Morning buzz: Disinvestment target may fall short by 60 percent, rupee ends at record low as global bond yields surge, and more

With election approaching, the government may be forced to go slow on large disinvestment plans such as its stake sale in IDBI Bank. Image: Getty Images

Disinvestment target may fall short by 60 percent

With election approaching, the government may be forced to go slow on large disinvestment plans such as its stake sale in IDBI Bank. This could result in a shortfall of Rs 30,000 crore or 60 percent of the budget estimates for disinvestment of Rs 51,000 crore. This is unlikely to affect the budget maths as other sources of revenue have been strong. Meanwhile the Reserve Bank of India is continuing with its process of evaluating bidders for IDBI Bank.
(Financial Express)

Rupee ends at record low as global bond yields surge

The rupee ended at a record low of Rs 83.15 as the yield on the government 10-year benchmark bond rose to a four-month high. This follows the surge in global bond yields as the US Fed minutes suggested that inflation was still not under control and that the Fed may have to consider more rate hikes. The US 10-year yield went up to 4.31 percent. This also caused the Indian markets to slip as investors feared another round of rate hikes.
(Business Standard, Economic Times)

Foreign investors get interested in midcap stocks again

Midcap stocks, which saw a decline in interest of foreign investors over the last five years, are back in demand. Overseas investor holdings in midcap stocks saw an increase of 175 basis points to 16 percent, compared to a 250 basis points decline over the last 5 years. Smaller companies are attracting buyers even though they remain expensive relative to large companies. The Midcap Index has risen 20 percent this year compared to a gain of 7.4 percent in the Sensex.
(Business Standard)

Inflation to remain above 6 percent in second half of FY24: RBI

Retail inflation is expected to average over 6 percent in the second half of FY24, the RBI said in its State of the Economy Report. This is as the incidence of supply shocks is still not over. The article was written by RBI Deputy Governor Michael Patra and stated that it was not the view of the institution. The RBI, in its recent monetary policy meet, had raised the inflation forecast to 6.2 percent for Q3 and 5.7 percent for Q4.
(Indian Express, Business Standard)