As the country grapples with a nation-wide lockdown in an response to containing the spread of deadly respiratory illness Coronavirus, the stock markets are expected to remain volatile. Focus will continue to be at the pace of spread of Coronavirus in the country. The number of people infected with the novel virus has escalated past the 1,000 mark with the number of deaths climbing to 27. Let us look at the stocks that will be in focus as markets open on Monday:
- Sun Pharmaceuticals Ltd: The US health regulator has classified Sun Pharma's Halol facility in Gujarat as Official Action Indicated (OAI). The United States Food and Drug Administration (USFDA) had inspected the facility from December 03-13, 2019 and had issued eight observations, the company said in a statement to the stock exchanges on Sunday. OAI means that pending product approval from the facility could be withheld by the regulator. Earlier in December, the plant had been issued Form 483 by USFDA with eight observations. This has escalated into an OAI classification. Sun Pharma has said that it continues to cooperate with the USFDA and will undertake all necessary steps to resolve these issues and to ensure that the regulator is completely satisfied with its remedial action.
- Hero MotoCorp Ltd: The country’s largest two-wheeler manufacturer Hero MotoCorp said it is invoking force majeure to suspend full payments to vendors, since it has no visibility of receivables, with sales having come to a standstill because of the Covid-19 lockdown, media reports suggested. The decision follows the Supreme Court refusing to grant an extension of the March 31 deadline by which sales of BS-4 vehicles have to stop, despite the lockdown. It, however, allowed 10% of remaining BS-4 stock to be sold in 10 days after the lockdown gets over, except in Delhi-NCR, in its ruling on Friday.
- Coffee Day Enterprises Ltd: The owner of Café Coffe Day chain said that it has paid Rs1,644cr to its lenders, which has pared the company’s debt to Rs3,200cr from Rs4,900cr earlier. In a statement to the stock exchanges post market hours Friday, Coffee Day said that it has repaid the money from the first tranche of funds received from the sale of Global Village Tech Park to Blackstone Group and Salarpuria Sattva Group. It received Rs2,000cr in the first tranche and the remaining amount will be received after getting a few statutory approvals.
- IndiaNivesh Ltd: Investment advisor IndiaNivesh has decided to close its scheme in portfolio management services business due to recent market turmoil and challenging economic circumstances. The company said they would be depositing client money in their respective bank accounts. The PMS business was launched in March 2015 and currently managed a portfolio of Rs60cr with around 190 clients. The PMS business has around 30% cash including liquid investments in its portfolio.
- Telecom companies: Telecom regulator TRAI has given six weeks additional time to telecom companies to file monthly and quarterly reports that are otherwise due in April. The decision comes within days of industry body COAI writing to the Telecom Regulatory Authority of India (TRAI) for granting additional time to telecom companies to file such reports, citing operational challenges amid the 21-day nationwide lockdown to counter the spread of coronavirus.
- Abbott India Ltd: Abbott Laboratories Ltd, the parent group off Abbott India has received approval to issue a coronavirus test that detects if someone is infected with the respiratory disease within 5 minutes. Abbott Laboratories on Friday announced that the U.S. Food and Drug Administration (FDA) has issued the Emergency Use Authorisation (EUA) for the fastest available “molecular point-of-care” test to check for Covid-19. The test can detect positive results in five minutes, while negative results take about 13 minutes. The test is small, lightweight and portable.
- Aviation companies: Aviation Ministry has allowed use of passenger aircraft for cargo movement. SpiceJet Ltd and Interglobe Aviation (Indigo) have offered their services for movement of cargo.
- PSU banks' merger: Reserve Bank of India has said that the merger of 10 state-run banks into four will come into force from April 1. The branches of merging banks will operate as of the banks in which they have been amalgamated. As per the scheme, Oriental Bank of Commerce and United Bank of India will be merged into Punjab National Bank; Syndicate Bank into Canara Bank; Allahabad Bank into Indian Bank; and Andhra and Corporation banks into Union Bank of India.
- State Bank of India: State Bank of India (SBI) has passed on the complete rate cut benefits to its borrowers availing loans linked to external benchmark linked lending rate (EBR) and repo linked lending rate (RLLR). This was done after the Reserve Bank of India announced a 75 bps cut in repo rate. Following the reduction in interest rate, SBI's external benchmark linked lending rate will come down to 7.05% per annum from 7.80% earlier. Similarly, SBI's linked lending rate will reduce to 6.65% per annum from existing 7.40%.
- Vedanta Ltd: Metals and mining magnate Anil Agarwal has, for the first time, taken a board position on his flagship Indian firm, Vedanta Ltd, replacing his brother Navin. The Indian flagship Vedanta Ltd houses its oil and gas, aluminium, power, iron ore, steel and copper business. Until now, Agarwal has only headed the board of London-headquartered Vedanta Resources. In a statement to the stock exchanges, the company said Agarwal has been appointed as the non-executive chairman of Vedanta Ltd. He replaces his brother Navin, who will now be the Executive Vice Chairman of the Board.
U.S. stocks continued their slide to end the week in red, after failing to get a lasting lift from approval by Congress of a $2 trillion economic stimulus package to counter the effects of the coronavirus pandemic. The Dow Jones Industrial Average dropped 4.05% or 915.39 points to close at 21,636.78 , while the S&P 500 index fell 88.60 points, or 3.4%, to 2,541.47The Nasdaq Composite Index lost 295.16 points, or 3.8%, to finish at 7,502.38.
Markets have been focused on the rising cases of COVID-19 in the U.S. which has now identified more infections than China. here are now nearly 86,000 confirmed cases of the disease in the U.S., compared with about 82,000 in China, according to data compiled by Johns Hopkins University. In U.S. economic reports, a reading of consumer spending showed an increase of a mild 0.2% in February, the government said Friday. Spending, the main engine of the economy, had slowed a bit in 2020 ahead of the coronavirus. Spending is expected to dramatically weaken in the next few months as the economy falls into recession.