Stock market news briefing: ETMarkets Morning Podcast: Use this debt strategy to tide over rate worries

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Hi there, Good Morning. Welcome to ETMarkets Morning, the show about money, business and markets. I am Saloni Goel. Let’s start with the headlines first.

> Indians sent $2 billion abroad in September> ICICI Bank raises Rs 3,595 cr via infrastructure bonds> NSE’s unlisted shares rise amid HNI interest> Dream Sports bags $840 million in new funding

Now lemme give you a quick glance on the state of the markets.

Asian stocks were mixed as the dollar held near a 16-month high following Federal Reserve minutes that flagged the risk of a faster reduction in stimulus to fight elevated inflation. Japan’s Topix index rose 0.3%, Australia’s S&P/ASX 200 Index shed 0.2% and South Korea’s Kospi index declined 0.6%.

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Elsewhere, the yield on 10-year Treasuries declined three basis points to 1.63%. The US dollar traded at its highest in over a year to the euro and near a five-year high against the yen as a hawkish tilt by Federal Reserve policymaker contrasted to more dovish monetary outlooks in Europe and Japan.

Oil prices ticked lower with investors waiting to see how major producers respond to the emergency crude release by major consuming countries designed to cool the market, even as data pointed to healthy US fuel demand. Brent crude futures slipped 5 cents to $82.20 a barrel, after losing 6 cents on Wednesday.

That said, here’s what is making news.

Despite marquee institutional investors trimming stake in National Stock Exchange due to uncertainty over its proposed initial public offering, the unlisted shares of the exchange operator have risen nearly 7% in the last few days. Investors are lapping up the NSE shares as they believe that the shares could fetch a minimum premium of 50% when listed.

Predicting interest rate movement, just like timing the stock market, is a tricky business. Investors wanting to avoid forecasting the direction of interest rates could consider a debt strategy called ‘laddering’, which involves building a portfolio of different fixed income instruments across maturities.

Star Health and Allied Insurance Co will become the first pure-play health insurance company to list on the local stock exchanges, as it prepares to launch its Rs 7,249-crore initial public offering next week. The company could benefit from the increased awareness in the insurance market post Covid and that is what investors will buy the stock for assuming there is no third wave, said Asutosh Mishra, head of research at Ashika Securities.

LASTLY,

Mid-tier banks could offer higher returns compared to large banks in the near term barring a severe third wave of Covid-19, said Investec in a note. Raising its price targets on stocks such as City Union, Federal, CSB, Karur Vysya and DCB, the brokerage said in the absence of a third wave, they are optimistic on the recovery momentum of these mid-tier banks led by credit cost normalisation, improved credit growth and higher net interest margins (NIM).

NOW Before I go, here is a look at some of the stocks buzzing this morning…

ICICI Bank raised Rs 3,595 crore through infrastructure bonds for the second time this financial year, in what could signal demand revival in the sector as vaccinations and slowing infections rekindle hopes.

BSE has signed a Memorandum of Understanding (MoU) with the Madurai District Gold and Silver Merchant Association to provide an impetus for the growth and development of commodities and proposed Electronic Gold Receipt (EGR) market in India.

Reliance Industries Limited, through its subsidiary Reliance Strategic Business Ventures Ltd (RSBVL) will be acquiring the rights to own and operate a new franchise cricket team in the Emirates Cricket Board’s upcoming UAE T20 League.

Vodafone Idea (Vi) is likely to see almost 70% and 14% jumps in operating income and revenue respectively in FY22 following its decision to hike all prepaid tariffs by up to 25%, provided the loss-making telco doesn’t suffer any major resulting market share losses, say analysts.

Do also check out over two dozen stock recommendations for today’s trade from top analysts on ETMarkets.com.

That’s it for now. Stay with us for all the market news through the day. Happy investing!



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