Wipro’s Group Restructuring and Indian Oil Companies’ Q2 Challenges Amid Rising Crude Prices

Opening Bell:

Gift Nifty is up by 43.5 points in the early morning trade, indicating a positive opening for Indian stock market.

Asian markets are mixed as investors digest economic data from Japan and South Korea. South Korea’s August unemployment rate reached a historic low of 2%, dating back to June 1999. However, corporate confidence in Japan fell in September, affecting both manufacturers and non-manufacturers, according to the Reuters Tankan poll. Large manufacturers’ confidence dropped from +12 in August to +4. Non-manufacturers saw a nine-point decline, reaching +23 in September. Japan’s Nikkei 225 extended its three-day winning streak, opening up by 0.23%, while the Topix also gained 0.26%. South Korea’s Kospi edged up by 0.14%, while the Kosdaq declined by 0.67%. Australia’s S&P/ASX 200 slid 0.5% in early trading. Hong Kong’s Hang Seng index futures at 18,156 suggest a stronger open compared to the HSI’s previous close at 18,025.89.

US stock futures showed minimal movement on Tuesday night as investors awaited the release of the consumer price index (CPI) for insights into inflation. Dow Jones Industrial Average futures dipped by 0.02%, S&P 500 futures lost 0.02%, and Nasdaq 100 futures edged up by 0.04%. During Tuesday’s main trading session, all major indices posted losses. The Nasdaq Composite dropped 1%, primarily due to pressure on tech stocks. The S&P 500 fell nearly 0.6%, and the Dow decreased by less than 0.1%. Notably, Apple declined 1.7%, impacting overall index performance, and Oracle had its worst day in over two decades due to disappointing revenue and guidance.

Stocks News:

👉Wipro: Wipro Holdings (UK) has transferred 100% shareholding in Wipro 4C NV to Wipro IT Services UK Societas, effective September 12. Wipro Holdings (UK) and Wipro IT Services UK Societas are wholly owned subsidiaries of the company, while Wipro 4C NV is the step-down subsidiary. The rationalisation and simplification of the overall group structure is the objective behind the stake transfer       .

👉 BPCL/HPCL/IOC: Oil marketing companies (OMCs) including Indian Oil Corporation (IOC), Bharat Petroleum Corporation Ltd (BPLC) and Hindustan Petroleum Corp Ltd (HPCL) saw a downgrade in their July-September quarter (Q2) growth outlook after international crude oil prices sharply rose above $91 per barrel. Domestic brokerage firm Kotak Institutional Equities has ‘reduced’ their ratings on all three OMC stocks and has said that the companies have incurred losses over petrol and diesel sales with frozen retail prices and high crude oil rates.

👉 Vedanta: Anil Agarwal, the mining tycoon, has suggested that his publicly traded company Vedanta Ltd acquire Konkola Copper Mines from parent Vedanta Resources Ltd, which has regained control of one of the world’s largest copper mines from the Zambian government. After Agarwal, the Vedanta Group chair, in an uncharacteristic move, shared his views, many proxy advisory firms and investors raised questions about the group’s intention to potentially use the proposed transaction to repay its rising debt.

👉 KEC International: The RPG Group company has secured new orders worth Rs 1,012 crore across its various businesses including orders for transmission & distribution projects in India and Americas, and orders from new clients in the data centre and FMCG segments in India.

👉Foreign institutional investors (FII) sold shares worth Rs 1,047.19 crore, while domestic institutional investors (DII) bought Rs 259.48 crore worth of stocks on September 12, provisional data from the National Stock Exchange (NSE) showed

Domestic and International Events

• India’s headline retail inflation rate fell to 6.83% in August, data released by the Ministry of Statistics and Programme Implementation on September 12, as vegetable prices cooled somewhat compared to the previous month. At 6.83%, the Consumer Price Index (CPI) inflation print for August is 61 basis points lower than July’s 15-month high of 7.44%. However, it is the second month in a row that inflation has come in higher than the upper bound of the Reserve Bank of India’s (RBI) tolerance limit of 2-6%. It is also the 47th month in a row that it has stayed above the central bank’s medium-term target of 4%. One basis point is one-hundredth of percentage point.

• In July 2023, India’s industrial output surged by 5.7%, a significant increase from the 3.7% recorded in June 2023, as reported by the Ministry of Statistics and Programme Implementation. Key sectors contributed to this growth, with mining output rising by 10.7% compared to the previous year, manufacturing sector output growing by 4.6%, and Electricity output also registered a growth of 8%.

• Oil prices jumped about 2% to a near 10-month high on Tuesday on a tighter supply outlook and OPEC optimism over the resilience of energy demand in major economies. Brent futures rose $1.64, or 1.8%, to $92.28 a barrel by 11:15am EDT (1515 GMT). US West Texas Intermediate (WTI) crude rose $1.91, or 2.2%, to $89.20.
• Gold slipped to a more than two-week low on Tuesday as the dollar rebounded, while investors positioned for the US inflation print on Wednesday. Spot gold was down 0.6% at $1,909.50 per ounce, its lowest since August 25. US gold futures dipped 0.8% to $1,932.60.

Key Equity Indices

EMERGING	LATEST	% 1D
Hang Seng	18,026	(0.4) %
Shanghai Composite	3,137	(0.2) %

DEVELOPED	LATEST	% 1D
Dow Jones	34,646	(0.1) %
DAX	15,716	(0.5) %
FTSE 100	7,528	0.4 %
Nikkei	32,776	1.0 %
Straits Times	3,214	(0.1) %