Powell’s Fed Rate Cues, Reliance AGM To Boost Indian Stocks

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(Bloomberg) — Before the trading day begins, we’ll cover the key news and events that could move the market. Today we look at:

• Reliance AGM is near
• Indian IPOs outpace US
• Birla painting

Good morning, this is Chiranjivi Chakraborty, an equity reporter in Mumbai. Indian shares are set to follow Asian markets higher, as the prospect of Federal Reserve interest rate cuts boosted sentiment. The upbeat backdrop should keep Indian bulls buoyant as we begin the last week of August. It will be an important event, with Reliance Industries’ AGM, June quarter GDP data, and monthly derivatives expiring all on the agenda.

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All eyes on Reliance AGM; Jio, focused retail listing

This week is all about Reliance Industries, as the country’s most valuable company gears up for its much-anticipated annual shareholders meeting on Thursday. Although the meeting took place earlier than usual – blaming the lavish wedding in the Ambani family – expectations remained almost the same as last year. You can see the stock price of Reliance’s Corporation in US Dollars every year and every month. Sanford C. Bernstein expects the AGM to reveal potential listing dates for Mukesh Ambani’s consumer businesses, Jio and Reliance Retail, along with a timeline for the rollout of the company’s new energy projects.

Indian IPO market back outshine US, Europe

Returns from IPOs in India are surpassing those in the US, as investors flock to the country’s booming tech startups. This year, 195 companies have gone public, including notable offerings like E-scooter maker Ola Electric, and have returned an average of 58%. This gain was higher than the average of 12% for US IPOs and 18% for Europe, data compiled by Bloomberg showed. At least 20 other companies, including Hyundai Motor’s India unit, are poised to tap into the market’s ample liquidity. No wonder the BSE index of newly listed companies is up 33% this year, outstripping the 14% gain in the main Sensex.

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Birla’s paint entry could not disturb the top players

Birla Group’s venture into the paint industry initially put pressure on existing players, but market observers see room for new competitors. Nuvama Institutional Equities does not expect the entry of Grasim Industries to disrupt the market, which has led to an “anti-consensus” buying stance on the industry’s three major players. With the possibility of a rebound in price power and signs of rural demand growth, the sector looks to boost. Top player Asian Paints rose 8% in the quarter, after falling 14% in the first half.

Analyst actions:

• Bansal Wire Rated New Buy at Investec; PT 440 rupiah
• Devyani Cut is held at KR Choksey; PT 185 rupiah
• ITC Cut to Accumulate in KR Choksey; PT 545 rupiah
• Polycab India Cut hold on Systematix Shares & Shares

Three great reads from Bloomberg today:

• Inexpensive AI Voice Bot Launches With Businesses in India
• Powell’s Pivot Leaves Traders Debating Size, Path of Rate Cuts
• The Mpox Outbreak: How a Preventable Virus Became a Global Threat

And, finally..

The rally in government bonds looks set to extend as foreigners continue to issue the notes amid the prospect of interest rate cuts. The yield on the benchmark 10-year bond could fall to around 6.50% by March 2025, according to PGIM Mutual Fund, representing a decline of 36 basis points from Friday’s close. Securities, which recently joined JPMorgan Chase & Co. in size, are some of the best performers in Asia this year.

—With assistance from Malavika Kaur Makol.

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