News Wrap | Sensex & Nifty Down; SBI Tanks; Fresh Allegations Vs SEBI Chief | September 6, 2024

Good evening, and welcome to Business Hook’s daily news podcast, where we bring you a roundup of the day’s top business stories. I’m Avni Raja, and today is the sixth of September 2024.

First, a quick roundup of Asian equities – most markets in Asia slipped on Friday as investors reacted to weaker-than-expected household spending growth in Japan. Household spending rose 0.1 per cent in July versus expectations of 1.2 per cent growth. This led to the Nikkei slipping three-fourths of a per cent. China’s Shanghai Composite was also down almost a per cent.

In India also, equity markets ended the week deep in the red. Both the Sensex and the Nifty slipped over a per cent each. The Sensex dropped more than 1,000 points to 81,000. The Nifty dropped below 24,900. The fall on Dalal Street was broad-based, with the Nifty Midcap Index and all sectoral indices also ending lower. Quantifying the loss, BSE-listed companies wiped out almost six lakh crore rupees of investor wealth on Friday.

In stock-specific action – India’s largest public sector bank, SBI, slipped more than four per cent on Friday. This came as Goldman Sachs gave a ‘Sell’ call on the lender, saying it anticipates several headwinds for SBI. The brokerage firm believes SBI’s return on assets has peaked and is likely to decline now. It also expects SBI’s loan growth to decelerate and credit costs to rise due to increased slippages. Therefore, the brokerage firm has reduced its target price for SBI shares to 742 rupees. With investors reacting to this news, SBI was the biggest Nifty loser on Friday.

On the regulatory front – Congress has levelled fresh allegations against SEBI Chairperson Madhabi Puri Buch. The party has now accused the SEBI chief of receiving rental income from Carol Info Services, a part of pharma major Wockhardt. According to Congress spokesperson Pawan Khera, this is an “out-and-out case of corruption” because the market regulator is investigating several cases against Wockhardt, which also include insider trading charges.

Meanwhile, the Public Accounts Committee of Parliament may summon the SEBI Chairperson as early as this month. The PAC, led by Congress leader KC Venugopal, has decided to review the performance of regulatory bodies, and Buch may be summoned as part of this exercise. Reports suggest the review was added to the panel’s agenda following calls for a probe into allegations against Buch.

Latest on semiconductor manufacturing in India – the Gautam Adani-led Adani Group has announced its foray into the sector. On Thursday, the Maharashtra government approved a 10-billion-dollar investment proposal by a joint venture of the Adani Group with Israel-headquartered Tower Semiconductor. The JV plans to set up a semiconductor chip manufacturing plant at Taloja in Maharashtra’s Panvel.

With that, it’s a wrap on this edition of the Business Hook News Wrap podcast. We will be back next week with more from the world of business and equities. You can also watch our in-depth coverage of big business stories on the Business Hook YouTube channel.