphasised that it will continue to build support ... Read more »

PI Industries Q2 PAT seen up 7.3% YoY to Rs 233.5 cr: ICICI Direct

PI Industries Ltd. | The stock has fallen -6 percent to Rs 2201.85 as on January 18 from Rs  2330.60 as on January 11. ICICI Direct has come out with ... Read more »

Wipro turnaround work in progress; valuations leave little on the table: Analysts

NEW DELHI: Wipro ‘s September quarter earnings sent its shares soaring, but analysts’ price targets largely suggest muted outlook for the stock. “Demand tailwind is already baked into valuations,” they ... Read more »

Coal surges to another record in China as cold wave adds to energy crisis

Coal price hikes are likely to be seen approaching the winter heating season, and likely to continue until the fourth quarter. SINGAPORE (BLOOMBERG) – Coal futures in China surged to ... Read more »

Dollar falls to 71.25 rubles

Euro grows to 82.76 rubles Read more »

Taher Badshah of Invesco on pockets in mid and small-caps where valuation comfort exists

Stock markets rallied massively in the last one-and-a-half years. Taher Badshah, chief investment officer of Invesco Mutual Fund, who is known for his contrarian style, decodes how market valuations are ... Read more »

India's economy is going great. Can the recovery sustain?

Representational image. On October 12, the International Monetary Fund (IMF) in its World Economic Outlook, maintained its forecast for India’s growth for FY22 and FY23 at 9.5 percent and 8.5 ... Read more »

Mexico to begin packaging Sputnik V vaccine in second half of November - statement

The Mexican regulator issued a permit for the emergency use of Sputnik V in the country to protect residents from the coronavirus infection in early February Read more »

Residents' FX deposits jump in Sept. amid brisk exports

SEOUL, Oct. 19 (Yonhap) — Foreign currency deposits at banks in South Korea rose sharply in September from a month earlier as exporters increased dollar holdings, central bank data showed ... Read more »

China's property sector contracts for first time since pandemic

Output in the real-estate industry shrank 1.6 per cent from a year ago. BEIJING (BLOOMBERG) – China’s property and construction industries contracted in the third quarter for the first time ... Read more »

RBI says longer policy support is needed for sustained economic recovery

Reserve Bank of India (File image) The Reserve Bank of India said that policy support is needed for longer for a sustained recovery in Asia’s third largest economy from a ... Read more »

S. Korean shipbuilders surpass annual targets on brisk new orders

By Nam Kwang-sik SEOUL, Oct. 19 (Yonhap) — South Korea’s major shipbuilders have outpaced their annual order targets backed by brisk global new orders, company officials said Tuesday. According to ... Read more »

Supply-crunch inflation gives central banks an unfixable problem

Traders are betting the Bank of England will raise its key rate to 0.5 per cent by the end of this year. HONG KONG (BLOOMBERG) – The global economy’s supply ... Read more »

Air Seoul to resume flights to Guam in nearly 2 years

SEOUL, Oct. 19 (Yonhap) — Air Seoul Co., a South Korean low-cost carrier, said Tuesday it will resume flights to Guam in December as the country prepares to shift to ... Read more »

Xi Jinping dials back China's economic overhaul as masses feel pain

BEIJING (BLOOMBERG) – Chinese President Xi Jinping took a big gamble shaking up key industries ahead of a political gathering that could decide whether he rules the country indefinitely. Now ... Read more »

Korea faces possible 3 percent inflation

Deputy Prime Minister and Finance Minister Hong Nam-ki. Korea Times file By Lee Kyung-min Korea is expected to register inflation of over 3 percent this year, driven by soaring raw ... Read more »

Russia, US think cyber norms will decrease threats to peace, security

Russia and the US prepared the UN General Assembly draft resolution on cybersecurity, inviting all countries to join the rules of behavior in cyberspace listed in the reports of the open working group and the group of governmental experts Read more »

Singapore firms worry most about rising costs; 40% see losses this year: SCCCI survey

Sentiment on financial performance remains depressed, albeit improved from last year. SINGAPORE (THE BUSINESS TIMES) – Some 57.3 per cent of Singapore businesses surveyed saw their costs rise this year, ... Read more »

China's economic growth slumps to just 4.9% amid energy crisis

China’s economic growth slumps to just 4.9% amid energy crisis China’s economy recorded its most sluggish growth in a year for the third quarter of 2021, weighed by an energy ... Read more »

To please unions, Biden refuses to automate ports — fueling supply-chain woes

President Joe Biden won’t take action to help solve the current supply-chain crisis. REUTERS/Leah Millis From Christmas toys to clothing and auto parts, shortages of imported products are forcing factories ... Read more »

Retailers hope for sales recovery amid 'Living with COVID-19' scheme

SEOUL, Oct. 19 (Yonhap) — Beset by curfews and fewer customers amid the coronavirus pandemic, the retail industry in South Korea is now pinning hopes on a business rebound, as ... Read more »

Delhi Capitals' Rishabh Pant inks NFT deal with Rario

The NFTs would give cricket fans worldwide the opportunity to relive Pant’s explosive moments. Delhi Capitals captain and wicketkeeper Rishabh Pant signed a lucrative deal with cricket NFT platform Rario. ... Read more »

Biden's brain drain and other commentary

Colin Powell, former Joint Chiefs chairman and secretary of state, was battling cancer when he died. Douliery Olivier/ABACA USA/INSTA Culture watch: We’re the Divided States of America “Americans are so ... Read more »

US has dipped into recession as worried consumers flash warning signs: economists

Man stands in an unemployment line Bloomberg via Getty Images The US economy is careening into another recession, two noted economists warn, as worries about the labor market and the ... Read more »

(EDITORIAL from Korea Times on Oct. 19)

Long way to goMoon and Kishida disagree on historical issues President Moon Jae-in and Japanese Prime Minister Fumio Kishida failed to narrow their differences on key issues, such as Japan’s ... Read more »

(EDITORIAL from Korea Herald on Oct. 19)

Disappointing signalsMoves by Kishida suggests improvement in Seoul-Tokyo relations is way distant New Japanese Prime Minister Fumio Kishida sent an offering to a controversial war shrine in Tokyo on Sunday, ... Read more »

(EDITORIAL from Korea JoongAng Daily on Oct. 19)

A weird investigation In the National Assembly’s audit of the Gyeonggi provincial government on Monday, opposition lawmakers vehemently attacked the prosecution for its half-baked investigation into the grave Daejang-dong land ... Read more »

Cabinet did not stop improving Russia's investment climate in pandemic - Mishustin

According to Prime Minister, the capacities of existing enterprises were expanded in several regions of the country at once Read more »

Green energy transition more relevant than ever for Russia - Mishustin

Prime Minister added that the Russian government is already actively developing a regulatory system and a financing system for launching climate projects Read more »

China's economy slows as Covid, energy crisis and property woes take toll

China's economic growth tumbled more than expected in the third quarter, official data showed Monday, as the property sector struggled with tighter policy measures and an energy crisis loomed. After ... Read more »

Yandex sees interest in driverless deliveries in Dubai — company

At the moment, the negotiations between the potential partners are underway Read more »

Novatek does not believe in emergence of gas OPEC

Last week, Saudi Arabian Energy Minister Prince offered the Russian Deputy Prime Minister to consider the possibility of cooperation on the gas market Read more »

Russian PM invited foreign investors to jubilee SPIEF in 2022

It was reported that the jubilee 25th St. Petersburg International Economic Forum would be held from June 15 to 18 Read more »

Media: Number of new market participants in China's Sanya up 65% in January-September

Sanya attracts around 24,100 businesses and 19,700 individual entrepreneurs Read more »

Wipro Consolidated September 2021 Net Sales at Rs 19,668.90 crore, up 30.29% Y-o-Y

Reported Consolidated quarterly numbers for Wipro are: Net Sales at Rs 19,668.90 crore in September 2021 up 30.29% from Rs. 15,096.70 crore in September 2020. Quarterly Net Profit at Rs. ... Read more »

RBI remains net purchaser of US dollar in August

Reserve Bank of India (RBI) remained a net buyer of the US currency in August after it net purchased $3.747 billion from the spot market. In the reporting month, RBI ... Read more »

Russian economy's volume above pre-crisis level, PM says

It was reported that gross domestic product moved up by 4.7% over eight months of this year Read more »

European gas consumers didn't ask Novatek to increase supplies

At the moment, about 80% of the company's supplies on the spot market go to the Asia-Pacific countries, while Europe's portion is insignificant Read more »

Retail tomato prices skyrocket to Rs 93 per kg in metros as unseasonal rains damage crop

The retail price of tomatoes rose to Rs 93 per kg in metros on Monday on sluggish arrival in mandis amid reports of crop damage, owing to unseasonal rains, according ... Read more »

Russia, Guinea-Bissau to exchange business missions — Lavrov

The topics refer to cooperation in such spheres as natural resources tapping, infrastructure development, agriculture and fisheries Read more »