Market round-up: Will increase in China Producer Prices Index sustain

What augurs well is that economists expect China’s producer prices to keep rising, thanks to a more flattering base last year


Graphics by Ajay Negi/Mint
Graphics by Ajay Negi/Mint

China’s Producer Prices Index (PPI) rose for the first time after 54 months, surprising markets.

The measure rose 0.1% in September compared to a year earlier.

In August, the index had declined 0.8%.

A Reuters news report, citing the National Bureau of Statistics, said prices of ferrous metals, non-ferrous metals and coal together rose 4.1% year-on-year, a key factor in PPI turning positive.

What augurs well is that economists expect China’s producer prices to keep rising, thanks to a more flattering base last year.

Needless to say, if the momentum sustains, it will be a welcome relief for advanced nations battling deflation.

Indian HNIs still wary of shares

Stock markets in India may be booming but the country’s high networth individuals (HNIs) still rank low as buyers of shares.

Indian HNIs invested just 18.8% of their wealth in stocks during the first quarter of 2016, the lowest to equities among HNIs of the Asia-Pacific region, a wealth management survey by Capgemini showed.

Fixed income and real estate were still the preferred asset classes with investments of 21.6% and 20.2% of their wealth, respectively.

Rich Indians preferred to hold cash (about 21% of the total wealth) and HNIs in other countries in the region showed the same tendency.

Indian HNIs were also highly leveraged, the report said, adding that 33.6% of the investment was through credit.

Hydropower generation picks up

Hydropower has finally picked up. Generation grew 14% in September.

That said, despite a timely and normal monsoon this year, power generation did not see any noticeable growth in earlier months.

Generation was down 0.1% in July and 0.6% in August compared with the respective months a year ago, shows data from the Central Electricity Authority.

To be sure, the growth in September was partly aided by a favourable base as in September 2015 power generation had dropped 23%.

According to Elara Securities (India) Pvt. Ltd, public sector enterprises clocked good generation growth in September. NHPC Ltd’s volumes grew 17% at a consolidated level.

Generation at SJVN Ltd was up 7%.

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