..... . VALI disclosures . .....: 31/12/24, Most Asia-Pacific stocks declined on Tuesday tracking overnight losses on Wall Street. Markets in Japan and South Korea are closed. The S&P ASX 200 was 0.52% down, and Hang Seng was 0.42% higher as of 7:22 a.m.

Tuesday, December 31, 2024

31/12/24, Most Asia-Pacific stocks declined on Tuesday tracking overnight losses on Wall Street. Markets in Japan and South Korea are closed. The S&P ASX 200 was 0.52% down, and Hang Seng was 0.42% higher as of 7:22 a.m.

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On Monday, the Dow Jones Industrial Average and S&P 500 ended 0.97% and 1.07% down, respectively. The Nasdaq Composite ended 1.19% down.

The brent crude was trading 0.15% higher at $74.50 a barrel as of 7:12 a.m. The Bloomberg spot gold was 0.13% higher at $2,609.82 an ounce.

The GIFT Nifty was trading 0.20% or 46.50 points down at 23,656.50 as of 7:11 a.m.

The benchmark equity indices eroded early gains in the last leg of the trade to end lower on Monday. Broad-based weakness across Asia and Europe also put pressure on the indices.

The NSE Nifty 50 closed 168.50 points or 0.71% down at 23,644.90 and the BSE Sensex ended 450.94 points or 0.57% lower at 78,248.13.

Overseas investors have been net sellers for the 10th consecutive session and collectively offloaded stocks worth Rs 24,044.2 crore. Foreign portfolio investors offloaded stocks worth approximately Rs 1,893.2 crore on Monday, while the DIIs bought stocks worth Rs 2,173.9 crore, according to provisional data from the National Stock Exchange.

Trade Setup For Dec. 31: Nifty Consolidating Between 23,500 Support And 23,860 ResistanceStocks To Watch

Rail Vikas Nigam: The company emerged as the lowest bidder for a central railway project worth Rs 137.2 crore.
Flair Writing Industries: The company's arm, Flair Writing Equipments Pvt., incorporated step-down subsidiary Flomaxe Stationery to carry on the business of manufacturing and distribution of stationery and other allied products.
Mazagon Dock Shipbuilders: The company signed contract worth Rs 1,990 crore with the Ministry of Defence for Air Independent Propulsion Plug.
Clean Science and Technology: The company's arm Clean Fino-Chem has commenced commercial production of 2,5-Dihydroxy-1,4-Dithiane in a dedicated production block today.
Archean Chemical Industries: R Raghunathan has resigned as chief financial officer and KMP of the company due to personal reasons.
Prestige Estates Projects: The company's unit picked a 49% stake in WSI Falcon Infra Projects that is developing IT and IT-enabled services park in 6.53 acres of land situated at Porur, Chennai.
Power Grid Corp: The company acquired Rajasthan IV 4A power transmission for Rs 18.4 crore.
SBI Life Insurance: The board has approved the investment of Rs 6.6 crore to buy up to 10% stake in Bina Sugam.
Wipro: The deadline to acquire Applied Value Technologies Pte has been extended from December this year to January.
Vakrangee: The company partnered with Future General Insurance to offer general insurance products across its networks.
Shriram Properties: The company has sold a 3.9-acre plot in Chennai to a healthcare and education group and has signed an agreement for the sale or divestment of securities held in its subsidiary, SPL Shelters, to a group of individual buyers.
DCX Systems: NCLT approved the scheme of amalgamation of VNG Technology with Raneal Technologies.
Century Enka: KG Ladsaria, chief financial officer and KMP of the company, has resigned from his position.
Jubilant Ingrevia: The company's arm, Jubilant Infra, plans to acquire 6.67% stake in Forum I Aviation. The arm holds a 15.79% stake in FAPL post-acquisition.
Gokul Agro Resource: The company acquired fixed assets worth Rs 105.5 crore of Mangalore Edible Oil Refinery from Anagha Refineries. The acquisition will add a capacity of 100 TPD. The acquisition is funded out of borrowing and internal accruals.
Prataap Snacks: A fire at the Jammu manufacturing unit has damaged inventory, machinery, the building, and furniture, disrupting operations.
Lupin: The company announced the acquisition of Huminsulin in India from Eli Lilly and Company to further enhance its diabetes portfolio.
CESC: The company's arm, Noida Power Co, issued a letter of acceptance to unit Purvah Green Power for procurement of power.
Dhanlaxmi Bank: The RBI approved the appointment of P Suriaraj as executive director for a period of three years.
source: NDTV Profit
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Trade Cycles

The four important features of Trade Cycle are (i) Recovery, (ii) Boom, (iii) Recession, and (iv) Depression!

The trades cycle or business cycle are cyclical fluctuations of an economy. A full trade cycle has got four phases: (i) Recovery, (ii) Boom, (iii) Recession, and (iv) depression. The upward phase of a trade cycle or prosperity is divided into two stages—recovery and boom, and the downward phase of a trade cycle is also divided into two stages—recession and depression.

Phases of Trade Cycle:

The phases of trade cycle are explained with a diagram:

(1) Recovery:

In the early period of recovery, entrepreneurs increase the level of investment which in turn increases employment and income. Employment increases purchasing power and this leads to an increase in demand for consumer goods.

As a result, demand for goods will press upon their supply and it shall, thereby, lead to a rise in prices. The demand for consumer’s goods shall encourage the demand for producer’s goods.

The rise in prices shall depend upon the gestation period of investment. The longer the period of investment, the higher shall be the price rise. The rise of prices shall bring about a change in the distribution of income. Rent, wages, interest do not rise in the same proportion as prices.

Consequently, the margin of profit improves. The wholesale prices rise more than retail prices. The prices of raw materials rise more than the prices of semi-finished goods and the prices of semi-finished goods use more than the prices of finished goods.

(2) Boom:

The rate of investment increases still further. Owing to the spread of a wave of optimism in business, the level of production increases and the boom gathers momentum. More investment is possible only through credit creation. During a period of boom, the economy surpasses the level of full employment and enters a stage of over full employment.

(3) Recession:

The orders for raw materials are reduced on the onset of a recession. The rate of investment in producers’ goods industries and housing construction declines. Liquidity preference rises in society and owing to a contraction of money supply, the prices falls. A wave of pessimism spreads in business and those markets which were sometime before sellers markets become buyer’s markets now.

(4) Depression:

The main feature of a depression is a general fall in economic activity. Production, employment and income decline. The prices fall and the main factor responsible for it is, a fall in the purchasing power.

The distribution of national income changes. As the costs are rigid in nature, the margin of profit declines. Machines are not used to their full capacity in factories, because effective demand is much less. The prices of finished goods fall less than the prices of raw materials.

✳Reality Tips to Traders

1)Trading in the stock market is a marathon. 2)Protecting your capital is key. (Learn to protect first) 3)Making 0 on the day is better than losing 50k 4)Losses happen; they are part of this business. 5)It’s not you vs. the market. It’s you VS you. 6)You are your biggest enemy; learn to be mentally disciplined. 7)Don’t follow the majority; follow the correct path. 8)Traders without a stop loss end up not being traders for long. 9)There is always another trade. 10)The big money is made waiting for the right set-ups. 11)Waiting for the right trade is the most powerful strategy. 12)It is better to cut a loss than to wait to be proven right. 13)Position sizing can make or break you. 14)Worry about the downside before you even think about the upside. 15)Don’t listen to headlines

..BANKING TERMINOLOGY

There are various types of Banks: PSU Banks, Private Banks, Co-operative/Regional Banks, Small Finance Banks and Foreign Banks. When you deposit money in a bank, let's say the bank gives you an interest rate of 4%. But when the bank lends out this money, they lend it out at say, 12%. The difference of 8% in the above scenario is effectively the profit of the bank! The loans that do not pay interest for 90 days are known as Non-performing Assets. Banks have to provide for such bad loans. Structure of a Bank Asset for a Bank: The asset portion of a bank's capital includes cash, government securities, and interest-earning loans (e.g., mortgages, letters of credit, and inter-bank loans). Liabilities for a Bank: The bank's main liabilities are its capital (including cash reserves and, often, subordinated debt) and deposits. The latter may be from domestic or foreign sources (corporations and firms, private individuals, other banks, and even governments). Banks are required to maintain Liquidity with the Reserve Bank of India: SLR (Statutory Liquidity Ratio): It is the money a bank needs to preserve in the form of cash, gold or government Bonds before providing credit customers. This limitation is added by RBI on banks to make funds available to customers on-demand at your earliest convenience. Banks are required to maintain SLR at 18%. CRR (Cash Reserve Ratio): Banks are required to hold a certain proportion of their deposits in the form of cash. Banks don’t hold these as cash with themselves, but deposit such amounts with RBI / currency chests. CRR rate is at 4.5% currently. Repo Rate: The rate at which the RBI lends short-term money to the banks. The RBI through its Monetary Policy committee changes the repo rate to balance growth and Inflation. Reverse Repo rate: The rate at which banks park their short-term excess liquidity with the RBI. Now let us understand various terminologies for Banks Net Interest Income (NII): This is the spread the bank makes on its lending. It is calculated as Interest Income – Interest Expended Net Interest Margin (NIM): This is the spread the bank makes on its lending. It is the earning which is left after deducting the cost paid to depositors from its yields on Loans. This is denoted in % terms. The formula is Yield on Loans – Cost of funds Capital Adequacy Ratio (CAR): The capital adequacy ratio (CAR) is a measure of a bank's available capital expressed as a percentage of a bank's risk-weighted credit exposures. Essentially, it is the Capital that is available to lend. Tier I Capital – In simple words this capital is freely available with the bank to lend out. Tier II Capital- This is the capital tied up somewhere and is less freely available to lend. In case of an adverse event, the bank can use this capital to lend. Under Basel III norms, a bank’s tier 1+tier 2 capital must be a minimum of 8% of its risk-weighted holdings. The minimum capital adequacy ratio, also including the capital conservation buffer, is 10.5%. Current Account Saving Account (CASA)- There is no interest paid on the Current Account and a small interest rate is paid on a savings account. The combination of both is called CASA which shows the liabilities of the bank on which it pays relatively less interest. Deposits: Bank deposits are a savings product that customers can use to hold an amount of money at a bank for a specified length of time. In return, the financial institution will pay the customer the relevant amount of interest, based on how much they choose to deposit and for how long. Now let us come to NPA. Gross NPA (GNPA): It is the total loans on which no payment has been paid for 90 days or more. GNPA % is usually shown in each Bank’s quarterly results. The percentage is basically the GNPA amount as a % of the total advances. Slippages: Slippages denote the fresh amount of loans that have turned bad in a year. The slippage ratio of a bank is calculated as Fresh accretion of NPAs during the year /Total standard assets at the beginning of the year multiplied by 100. Provisioning Coverage Ratio (PCR): This is the ratio of provisioning to GNPA and indicates the extent of funds a bank has kept aside to cover loan losses. For Instance, a company has GNPAs of Rs 100 and they have set aside 50 Rs, then the PCR is 50%. Net NPA (NNPA): The total figure left after deducting provisions made for bad loans from GNPA. (GNPA – Provisions+upgrades/writeoffs = NNPA) Special Mention Account (SMA) SMA-0 is a category in which stress with respect to the principal and interest has remained overdue for a period of 0 to 30 days. SMA-1 is a category in which stress with respect to the principal and interest has remained overdue for a period of 30-60 days. SMA-2 is a category in which stress with respect to the principal and interest has remained overdue for a period of 60-90 days

..... . VALI disclosures . .....

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Tuesday, December 31, 2024

31/12/24, Most Asia-Pacific stocks declined on Tuesday tracking overnight losses on Wall Street. Markets in Japan and South Korea are closed. The S&P ASX 200 was 0.52% down, and Hang Seng was 0.42% higher as of 7:22 a.m.

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Today's

01/02/25, Finance minister Nirmala Sitharaman has pegged India's nominal growth at 10.1 percent for FY26, higher than 9.7 percent in the previous fiscal.

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