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Sensex jumps 514 points led by metal, realty stocks

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Updated:1 year, 5 months ago

Mumbai, Sep 21 (ANI): Equity benchmark indices rose on Tuesday despite a volatile trading session with IT, metal and realty stocks gaining ground. At the closing bell, the BSE S&P Sensex was up by 514 points or 0.88 per cent at 59,005 while the Nifty 50 advanced by 165 points or 0.95 per cent to 17,562. Except for Nifty auto and PSU bank, all other sectoral indices were in the green with Nifty realty moving up by 3.6 per cent, metal by 2.5 per cent and IT by 1.9 per cent. Among stocks, Godrej Properties jumped 4.9 per cent to Rs 1,725.25 per share while DLF Ltd gained 2.4 per cent to Rs 330.75. Energy major ONGC rose by 5.2 per cent to Rs 135.15 per share. JSW Steel was up by 5.9 per cent, Tata Steel by 3.5 per cent and Hindalco by 1.5 per cent. The other prominent gainers were Bajaj Finance, IndusInd Bank, Tech Mahindra, HCL Technologies, Infosys, Dr Reddy’s and Eicher Motors. However, Maruti Suzuki, Hero MotoCorp and Bajaj Auto traded with a negative bias along with HDFC Bank, Axis Bank and FMCG major Britannia.

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Seven Adani group stocks end lower amid weak broader market trend

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Out of the ten listed firms of the Adani group, seven companies ended the day in the negative territory on Friday amid a weak trend in the broader market.

However, shares of Adani Green Energy jumped 4.84 per cent, Adani Transmission climbed 3.78 per cent and Adani Total Gas gained 2.49 per cent(PTI)
However, shares of Adani Green Energy jumped 4.84 per cent, Adani Transmission climbed 3.78 per cent and Adani Total Gas gained 2.49 per cent(PTI)

The stock of NDTV tumbled 4.87 per cent, Adani Power tanked 4.27 per cent, Adani Wilmar dropped 3.24 per cent, Adani Enterprises fell 2.90 per cent, Adani Ports declined 2.56 per cent, ACC dipped 2.08 per cent and Ambuja Cements ended marginally lower by 0.01 per cent on the BSE.

NDTV hit its lower circuit limit during the day.

However, shares of Adani Green Energy jumped 4.84 per cent, Adani Transmission climbed 3.78 per cent and Adani Total Gas gained 2.49 per cent.

In a volatile trade, the 30-share BSE Sensex fell 398.18 points or 0.69 per cent to finish at 57,527.10.

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The group stocks have taken a beating on the exchanges since the report by US-based short-seller Hindenburg Research came in January this year.

Stocks of eight Adani group companies out of the 10 listed entities closed in the green territory on Wednesday. On Thursday, five group stocks ended higher, while five of them finished lower.

Meanwhile, the NSE and BSE had on Wednesday said they will include Adani Power under the short-term additional surveillance measure (ASM) framework from Thursday.

Adani Power is shortlisted in short-term ASM framework Stage-I effective March 23, according to separate circulars available on the exchanges.

The parameters for shortlisting securities under ASM include high-low variation, client concentration, number of price band hits, close-to-close price variation and price-earning ratio.

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Ubs: Deutsche Bank, UBS hit as bank fears spark stress signals

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LONDON: European banking stocks fell sharply on Friday, with Deutsche Bank and UBS knocked by worries that actions by regulators and central banks have not yet contained the worst problems to face the sector since the 2008 global financial crisis.
Financial market stress indicators were also again flashing warning signs more widely, with the euro falling against the dollar and bond yields sinking.
Deutsche Bank shares fell for a third day, dropping more than 12% after a sharp jump in the cost of insuring its bonds against the risk of default.
Shares in Germany’s largest bank have lost a fifth of their value so far this month and the cost of its 5-year credit default swaps (CDS) – a form of insurance for bondholders – jumped to a four-year high on Friday, based on data from S&P Market Intelligence.
“Deutsche Bank has been in the spotlight for a while now, in a similar way to how Credit Suisse had been,” said Stuart Cole, head macro economist at Equiti Capital.
“It has gone through various restructurings and changes of leadership in attempts to get it back on a solid footing but so far none of these efforts appear to have really worked.”
Deutsche Bank declined to comment.
The pain was spread across the sector, with the index of top European banks falling 5.1% and British banks losing 4%, down for a third straight session.
“We are still on edge waiting for another domino to fall, and Deutsche is clearly the next one on everyone’s minds (fairly or unfairly), said Chris Beauchamp, chief market analyst at IG.
The fresh falls in Europe came as investors were looking to see how farUS authorities would go to shore up the banking sector, particularly fragile regional lenders.
US treasury secretary Janet Yellen told lawmakers on Thursday that bank regulators and the Treasury were prepared to make comprehensive deposit guarantees at other banks, as they did at failed Silicon Valley Bank (SVB) and Signature Bank.
Shares of major US banks JPMorgan Chase & Co, Wells Fargo and Bank of America fell more than 2% in premarket trade on Friday.
Regional lenders, the focus of the strongest investor concerns, also declined, with First Republic Bank, PacWest Bancorp, Western Alliance Bancorp and Truist Financial Corp falling between 2% and 5%.
“Underlying sentiment is still cautious and in this environment no one wants to go into the weekend risk-on,” said Nordea chief analyst Jan von Gerich.
UBS challenges
The global banking sector has been rocked since the sudden collapse this month of SVB and Signature Bank.
Policymakers have stressed the turmoil is different from the global financial crisis 15 years ago, saying banks are better capitalised and funds more easily available.
But the worries spread quickly, and on Sunday UBS was rushed into taking over Swiss rival Credit Suisse after it lost the confidence of investors.
Swiss authorities and UBS are racing to close the takeover within as little as a month, according to two sources with knowledge of the plans.
Separate sources told Reuters that UBS has promised retention packages to Credit Suisse wealth management staff in Asia to stem a talent exodus.
Brokerage group Jefferies cut its recommendation on UBS stock to “hold” from “buy”, saying the acquisition of its former rival would change an equity story based on a lower risk profile, organic growth and high capital returns.
“All these elements, which is what UBS shareholders bought into, are gone, likely for years,” it said.
UBS shares were down 7% on Friday and its five-year CDS shot up 14 basis points.
AT1 bonds
The rescue of Credit Suisse has also ignited broader worries about investors’ exposure to a fragile banking sector. The decision to prioritise shareholders over Additional Tier 1 (AT1) bondholders rattled the $275 billion AT1 bond market.
These convertible bonds were designed to be invoked during rescues to prevent the costs of bailouts falling onto taxpayers.
As part of the deal with UBS, the Swiss regulator determined that Credit Suisse’s AT1 bonds with a notional value of $17 billion would be wiped out, stunning global credit markets.
European banks’ AT1 debt came under fresh selling pressure on Friday, with Deutsche Bank and UBS AT1s down around four and two cents in price, respectively, according to Tradeweb data.
Standard Chartered Chief Executive Bill Winters said on Friday the wipeout of Credit Suisse bondholders had “profound” implications for global bank regulations.
“I think it had very profound implications for the regulation of banks, and for the way that banks manage themselves,” Winters told a financial forum in Hong Kong.
He also said theUS Federal Reserve’s move to guarantee non-insured deposits was a “moral hazard”.
US authorities had invoked “systemic risk exceptions” after the failures of SVB and Signature Bank that allowed them to protect uninsured deposits, including those of wealthy technology executives and cryptocurrency investors.

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Govt raises tax on stock options to dampen retail frenzy

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NEW DELHI: The government has raised the transaction tax on certain equity derivative products, a move that may help reign in the frenzied activity in such instruments from retail investors.
Selling an option on a security will attract a tax of 0.0625% from April 1, compared with 0.05% previously, a finance ministry official told reporters after amendments to the Finance Bill were approved by Parliament on Friday. Tax on sale of a futures contract will be 0.125% against 0.01% now.
“One may view it as a revenue generation avenue of the government, but the main idea behind this amendment seems to be to discourage investors from excessive trading in F&O,” said Rahul Charkha, partner at Mumbai-based law firm Economic Laws Practice.
A study from the capital markets regulator found a 500% jump in individual traders in the equity derivatives segment in the year ended March 2022, compared to 2019. Nine of 10 such traders incurred net losses, the data showed.
Individual investors accounted for 35.6% of premium turnover in index options as of January 31, a rise from 28.8% in the year ending March 31, 2020, according to data available on the National Stock Exchange’s website. Share of such investors in turnover of stock options traded on the NSE stood at 31.5% as of January, up from 29.2% in March 2020.

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