RIL shares tumble, DLF zooms over record pre-sales & more

Nifty50: 16,985 ▲ 13 (+0.07%)
Sensex: 577,634 ▲ 78 (+0.1%)

Hi there!

Come 2030 you may have the chance to travel to space from India!

The Indian Space Research Organisation (ISRO) has set a timeline for its space tourism module. While the estimated cost of the trip is ₹6 crore per passenger, it is not yet clear whether tourists will only travel to the edge of space for a short stay or go beyond. 

Meanwhile, in the markets, bulls were engaged in a bruising battle with bears. Let us tell you why.

• The markets continue to remain volatile.
• Out of the Nifty50 universe, 32 stocks ended in the green.
• Mixed global cues weighed on the markets.

Among the Nifty sectoral indices, Media (+4.1%) and FMCG (+1.1%) were the top gainers, while Metal (-2.5%) and IT (-0.6%) were the top losers.

What’s trending

⭐ RIL shares hit fresh 52-week low 

Shares of Reliance Industries (-0.3%) ended in the red for the sixth consecutive trading session. The RIL stock is down over 4% this week. Experts believe that sell-off by foreign investors and market volatility could be impacting the shares. 

⭐ DLF zooms over record pre-sales  

The real estate developer (+4.5%) reported pre-launch sales worth ₹8,000 crore for its luxury high-rise project in Gurugram. It sold 1,137 luxury apartments within three days.

⭐ Patanjali Foods fails to meet norms

Shares of the consumer goods company (-3.0%) were locked in the lower circuit intraday. This comes after exchanges (NSE & BSE) froze the promoter entity’s shares over the failure to meet the minimum public shareholding (MPS) norms. According to the regulations, a listed entity should have a minimum public shareholding of 25%. However, currently, the public holding in Patanjali Foods is below 20%.

⭐Eris Lifesciences on acquisition spree

The pharma company (-1.3%) bought nine dermatology brands from Dr Reddy's Laboratories for ₹275 crore. The management of Eris has said that the deal will help the company to expand its product offerings in the cosmetic dermatology business.  

⭐ Oil rises from 15-month low

Oil prices regained some of their lost ground, rebounding from their 15-month low. The easing of the Credit Suisse crisis coupled with the improvement in economic sentiments in China aided the hopes of a revival in demand for oil.

In Focus

US Fed is caught in a catch-22 situation

Over the last one year, the US Fed has been aggressively battling inflation by hiking interest rates. And once again, its rate-setting committee will meet next week (21 and 22 March) for the rate decision. 

But, besides battling inflation, the US Fed also has to now take into account the contagious US banking crisis. This has put it in a catch-22 situation. Let’s understand how. 

Price rise woes

First let’s set the context. After the pandemic, the sharp revival in economic activities and supply constraints pushed up the inflation rate. To battle this, the US Fed has hiked rates by 4.50% since March 2022. Despite the rapid rate hikes, the inflation continues to remain stubborn. In February, the retail inflation rate in the US stood at 6%, which is way above the Fed’s target of 2%. 

The banking crisis

While these rate hikes were taken to contain inflation, they are one of the reasons for the banking crisis in the US. In the wake of rapid rate hikes, banks in the US have suffered losses on their investments in bonds. Here’s how: When rates increase, the interest rate or yield on new bonds go up. This means the price of existing bonds with lower interest rates declines or falls. Simply put, bonds have an inverse relationship with rates.

So, along with rising prices, the US Fed will also need to factor in the impact of its battle against inflation on the financial system. Keeping this in mind, experts believe that the Fed could slow down the pace of hikes. As the US banking crisis unravels, a lot rides on the upcoming US Fed meeting.

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Phrase of the day

Going Long

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