Sensex, Nifty open flat; Axis Bank and SBI Top Losers

Those losses came after China’s antitrust regulator ordered Tencent to give up its exclusive music licensing rights and slapped a fine on it for anti-competitive behavior, marking yet another development in Beijing’s ongoing crackdown on its domestic internet titans.

The Hang Seng and the Shanghai Composite are down by 2.8% and 2.2%, respectively.

Japan's Nikkei is trading higher by 1.1%.

In US stock markets, Wall Street indices closed at record highs on Friday after a rocky week in which investors fretted over the Delta coronavirus variant and cheered an economic recovery.

All three major US stock indexes finished at all-time highs after each posted weekly gains of more than 1%.

The Dow Jones Industrial Average closed above 35,000 for the first time ever, bringing its gain for 2021 to more than 14%.

The Nasdaq Composite climbed 1% to 14,837.

Back home, Indian share markets have opened on a flat note.

Axis Bank, DLF, L&T, SBI Life, Tata Motors, and Vedanta are among the companies slated to report their June quarter results today.

The BSE Sensex is trading down by 76 points. Meanwhile, the NSE Nifty is trading lower by 19 points.

ITC and Infosys are among the top gainers today. SBI, on the other hand, is among the top losers today.

The BSE Mid Cap index has opened on a flat note. The BSE Small Cap index is trading higher by 0.3%.

Sectoral indices are trading mixed with stocks in the FMCG sector and healthcare sector witnessing buying interest.

Banking stocks, on the other hand, are trading in red.

Shares of Schaeffler India and Lux Industries hit their 52-week highs today.

The rupee is trading at 74.47 against the US$.

Gold prices are trading down by 0.2% at ₹47,540 per 10 grams.

Meanwhile, silver prices are trading down by 0.5% at ₹67,030 per kg.

In news from the insurance sector, as per an article in The Economic Times, the government is ready with a proposal to amend insurance laws to privatise one of the three unlisted general insurance companies.

The draft bill, which has been sent for approval by the Union Cabinet before introducing it in Parliament, seeks to remove the 51% floor on government holding.

Foreign investors will be able to hold up to 74% in the divested general insurance firm subject to Indian management and control, as per government sources.

The article also stated that the centre has ruled out plan to sell New India Assurance (NIACL) or GIC.

While NITI Aayog has suggested the name of at least one general insurer to be privatised, a decision on which one of the three - United India, National or Oriental Insurance will be privatised is yet to be taken.

The name has been shared with the department of investment and public asset management (DIPAM) and will be recommended by a panel of secretaries with ministerial panel taking a call on it before it is endorsed by the Union Cabinet.

In the budget, finance minister Nirmala Sitharaman had announced the privatisation of one general insurance company and two public sector banks (PSBs), for which the process is yet to commence.

Reportedly, NITI Aayog has identified Central Bank of India and Bank of Maharashtra for privatisation.

The process for listing of Life Insurance Corporation (LIC) has already begun, which will happen later in this financial year.

How the above developments pan out remains to be seen.

Speaking of the insurance sector, have a look at the chart below which shows the investment assets of non-life insurers and life insurers over the past 10 years:

Investment Assets of Non-Life Insurers 11x That of Life Insurers

As per Tanushree Banerjee, Co-Head of Research at Equitymaster, the above chart is enough proof of how big an earning opportunity is the zero-cost float to the non-life insurers. Their investment assets under management is nearly 11 times that of life insurers.

Tanushree recently recommended a high-quality stock from this space, to her StockSelect subscribers.

If you want to become a subscriber, here's where you can sign up.

Moving on to news from the banking sector, Yes Bank is among the top buzzing stocks today.

Yes Bank on Saturday reported a four-fold jump in its net profit to ₹2.1 bn for the quarter ended June 2021.

This is the highest quarterly profit since December 2018.

The net profit was aided by a 41% year-on-year (YoY) fall in provisions during the reported quarter.

Yes Bank’s net interest income (NII) in the quarter slumped 26.5% YoY to ₹14 bn.

The bank’s gross non-performing loans ratio rose to 15.6% in the June quarter from 15.4% in the previous quarter.

However, net NPA ratio declined sequentially to 5.78%.

While the overall advances fell 1% in the June quarter, the lender reported 23% growth in its retail and small businesses loan book.

The current account-savings account (CASA) ratio improved to 27.4% and remained on-track to meet the lender’s guidance of more than 30% in fiscal 2022.

Yes Bank share price has opened the day up by 6.2%.

This article is syndicated from Equitymaster.com