Rupee plunged by 41 paise to close at a fresh lifetime low of 79.36 against the US dollar on Tuesday amid a strong greenback overseas and unrelenting foreign fund outflows. At the interbank forex market, the local unit opened at 79.04 against the greenback and witnessed an intra-day high of 79.02 and a low of 79.38. It finally settled at 79.36 (provisional), down 41 paise over its previous close. On Monday, the rupee had closed at 78.95 against the US dollar. The Indian rupee hit a fresh record low against the US Dollar on Tuesday on the back of stronger dollar and weaker-than-expected domestic data, said Anuj Choudhary – Research Analyst at Sharekhan by BNP Paribas. India’s merchandise exports in June rose by 16.78 per cent year-on-year to USD 37.94 billion while the trade deficit ballooned to a record USD 25.63 billion on account of a steep increase in gold and crude oil imports, according to the government’s preliminary data released on Monday. Rupee may trade in the range of 78.50-80 in the next couple of sessions.
It was a Tuesday trouble for Sense too. Benchmark BSE Sense on Tuesday gave up intra-day gains to close lower by a little over 100 points on emergence of fag-end selling in FMCG, banking and IT stocks and weak opening in European stock markets. The 30-share BSE index declined 100.42 points or 0.19 per cent to settle at 53,134.35. During the day, it jumped 631.16 points or 1.18 per cent to 53,865.93. The NSE Nifty also gave up intra-day gains and dipped 24.50 points or 0.15 per cent to 15,810.85. ITC, Wipro, Axis Bank, Mahindra & Mahindra, Larsen & Toubro, Maruti Suzuki India, IndusInd Bank and Asian Paints were among the major laggards in the Sense pack. Power Grid, Bajaj Finserv, Hindustan Unilever, Sun Pharma, Reliance Industries and Tata Steel were among the major gainers. Elsewhere in Asia, markets in Tokyo, Seoul and Hong Kong ended with gains, while Shanghai settled marginally lower. European bourses were trading in the negative territory in mid-session deals. The US markets were closed for a holiday on Monday.
Now some corporate news. The Enforcement Directorate on Tuesday conducted searches at 44 places across the country in a money laundering investigation against Chinese smartphone manufacturing company Vivo and related firms, officials said. The searches are being carried out under sections of the Prevention of Money Laundering Act (PMLA) at locations in several states including in Delhi, Uttar Pradesh, Meghalaya, Maharashtra and others. The agency is conducting searches at 44 places related to Vivo and associated companies, they said. The federal agency filed a money laundering case after taking cognisance of a recent Delhi Police (economic offences wing) FIR against a distributor of the agency based in Jammu and Kashmir where it was alleged that few Chinese shareholders in that company forged their identify documents. The ED suspects this alleged forgery was done to launder illegally generated funds using shell or paper companies and some of these “proceeds of crime” were diverted abroad or put in some other businesses by skirting Indian tax and enforcement agencies.
Moving on. The windfall taxes on domestic crude oil production and fuel exports will generate close to $12 billion (Rs 94,800 crore) for the government in the remainder of the current fiscal while trimming profits of firms such as Reliance Industries Ltd and ONGC, Moody’s Investors Service said Tuesday. On July 1, the government-imposed windfall gain taxes on the export of petrol, diesel and aviation turbine fuel, and on the domestic production of crude oil. It has also mandated exporters to meet the requirements of the domestic market first. “The tax increase will reduce the profits of Indian crude producers and oil exporters like Reliance Industries Limited (RIL) and Oil and Natural Gas Corporation Ltd (ONGC),” Moody’s said in its comments on the new taxes.
In other news, Twitter is seeking to overturn some Modi government orders to take down content on the social media platform, a Reuters report said. The US company’s attempt to get a judicial review is part of a growing confrontation with New Delhi. Twitter has been asked by Indian authorities over the past year to act on content including accounts supportive of an independent Sikh state, posts alleged to have spread misinformation about protests by farmers and over tweets critical of the government’s handling of the COVID-19 pandemic. India’s IT ministry did not immediately respond on Tuesday to a request for comment about Twitter’s legal move. The Indian government has previously said that big social media firms, including Twitter, have not complied with removal requests, despite their legal standing. Twitter complied this week, the source said, so as not to lose liability exemptions available as a host of content.
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