Mumbai: Even though selling has abated a bit, global markets continue to trade with negative momentum. Investors are worried that Spain would eventually need outside help to rescue its troubled banks.
Also leading to increasing concern is the weak economic data from the US. According to a Reuters report, private payrolls picked up only slightly in May and claims for jobless benefits rose last week. The weak data is pointing to anaemic recovery in the US jobs market, which in turn is weighing on the Asian stock markets.
Japan’s Nikkei fell 0.75% to 8,478 on selling in shares of export dependent companies. Overnight, US markets also closed lower. S&P 500 at 1,310 lost 0.23% on selling in energy shares.
The negative momentum, though, has one positive implication for India. Brent crude prices have fallen below $102 to $101.53 a barrel on speculation that slowing global economy would crimp fuel demand.
Back home, keep an eye on state owned oil companies. Easing crude prices could provide some relief to upstream firms on the subsidies front. For oil marketing companies, the under-recoveries could reduce a bit.
The falling price of crude could also provide some support to airline stocks. Oil companies have cut jet fuel prices by 2%. Read the Business Standard report.
ONGC and Colombia’s Ecopetrol SA have agreed to share technical expertise related to oil exploration. Technical collaboration may eventually lead to ONGC buying stakes in the Colombian firm’s energy assets. Read the Mint report.
DLF is aiming to close three divestment deals in the first half of the current fiscal, reports Mint. The company wants to raise money through selling stakes in its hotel business, a prime plot in Mumbai and the wind energy business.
After United Spirits, United Breweries also reported a sharp fall in profits. The beer-making arm of Vijay Mallya-led UB Group, said its profits dropped 82.5% to Rs 7 crore in the quarter ended March from a year earlier. The earnings were hit by increased input prices and a one-time cost.
Reliance Power and Shell are planning to set up a LNG terminal in Andhra Pradesh, reports The Economic Times. The plant is expected to have a capacity to import five million tonnes of LNG a year.
Keep an eye on Bharati Shipyard stock. According to the Business Standard, lenders are expected to consider final debt recast proposal today.
Finally, to combat obesity New York City is planning to ban the sale of large carbonated drinks in restaurants and some other places. The proposal is expected to take effect as soon as next March. Read The New York Times report.