BQuick On Nov. 29: Top 10 Stories In Under 10 Minutes

This is a roundup of the day’s top stories in brief.

1. GDP Growth Falls To 4.5%

The Indian economy slowed further in the July-September 2019 quarter, as consumption failed to revive and private investment remained stagnant. Government expenditure, however, picked up pace and helped hold up the economy.

• Gross domestic product growth came in at 4.5 percent in the second quarter of 2019-20 compared to 5 percent in the first quarter, showed data released by the Central Statistics Office on Friday.
• In gross value added terms, the economy grew at 4.3 percent compared to 4.9 percent in the previous quarter.
• A Bloomberg poll of 41 economists had estimated GDP growth at 4.5 percent in Q2. GVA was estimated at 4.4 percent, according to 27 economists.
• In the current GDP series, the lowest growth rate recorded was 4.3 percent in the fourth quarter of FY13.
• The growth rate for the second quarter of FY20 is the lowest since then. India’s GDP has now moderated for the sixth straight quarter from 8.1 percent in the quarter ended March 2018, to 4.5 percent now.

Nominal GDP growth hit a decade-low.

India’s fiscal deficit widened in October over the previous month.

• The gap between the government’s revenue and expenditure rose to Rs 7.20 lakh crore as of October, according to data released by the Controller General of Accounts.
• That’s 102.4 percent of the budgeted estimate of Rs 7.04 lakh crore for 2019-20.
• In September, the fiscal deficit stood at 92.6 percent of the target. Still, the fiscal deficit level is lower than that of October last year when it had reached 103.9 percent of the FY19 target.
• Capital expenditure stood at Rs 2.01 lakh crore in October 2019, 59.5 percent of an estimate of Rs 3.38 lakh crore.

Here are the other highlights.

2. RBI Files For Insolvency Proceedings Against DHFL

The Reserve Bank of India said it has filed for insolvency proceedings to be initiated against Dewan Housing Finance Corporation Ltd.

• The action, it said, was initiated under powers vested with it through a recent amendment to the Insolvency and Bankruptcy Code.
• Under the new norms, an interim moratorium will apply on the housing financier until the case is either admitted or rejected by the National Company Law Tribunal, the central bank said in a notification.
• Under the moratorium, no other legal proceedings can be initiated or continued against DHFL.

Transferring, encumbering, alienating or disposing of assets or legal rights will not be allowed.

3. Bulls Interrupted: Ramesh Damani

In BloombergQuint’s Bulls Interrupted series, the veteran investor shared strategies for recalibrating portfolios when a bull market pauses.

Some of the topics he discussed were:

• Dealing with unforeseen bear markets
• The iron rule of finance
• Overlooked opportunities
• The upcoming recovery

Watch the full episode here.

4. Sensex Slips, U.S. Stocks Drop

Indian stocks fell, retreating from a third record-high close this week, ahead of the release of the September quarter growth numbers.

• The S&P BSE Sensex Index declined 0.8 percent to 40,793.81.
• Twenty-seven of 31 Sensex shares dropped, while four gained.
• Reliance Industries Ltd. contributed the most to the index decline, with a 1.8 percent fall; Tata Motors Ltd. was the biggest loser, slipping 2.8 percent.
• Bharti Airtel Ltd. gained 1.3 percent and was the biggest gainer.
• The Sensex marked a third straight month of gains, the longest such streak since May.
• Shares of Indiabulls Housing Finance Ltd. erased gains after the Delhi High Court gave regulators more time to submit their findings.
• Fifteen of 19 sector sub-indexes compiled by BSE Ltd. fell, led by a gauge of metal companies.

Follow the day’s trading action here.

U.S. stocks opened lower in the wake of mixed results in Europe and lower Asian equities, signaling a lackluster finale to the third straight month of gains for global benchmarks.

• The S&P 500, Nasdaq 100 and Dow Jones Industrial Average all edged lower as trading resumed on Wall Street after the Thanksgiving break.
• U.S. Treasuries drifted as they returned to trading post-holiday.
• West Texas Intermediate crude sank 1.8 percent to $57.04 a barrel, the lowest in more than a week on the biggest tumble in more than a week.

Get your daily fix of global markets here.

5. SAT Asks SEBI To Decide On Karvy’s Plea Seeking Power To Settle Trades

The Securities Appellate Tribunal asked the market regulator to consider Karvy Stock Broking Ltd.’s plea seeking nod to conduct certain transactions on behalf of clients after SEBI restrained depositories from acting on its instructions.

• Karvy argued that it needed the powers to settle trades with exchanges for its clients as any delay will cause losses to them.
• The broker moved the appellate tribunal seeking a limited modification in the Nov. 22 order of the Securities and Exchange Board of India that had barred it from taking on new customers and from dealing with their money.
• The regulatory action came after SEBI found that the broker had sold clients’ securities and used funds for its own purposes.
• The counsel for the broker informed the tribunal that it will separately explore legal options for challenging the main order.

SEBI opposed the modification of the order.

6. Swiss Firm Outbids DIAL, Adani To Develop Jewar Airport

Zurich Airport International AG will build a second airport for New Delhi, after offering to pay more to the government than billionaire Gautam Adani and the operator of the existing airport in the Indian capital.

• Zurich Airport will pay a state-owned authority a fixed Rs 400.97 per passenger, Shailendra Bhatia, a nodal officer for the Noida airport project, told Bloomberg News in a text message.
• Adani Enterprises Ltd. offered to pay Rs 360 for every passenger, while Delhi International Airport Ltd. offered Rs 351, Bhatia said.
• Zurich Airport will invest about 650 million Swiss francs ($650 million) in the first phase during a construction period of about 4 years, it said in a statement.

The project will cost a total of Rs 29,560 crore ($4.1 billion) in four phases.

8. Why Shapoorji Pallonji Group Is Facing A Tough Time

For decades, billionaire Pallonji Mistry’s construction empire could raise capital easily as lenders, besides a stable business, took comfort in his family’s 18.4 percent stake in Tata Sons Ltd.

However, that cushion isn’t enough anymore for India's credit markets.

• The first sign the group may not be immune to the trouble came when it had to cut the size of the initial public offering of subsidiary Sterling and Wilson Solar Ltd. to Rs 2,850 crore from Rs 4,500 crore.
• Then, Shapoorji Pallonji and Company Ltd.— the holding company for the group’s 350 listed and privately held firms, couldn’t honour its commitment made in the prospectus to repay Rs 2,563 crore worth of inter-corporate deposits.
• While the company cited adverse market conditions, credit rating agencies have flagged the company’s rising debt, support to group companies and delay in monetising assets.

Take a look at the group’s debt, repayments due this financial year and its financials.

9. Japan Won't Sign RCEP If India Doesn't Join

Japan is not considering signing a Chinese-backed regional trade pact without India, the top Japanese negotiator said on Friday, ahead of a series of diplomatic exchanges in the coming weeks that include a visit to Delhi by Prime Minister Shinzo Abe.

• India announced this month it was withdrawing from the Regional Comprehensive Economic Partnership, citing the deal’s potential impact on the livelihoods of its most vulnerable citizens.
• China said that the 15 remaining countries decided to move forward first and India was welcome to join RCEP whenever it’s ready.
• “We aren’t thinking about that at all yet,” Deputy Minister for Economy, Trade and Industry Hideki Makihara, said in an interview with Bloomberg. “All we are thinking of is negotiations including India.”

Abe has sought to beef up ties with India to balance China’s regional dominance.

10. Thackeray Announces Stay On Aarey Metro Car Shed Project

Maharashtra Chief Minister Uddhav Thackeray announced a stay on construction of metro car shed project in Mumbai’s green lung Aarey Colony, where protests were held last month against cutting of trees for the work.

• Speaking to reporters soon after taking charge as Chief Minister in Mantralaya, Thackeray said not a single tree leaf will be cut till further developments.
• A Supreme Court bench had last month sought a status report with pictures on plantation, transplantation and felling of trees in Aarey colony area.
• The Bombay High Court had on Oct. 4 refused to declare Aarey Colony a forest and declined to quash the Mumbai municipal corporation's decision to allow felling of over 2,600 trees in the green zone to set up a metro car shed.
• Former Chief Minister Devendra Fadnavis responded saying the move shows that the Shiv Sena-Nationalist Congress Party-Congres government isn’t serious about Mumbai Infrastructure projects.

Common Mumbaikars will suffer most, tweeted Fadnavis.