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Foreign investors have withdrawn nearly Rs 20,000 crore from Indian stock markets in just five trading days (November 4–8), continuing a trend of large-scale selling that began last month. Experts say investors are now moving their money to China, largely due to the high valuations presently prevailing in Indian markets. In early November, FPIs have offloaded as much as Rs 19,994 crore in Indian markets. The month prior, i.e., October, was one of the worst months in terms of foreign outflows, with FPIs making a net withdrawal of Rs 94,017 crore. Before this, Indian markets faced such a situation during the pandemic, when FPIs withdrew Rs 61,973 crore from equities in March 2020. <h2>Why Are Investors Leaving? </h2>According to Himanshu Srivastava of Morningstar Investment Research India, two main factors are driving this exodus. First is China's renewed appeal due to lower stock valuations and new economic stimulus measures. In a bid to nudge the domestic economy and bail state governments, China recently approved a 10-trillion yuan (US $1.4 trillion) package. Per reports, approximately 60% of this stimulus focuses on allowing local governments to refinance the mountain of debt on them. Srivastava explains foreign investors are also flocking to US dollar and Treasury yields, which have appreciated significantly in the recent past, leading FPIs to anticipate a stronger US economy going ahead. Moreover, high valuations in Indian markets are discouraging foreign investors from putting more money in the economy. As a result, over the past week, the selling pressure eroded Rs 74,563 crore in market value for Reliance Industries, while Bharti Airtel and ICICI Bank lost Rs 26,274 crore and Rs 22,254 crore, respectively. The combined market valuation of six of the top 10 most-valued firms dipped by Rs 1,55,721.12 crore last week. <h2> Silver linings</h2>Despite the ongoing outflux of funds since last month, November also saw unprecedented applications of about 40–50 new FPI registrations, which are eyeing to enter the Indian market. This was due to markets SEBIs recent relaxation to NRIs, permitting them to participate up to 100% and announcing measures for ease of entry and operations in India. On the other hand, FPIs invested Rs 599 crore in the debt general limit and Rs 2,896 crore in the debt voluntary retention route (VRR) during the period under review. So far this year, FPIs have invested Rs 1.06 lakh crore in the debt market. <li class="whitespace-normal break-words"></li>Going ahead, investors will be looking for certain macroeconomic cues, which include corporate earnings reports, India's inflation (CPI) and industrial production (IIP) data on November 12, the US inflation report on November 13, and wholesale price index (WPI) data on November 14.

FPIs withdraw nearly Rs 20,000 crore from equities in the last 5 trading sessions, make a beeline for China and US

India's GDP growth is projected at 7.2 per cent in 2024-25, around 7 per cent in the next fiscal, and after that, there is a strong likelihood that the growth will revert to the 8 per cent trend, said <keyword id="19899810" type="General" weightage="20" keywordseo="Reserve-Bank-of-India" source="keywords" meta.keywordsubtype="org" meta.entityname="Reserve Bank of India" meta.hostid="261" meta.entityid="Reserve Bank of India">Reserve Bank of India</keyword> deputy governor <keyword id="20244361" type="General" weightage="20" keywordseo="Michael-Debabrata-Patra" source="keywords">Michael Debabrata Patra</keyword>. He was speaking at the New York Fed Central Banking Seminar organised by the <keyword id="20238413" type="General" weightage="20" keywordseo="Federal-Reserve-Bank" source="keywords" meta.keywordsubtype="org" meta.entityname="Federal Reserve Bank" meta.hostid="261" meta.entityid="Federal Reserve Bank">Federal Reserve Bank</keyword> here on Monday. "...I do believe with all the strength of my conviction that India's time has come," he said, and highlighted the country heads into its future with the youngest population in the world with a median age of 28 years. Unlike in many parts of the world, the working age population is growing -- every sixth working age person is an Indian. Patra said that since independence in 1947, India's growth path has undergone three structural shifts with trend growth, having risen to 7 per cent during 2002-2019. After the severe contraction during the pandemic, a new growth trajectory averaging 8 per cent seems to be forming during 2021-24, he said. India is now regarded as the fastest growing major economy in the world. Already the fifth largest economy in terms of market exchange rates, it is poised to become the third largest economy by 2030, the senior RBI official said and added the country is already the third largest economy in terms of <keyword id="20776921" type="General" weightage="20" keywordseo="purchasing-power-parity" source="keywords">purchasing power parity</keyword>. "Our projections show that India's <keyword id="21013593" type="General" weightage="20" keywordseo="real-GDP-growth" source="keywords">real GDP growth</keyword> will be 7.2 per cent in 2024-25 and around 7.0 per cent in 2025-26 in a cyclical correction to the rebound from the pandemic. Thereafter, there is a strong likelihood that India's growth will revert to the 8 per cent trend," Patra said. On inflation, he said it is projected to average 4.5 per cent in 2024-25 and 4.1 per cent in 2025-26. Consumer Price Index (CPI) based inflation fell below target during July-August but rose to 5.5 per cent in September on the back of a pickup in price momentum in some food items and adverse base effects inherent in year-on-year measurement. "Our projection indicates that these price pressures will persist in October and November before headline inflation realigns with the target from December 2024 and remains aligned in 2025-26," the deputy governor said. He also emphasised that India is emerging as a world leader in leveraging <keyword id="20181895" type="General" weightage="20" keywordseo="digital-technologies" source="keywords">digital technologies</keyword> for transformative change.

India likely to grow at 7.2% in FY25, says RBI deputy governor

<ul class="summary-list"><li>Warner Bros. Discovery Inc. CEO David Zaslav earned $49.7 million in 2023.</li><li>Zaslav's compensation increased despite actors' and writers' strikes, topping his 2022 earnings.</li></ul>In a year when thousands of writers and actors were fighting for higher paychecks, one media mogul earned big.The CEO of Warner Bros. Discovery Inc., <a target="_blank" href="https://www.businessinsider.com/warner-bros-discovery-merger-compete-netflix-disney-streaming-david-zaslav">David Zaslav</a>, raked in a pay package worth $49.7 million in 2023, according to a regulatory filing released Friday.Despite both <a target="_blank" href="https://www.businessinsider.com/why-sag-aftra-actors-wga-writers-unions-strike-hollywood">the actors' and writers' strikes</a> that lasted nearly 4 and 5 months respectively, Zaslav's pay for the year went up.In 2023, his total compensation increased 26.5% from the year prior. It included $3 million in base pay, combined with more than $23 million in stock awards and a $22 million cash bonus, along with $1.6 in additional compensation, the filing shows.But Zaslav's compensation in 2022 and 2023 is still modest compared to what he earned in 2021, when he was in charge of Discovery Inc. before its merger with WarnerMedia. That year, his pay package topped nearly $246.6 million.At the same time, Warner Bros. as a company lost money for the year despite generating about $1 billion more profit than expected, thanks to costs saved from TV and film production being halted during the strikes, <a target="_blank" href="https://www.wsj.com/business/media/warner-bros-discovery-lost-money-last-year-its-ceo-got-a-50-million-payday-0bf00bda">The Wall Street Journal reported</a>.Meanwhile, thousands of striking actors and writers went without a paycheck as they <a target="_blank" href="https://www.businessinsider.com/hollywood-writers-strike-jobless-careers-young-graduates-food-stamps-layoffs-2023-6">struggled to pay the bills</a> and fought back against an <a target="_blank" href="https://www.businessinsider.com/actors-revealing-how-little-money-make-sag-aftra-strike-2023-7#matt-mcgorry-who-also-starred-in-orange-is-the-new-black-also-said-he-had-to-have-a-day-job-while-filming-the-show-3">industry that barely trickled the profits down</a> to them.

Warner Bros.' boss made bank last year, despite the Hollywood strikes      

<div type="image" title="Are Indians depositing less money in banks, or more in mutual funds? Turns out, it&amp;#39;s neither of those." msid="113663806" hostid="261" sizebytes="1121785"></div> Over the past few months, there’s been a lot of brouhaha about the lagging pace of <keyword id="20202062" type="General" weightage="20" keywordseo="bank-deposits" source="keywords">bank deposits</keyword> in India. Simply put, the rate at which Indians are depositing their hard-earned money in banks has been falling constantly, and some blame the increasing financialisation of <keyword id="20751315" type="General" weightage="20" keywordseo="household-savings" source="keywords">household savings</keyword> in the country or the rising preference of Indians towards <keyword id="19929240" type="General" weightage="20" keywordseo="mutual-funds" source="keywords">mutual funds</keyword> and shares. So, the hypothesis is that people are choosing to invest more in mutual funds and the Indian <keyword id="19949641" type="General" weightage="20" keywordseo="equity-markets" source="keywords">equity markets</keyword> through direct investments, IPOs, or NFOs, the money flowing into Indian banks in the form of deposits is slowing down. But is that really the case? <h2>A crisis or a phase?</h2><keyword id="19899808" type="General" weightage="20" keywordseo="RBI" source="keywords" meta.keywordsubtype="org" meta.entityname="RBI" meta.hostid="261" meta.entityid="RBI">RBI</keyword> data suggested that for the quarter ended June 2024, bank deposits grew at 11.7%. On the other hand, credit growth has outpaced this at 15%. This means that the outflow from banks as loans is far greater than the inflow into them in the form of deposits in Q1 of FY 2024-25. The situation largely saw cut-copy-paste in the first week of September as well, with loans registering a 13.3% YoY growth during the period, while deposits rose only 11.1%. This gap has only been widening for the last 3 years. Since deposits are how banks gather assets to further lend and earn interest income as a consequence, even a slight dip could set the alarm bells ringing for banks, and rightfully so. And truth be told, mutual funds are indeed taking on bank deposits in a big way. Per a report by Franklin Templeton, in August 2024, the AUM (assets under management) of Indian mutual funds, or the total funds managed by them, stood at 31.3% of total bank deposits in the country, up from 24.20% during the year-ago period. As of August 2024, the AUM of mutual funds stood at Rs 66.17 lakh crore, an all-time high. But all said and done, is this really the reason why the rate of bank deposits is falling behind? SBI has dismissed this to be a “statistical myth”, and experts point out that since equity and fund houses also keep the cash in their respective bank accounts, there’s no cause for concern. So, is financialization really to be blamed for the trailing tempo of deposits? Or is something else happening behind the scenes? We take a closer look: <h2>First, are household deposits really slowing down? And is that a cause of concern?</h2>Data from Motilal Oswal suggests the contrary. Deposits grew by around 10.4% between March 2020 and August 2024. Data from RBI also highlights that as of August 9, 2024, bank deposits witnessed a YoY growth of 10.8%. The loan-to-deposit ratio for the retail segment, which indicates what percentage of its total deposits the banks lend out as loans, has stayed at 77.5%, above the 77% mark for the tenth straight month. <div type="image" title="Yes, household deposits (as % of total deposits) have dipped, but the drop is far from significant" msid="113663882" hostid="261" sizebytes="306706"></div> Also, we can’t forego the fact that the share of Indian households in bank deposits has indeed slowed down. However, data from Axis AMC shows that the dip is marginal—from 63% in 2022 to 62% in 2023 and 61% in 2024. What has slowed down even more considerably is the share of government deposits in the aggregate bank deposits, which has dipped from 14% in 2018 to 9% in 2024. So, it's not just household deposits, you see. Moreover, as of March 2024, the collective CASA ratio (current and <keyword id="114757" type="General" weightage="20" keywordseo="savings-account" source="Orion">savings account</keyword> deposits) of all commercial banks in India stood at 41.00%, down from 43.1% in March 2023 and 45.2% in March 2022, marking a nearly 5% point decline over the past year, while still staying over the 10-year average of 39.2%. This implies that Indian banks are relying more on higher-cost funds (savings accounts), which can limit their profitability. <h2>What is this financialisation of savings we are talking about?</h2>Then again, there is no doubt about the growing affinity of Indians towards mutual funds and stock markets. Recent data from CBDT (Central Board of Direct Taxes) highlights that India’s net direct tax collection surged by around 22%, driven exclusively by the significant uptick in the collection of Securities Transaction Tax (STT), which doubled to Rs 26,154 crore, from Rs 13,352 crore in the year-ago period. Why does this matter? STT is levied when you buy or sell equity shares on stock exchanges, sell <keyword id="6361918" type="General" weightage="20" keywordseo="equity-mutual-funds" source="Orion">equity mutual funds</keyword>, and trade in futures and options in the equity segment. Such taxes, including the multiple other taxes in equity market investments, are considered as leakages as the money moves out of the economy into government coffers. Data from a ValueQuest report explains that over the last 20 years, the markets have handsomely rewarded the investors, generating over $900 billion in incremental value for them. This is the major driver behind the dramatic rise in investment flowing towards the equity markets. There’s further proof of this budding romance, if you check the demat pudding. The number of demat accounts, which are a primary requisite for participating in the stock markets, also burgeoned by 42.3 lakh in August 2024, taking India’s total tally of demat accounts beyond 17 crore. To put this in perspective, this is almost equivalent to the population of just 8 nations in the world, including China, the US, Brazil and more. Vivek Iyer, Partner, Grant Thornton Bharat thinks it's rather important, as well. “Financialisation of household savings in India is an indication of deepening capital markets in the market, especially from a retail investor standpoint. Bank deposits with a modest rate of return are no longer the only option for savings for investors. Investors today have more avenues for wealth creation in the form of public capital markets, which have democratized wealth creation and provided equality of opportunity to retail investors”, he says. Yes, Indians are investing more and more in the markets, and in mutual funds. But is it a sin to look out for inflation-beating returns, which the stock markets offer, and vanilla bank deposits don't? After all, the allure of 12-13% annual returns offered by <keyword id="45369" type="General" weightage="20" keywordseo="equities" source="Orion">equities</keyword> can certainly pale the stability offered by good old deposits, which generally do not go beyond 9% when it comes to annual returns. But all of this is not what is behind the slowdown. India is still a toddler in the school of savings financialization, with less than 10% of the population holding a demat account, and less than 5% of us saving in equities. That's a drop in the ocean of deposits, far inadequate to trigger a tsunami. <h2>Tell me why lagging deposits have nothing to do with Indians investing more in mutual funds!</h2>Says Shweta Rajani, Head - Mutual Funds, Anand Rathi Wealth Limited, “Households' equity holdings composition grew from 11.1% in FY 23 to 14.7% in FY 24. This trend reflects a growing awareness of investment options, empowering individuals to take control of their financial futures. Despite this transition towards equities, banks still hold a significant share of household financial savings—33.5% in FY24 compared to 34.9% in FY23”. Also, household savings and their subsequent financialization do not have much to do with deposit creation, which is entirely made by banks. What actually drives increased deposits is credit growth or increased lending. When interest rates are eased, people tend to borrow more and spend more, which circulates more money in the economy. For the past 4 years, RBI has been tightening the screws on interest rates, which raises the cost of borrowings, and makes it more expensive to take loans, putting a dampener on credit growth, but effectively curbing inflationary pressures. The last time RBI cut the repo rate by 40 basis points was back in May 2020, 4 years ago. The lag in <keyword id="19998084" type="General" weightage="100" keywordseo="deposit-growth" source="keywords">deposit growth</keyword> we’re witnessing is almost 3 years old. Coincidence much, or just good old economics at work? But with the Fed recently setting a rate cut precedent by slashing 50 bps off its interest rate, RBI is expected to follow suit in the next MPC (Monetary Policy Committee) meeting, scheduled for November 2024. A rate cut would ease the aforementioned high cost of borrowing, and increase loan-taking for corporates and institutional investors, thereby stoking consumption in the economy. And then, deposit creation in banks is likely to return to its former glory. If not, then that would be a curious case to unravel! But that worry is for another day. Do you have insights or personal experience to share on your personal finances or money? Contact us at <a target="_blank" class="c-link" href="mailto:businessinsider@timesinternet.in">businessinsider@timesinternet.in</a>.

Simply Put: A Deposit Dilemma — What's the fuss about a crisis in Indian bank deposits? Are mutual fund investments to blame?

New Delhi, The <keyword id="19895345" type="General" weightage="20" keywordseo="supreme-court" source="keywords">Supreme Court</keyword> on Thursday struck down the electoral bond scheme, saying it violates the right to information and the freedom of speech and expression under the Constitution. In a landmark judgement that will have wide ramifications, it ordered the <keyword id="19934368" type="General" weightage="20" keywordseo="state-bank-of-india" source="keywords">State Bank of India</keyword> to disclose to the <keyword id="19895782" type="General" weightage="20" keywordseo="election-commission" source="keywords">Election Commission</keyword> the names of the contributors to the six-year-old scheme. A five-judge Constitution bench headed by Chief Justice <keyword id="19936357" type="General" weightage="20" keywordseo="d-y-chandrachud" source="keywords">D Y Chandrachud</keyword> delivered two separate and unanimous verdicts on the pleas challenging the scheme, delivering a major blow to the central government. Pronouncing the verdict, the CJI said the scheme is violative of freedom of speech and expression under Article 19(1)(a) of Constitution. The bench said the fundamental right to privacy also includes citizens' right to political privacy and affiliation. It also held as invalid the amendments made in various laws, including the <keyword id="20592932" type="General" weightage="20" keywordseo="representation-of-peoples-act" source="keywords">Representation of Peoples Act</keyword> and the Income Tax laws. It directed that the issuing bank shall stop issuance of electoral bonds and the State Bank of India shall submit details of electoral bonds purchased since April 12, 2019 till date to the Election Commission. The top court had on November 2 last year reserved its verdict in the matter. The scheme, which was notified by the government on January 2, 2018, was pitched as an alternative to cash donations made to political parties as part of efforts to bring transparency in political funding. According to the provisions of the scheme, electoral bonds may be purchased by any citizen of India or entity incorporated or established in the country. An individual can buy electoral bonds, either singly or jointly with other individuals without disclosing the identity. Critics have said this eliminates transparency in electoral funding and gives an edge to the ruling parties.

SC strikes down electoral bond scheme, terms it unconstitutional

<ul class="summary-list"><li>Nvidia stock has slid since late March, correcting by over 10% from all-time highs. </li><li>BofA analysts say there's nothing to worry about, and the company will still dominate in the AI chip space. </li></ul><a href="https://markets.businessinsider.com/stocks/nvda-stock">Nvidia</a> stock has tumbled recently, with the share price correcting by more than 10% from the latest all-time high, but Bank of America is telling investors not to worry about the recent slide as the chip titan is still in prime position to dominate. BofA analysts led by Vivek Arya said in a note Wednesday that despite the 11% plunge since late March, they remain bullish on Nvidia and predict the company will hold onto its top spot as the industry's leading producer of the chips that power the booming artificial intelligence space.The analysts note that the latest rout is the ninth time the stock has fallen more than 10% since ChatGPT debuted in November of 2022. The bank maintained its price target of $1,100 per share, representing upside of 26% from where the stock was trading during Wednesday's session. Shares changed hands at $867.62 around 12:45 p.m. Wednesday. "While there is always the potential for near-term summer consolidation in NVDA stock (such as we saw from Aug-Dec last year), we believe the fundamentals are solidly on track and periods of consolidation (trading sideways) tend to set the stock up for strong moves later," analysts wrote in the note. They add that Nvidia's recent stock decline can be attributed to numerous factors such as inflation picking back up, rising competition from other chip makers, market volatility, AI stock fatigue, a rotation toward cyclical sectors, and potential pruning of some positions ahead of earnings season. Yet, these factors haven't shifted the narrative for the firm. Nvidia's latest <a href="https://www.businessinsider.com/nvidia-new-blackwell-chip-cost-30000-to-40000-jensen-huang-2024-3">Blackwell chip</a> offers a fivefold AI performance boost, which aims to cut AI inference costs and energy use by up to 25 times. This, combined with Nvidia's strong enterprise foothold, makes the BofA analysts more confident in the company's ability to maintain and gain market share in the chip space. While Nvidia faces competition from Google and Intel, the bank believes their processors pose limited threat to Nvidia's dominance.<a href="https://markets.businessinsider.com/stocks/goog-stock">Google</a> just announced its <a href="https://www.businessinsider.com/google-ramped-up-ai-competition-against-microsoft-amazon-2024-4">ARM-based server CPU, Axion</a>, while Nvidia has its own called Grace. However, since Nvidia doesn't sell their CPUs to Google, the bank said Google's new launch has no impact on Nvidia. Meanwhile, <a href="https://markets.businessinsider.com/stocks/intc-stock">Intel</a> also unveiled its <a href="https://markets.businessinsider.com/news/stocks/nvidia-stock-price-ai-chip-competition-heats-up-intel-alphabet-2024-4">Gaudi 3 accelerator this week</a>, which it says will boast 50% better inference performance compared to Nvidia's two-year-old H100 chip. However, Bank of America expects Gaudi 3 to capture less than 1% of the AI accelerator market share.

Don't sweat Nvidia's recent sell-off as the stock still has 26% upside, Bank of America says

Over the past few months, there’s been a lot of brouhaha about the lagging pace of bank deposits in India. Simply put, the rate at which Indians are depositing their hard-earned money in banks has been falling constantly, and some blame the increasing financialization of household savings in the country, or the rising preference of Indians towards mutual funds and shares. So, the hypothesis is that people are choosing to invest more in mutual funds and the Indian equity markets through direct investments, IPOs, or NFOs, the money flowing into Indian banks in the form of deposits is slowing down. But is that really the case? <h2>A crisis or a phase?</h2><keyword id="19899808" type="General" weightage="20" keywordseo="rbi" source="keywords">RBI</keyword> data suggested that for the quarter ended June 2024, bank deposits grew at 11.7%. On the other hand, credit growth has outpaced this at 15%. This means that the outflow from banks as loans is far greater than the inflow into them in the form of deposits in Q1 of FY 2024-25. The situation largely saw cut-copy-paste in the first week of September as well, with loans registering a 13.3% YoY growth during the period, while deposits rose only 11.1%. This gap has only been widening for the last 3 years. Since deposits are how banks gather assets to further lend and earn interest income as a consequence, even a slight dip could set the alarm bells ringing for banks, and rightfully so. And truth be told, mutual funds are indeed taking on bank deposits in a big way. Per a report by <keyword id="20250971" type="General" weightage="20" keywordseo="franklin-templeton" source="keywords">Franklin Templeton</keyword>, in August 2024, the AUM (assets under management) of Indian mutual funds, or the total funds managed by them, stood at 31.3% of total bank deposits in the country, up from 24.20% during the year-ago period. As of August 2024, the AUM of mutual funds stood at Rs 66.17 lakh crore, an all-time high. But all said and done, is this really the reason why the rate of bank deposits is falling behind? SBI has dismissed this to be a “statistical myth”, and experts point out that since equity and fund houses also keep the cash in their respective bank accounts, there’s no cause for concern. So, is financialization really to be blamed for the trailing tempo of deposits? Or is something else happening behind the scenes? We take a closer look: <h2>First, are <keyword id="4000333" type="General" weightage="100" keywordseo="household-deposits" source="Orion">household deposits</keyword> really slowing down? And is that a cause of concern?</h2>Data from Motilal Oswal suggests the contrary. Deposits grew by around 10.4% between March 2020 and August 2024. Data from RBI also highlights that as of August 9, 2024, bank deposits witnessed a YoY growth of 10.8%. The loan-to-deposit ratio for the retail segment, which indicates what percentage of its total deposits the banks lend out as loans, has stayed at 77.5%, above the 77% mark for the tenth straight month. Also, we can’t forego the fact that the share of Indian <keyword id="20319599" type="General" weightage="20" keywordseo="households" source="keywords">households</keyword> in bank deposits has indeed slowed down. However, data from Axis AMC shows that the dip is marginal—from 63% in 2022 to 62% in 2023 and 61% in 2024. What has slowed down even more considerably is the share of government deposits in the aggregate bank deposits, which has dipped from 14% in 2018 to 9% in 2024. So, it's not just household deposits, you see. Moreover, as of March 2024, the collective CASA ratio (current and savings account deposits) of all commercial banks in India stood at 41.00%, down from 43.1% in March 2023 and 45.2% in March 2022, marking a nearly 5% point decline over the past year, while still staying over the 10-year average of 39.2%. This implies that Indian banks are relying more on higher-cost funds (savings accounts), which can limit their profitability. <h2>What is this financialisation of savings we are talking about?</h2>Then again, there is no doubt about the growing affinity of Indians towards mutual funds and stock markets. Recent data from CBDT (<keyword id="19942037" type="General" weightage="20" keywordseo="central-board-of-direct-taxes" source="keywords">Central Board of Direct Taxes</keyword>) highlights that India’s net direct tax collection surged by around 22%, driven exclusively by the significant uptick in the collection of <keyword id="20930760" type="General" weightage="20" keywordseo="securities-transaction-tax" source="keywords">Securities Transaction Tax</keyword> (STT), which doubled to Rs 26,154 crore, from Rs 13,352 crore in the year-ago period. Why does this matter? STT is levied when you buy or sell equity shares on stock exchanges, sell equity mutual funds, and trade in futures and options in the equity segment. Such taxes, including the multiple other taxes in equity market investments, are considered as leakages as the money moves out of the economy into government coffers. Data from a ValueQuest report explains that over the last 20 years, the markets have handsomely rewarded the investors, generating over $900 billion in incremental value for them. This is the major driver behind the dramatic rise in investment flowing towards the equity markets. There’s further proof of this budding romance, if you check the demat pudding. The number of demat accounts, which are a primary requisite for participating in the stock markets, also burgeoned by 42.3 lakh in August 2024, taking India’s total tally of demat accounts beyond 17 crore. To put this in perspective, this is almost equivalent to the population of just 8 nations in the world, including China, the US, Brazil and more. Vivek Iyer, Partner, Grant Thornton Bharat thinks it's rather important, as well. “Financialisation of household savings in India is an indication of deepening capital markets in the market, especially from a retail investor standpoint. Bank deposits with a modest rate of return are no longer the only option for savings for investors. Investors today have more avenues for wealth creation in the form of public capital markets, which have democratized wealth creation and provided equality of opportunity to retail investors”, he says. Yes, Indians are investing more and more in the markets, and in mutual funds. But is it a sin to look out for inflation-beating returns, which the stock markets offer, and vanilla bank deposits don't? After all, the allure of 12-13% annual returns offered by equities can certainly pale the stability offered by good old deposits, which generally do not go beyond 9% when it comes to annual returns. But all of this is not what is behind the slowdown. India is still a toddler in the school of savings financialization, with less than 10% of the population holding a demat account, and less than 5% of us saving in equities. That's a drop in the ocean of deposits, far inadequate to trigger a tsunami. <h2>Tell me why lagging deposits have nothing to do with Indians investing more in mutual funds!</h2>Says Shweta Rajani, Head - Mutual Funds, Anand Rathi Wealth Limited, “Households' equity holdings composition grew from 11.1% in FY 23 to 14.7% in FY 24. This trend reflects a growing awareness of investment options, empowering individuals to take control of their financial futures. Despite this transition towards equities, banks still hold a significant share of household financial savings—33.5% in FY24 compared to 34.9% in FY23”. Also, household savings and their subsequent financialization do not have much to do with deposit creation, which is entirely made by banks. What actually drives increased deposits is credit growth or increased lending. When interest rates are eased, people tend to borrow more and spend more, which circulates more money in the economy. For the past 4 years, RBI has been tightening the screws on interest rates, which raises the cost of borrowings, and makes it more expensive to take loans, putting a dampener on credit growth, but effectively curbing inflationary pressures. The last time RBI cut the repo rate by 40 basis points was back in May 2020, 4 years ago. The lag in deposit growth we’re witnessing is almost 3 years old. Coincidence much, or just good old economics at work? But with the <keyword id="19900043" type="General" weightage="20" keywordseo="fed" source="keywords">Fed</keyword> recently setting a rate cut precedent by slashing 50 bps off its interest rate, RBI is expected to follow suit in the next <keyword id="19918491" type="General" weightage="20" keywordseo="mpc" source="keywords">MPC</keyword> (Monetary Policy Committee) meeting, scheduled for November 2024. A rate cut would ease the aforementioned high cost of borrowing, and increase loan-taking for corporates and institutional investors, thereby stoking consumption in the economy. And then, deposit creation in banks is likely to return to its former glory. If not, then that would be a curious case to unravel! But that worry is for another day.

A Deposit Dilemma — What's the fuss about a crisis in Indian bank deposits? Are mutual fund investments to blame?

<ul class="summary-list"><li>Autry Stephens sold his oil company for $26 billion but died before the deal was completed.</li><li>The Texan farm boy became an oil tycoon by betting big, minimizing costs, and working tirelessly.</li></ul>Autry Stephens spent 45 years building one of the nation's largest private oil producers and finally agreed to sell it for $26 billion this year — but <a target="_blank" class="" href="https://www.businessinsider.com/oil-deals-autry-stephens-endeavor-diamondback-energy-billionaires-rich-list-2024-8">died before the deal closed</a>.The Texas farm boy became an oil tycoon by taking big risks, pinching pennies, hustling hard, and finding ways to survive when others failed. Here's the story of his life and his last big deal.<h2 id="36c5efde-9e9d-4363-a20b-58af577cef02">Drilling down</h2>Stephens was born in 1938, raised on a fruit-and-peanut farm in the Texas town of DeLeon, and studied petroleum engineering at the University of Texas at Austin's engineering school, according to a profile on its website.His first job after graduating was at Humble Oil, an ExxonMobil predecessor. He promptly took two years out to join the US Army Corps of Engineers as a lieutenant and platoon leader in charge of installing pipelines before rejoining Humble for five years.His next gig was as an appraisal engineer for a bank in Midland, Texas. Next, he struck out on his own as an independent consulting engineer.Stephens was in his forties by the time he drilled his first well in 1979. He plowed his life savings into the prospect, which "wasn't very smart," he told The Wall Street Journal in February.Over the next 45 years the <a target="_blank" class="" href="https://www.businessinsider.com/rise-fall-of-energy-titan-aubrey-mcclendon-2016-3">wildcatter</a> established Big Dog Drilling Company, which had a single rig at first, and then Endeavor Energy Resources. He built his business into one of the biggest oil exploration and production companies in the <a target="_blank" class="" href="https://www.businessinsider.com/us-oil-production-boom-crude-supply-wti-price-goldman-sachs-2024-7">Permian Basin</a> of West Texas and New Mexico.Endeavor now owns 410,000 net acres across multiple basins, boasts thousands of wells, and produces more than 420,000 gross operated barrels of oil equivalent per day, according to its website.<h2 id="aa67b277-e6a4-4fa5-b4a7-93fd25904d00">Striking oil</h2>Stephens competed with the oil majors as an underdog, purchasing wells they deemed too costly to bring online. He drove down costs by drilling one well at a time, and <a target="_blank" class="" href="https://www.businessinsider.com/learn-from-elon-musk-vertical-integration-leadership-spacex-tesla">buying or setting up</a> his own fracking, trucking, construction, and oil services companies.When rivals faltered during industry downturns, Stephens bought cheap mineral rights and acquired businesses for his stable. He stayed afloat when crude prices plunged in <a target="_blank" class="" href="https://www.businessinsider.com/2008/9/oil-to-91-as-global-economy-collapses">2008</a> and <a target="_blank" class="" href="https://www.businessinsider.com/oil-drops-to-five-year-low-2014-12">2014</a> by shutting down his rigs, flogging assets, and securing new lenders, per the Journal. He also issued long-term bonds and stabilized the selling prices for his oil using futures contracts, per Bloomberg.Endeavor has been riding high on the <a target="_blank" class="" href="https://markets.businessinsider.com/news/commodities/us-oil-production-outlook-opec-cuts-saudi-arabia-flood-market-2023-12">US shale wave</a> since 2016, when it shifted its focus to fracking and horizontal drilling. Stephens told the Journal that he'd been fending off buyout offers from ExxonMobil and Shell for years.He finally accepted a $26 billion deal for Endeavor from Diamondback Energy in February. One big reason was that he'd been diagnosed with cancer, and the disease was taking a physical toll on him, he told the Journal.<h2 id="b62e82ef-8d34-46c7-8e7e-b3a8b1bf3940">Work hard, spend little</h2>Stephens was renowned for his zealous <a target="_blank" class="" href="https://www.businessinsider.com/personal-finance/good-worth-ethic-working-class-2022-7">work ethic</a>. The Journal reported that he often went to Endeavor's offices at weekends, and marched up and down the staircases for exercise.He also took a leaf out of Warren Buffett's <a target="_blank" class="" href="https://www.businessinsider.com/how-warren-buffett-spends-money-net-worth">frugal billionaire</a> playbook. He flew cheaply with <a target="_blank" class="" href="https://www.businessinsider.com/southwest-airlines-history-2021-8">Southwest Airlines</a>, drove a <a target="_blank" class="" href="https://www.businessinsider.com/warren-buffett-cadillac-car-upgrade-gm-barra-berkshire-hathaway-police-2024-3">beaten-up</a> Toyota Land Cruiser, and didn't take any money out of Endeavor for many years, sources told the Journal.Stephens also kept a low profile. One of his few moments in the spotlight was on a truTV documentary called "Black Gold," which followed workers on one of his rigs as they scrambled to complete four wells in 50 days.<h2 id="cb02d0f0-d63c-4642-9b75-a912624e83d2">Missing out</h2>Diamondback is <a target="_blank" class="" href="https://www.businessinsider.com/endeavor-energy-autry-stephens-net-worth-career">set to buy</a> Endeavor for $8 billion in cash and 117 million shares.The merger promised to quadruple Stephens' net worth to more than $23 billion on paper, vaulting him to 85th place on the Bloomberg Billionaires Index and making him America's wealthiest oilman.Stephens has now been removed from the rich list following his death on August 16 at the age of 86. He was previously listed as gaining some $17 billion this year — more than <a target="_blank" class="" href="https://www.businessinsider.com/elon-musk">Elon Musk</a> (up $4.2 billion), Microsoft's <a target="_blank" class="" href="https://www.businessinsider.com/how-former-microsoft-ceo-steve-ballmer-spends-fortune-2024-7">Steve Ballmer</a> (up $11.8 billion), and Asia's richest person, <a target="_blank" class="" href="https://www.businessinsider.com/ambani-richest-family-in-asia-india-lifestyle-home-wedding-photos-2018-12">Mukesh Ambani</a> (up $16 billion).The wildcatter died shortly before the deal's expected fourth-quarter close. But given Stephens' disinterest in living large, it's unlikely he felt bitter about missing out. His family is set to receive the payment instead.Stephens told the Journal in February he had "mixed emotions" about selling the company he'd built over more than four decades. He viewed his workforce as a "kind of a little family" and would miss them.

Autry Stephens sold his company for $26 billion but died before the deal was done. Here's how a Texas farm boy became an oil tycoon.

<ul class="summary-list"><li>Stocks rose Tuesday, with the S&amp;P 500 closing at an all-time high above 5,500.</li><li>Dovish comments from Fed Chairman Jerome Powell helped propel stocks higher.</li></ul>US stocks jumped Tuesday on encouraging remarks from Federal Reserve Chairman Jerome Powell, which sent the <a target="_blank" href="https://markets.businessinsider.com/index/s&amp;p_500">S&amp;P 500</a> to an all-time high.The benchmark index closed above 5,500 for the first time. Bond yields dropped. The 10-year Treasury yield tumbled four basis points to 4.432%."We've made quite a bit of progress in bringing inflation back down to our target," Powell acknowledged at a central bank forum in Portugal.However, he reiterated that more confidence is needed that inflation will return to the Fed's 2% goal.The dovish commentary came alongside softening job openings data. According to Tuesday's JOLTS report, there were 8.14 million job openings in May, while the openings-to-unemployed ratio matched pre-pandemic metrics."Overall, job openings in higher paying roles are moderating as the labor market has early signs of cooling," LPL Financial chief economist Jeffrey Roach said. " As long as the job market is stable, the soft landing narrative appears likely as consumers will have some capacity to spend."Investors have been eager to see a moderate softening of jobs data, as it would allow the Fed more wiggle room to cut interest rates.Despite Powell's commentary, policy expectations were little changes among futures markets: investors are pricing in rate cuts to start in November.<a target="_blank" href="https://markets.businessinsider.com/stocks/tsla-stock">Tesla</a> boosted the S&amp;P 500's rally in the session as the electric vehicle maker posted better-than-expected deliveries for the second-quarter. <a target="_blank" href="https://markets.businessinsider.com/news/stocks/tesla-stock-price-reaction-q2-deliveries-china-robotaxi-dan-ives-2024-7">The stock spiked 10% on Tuesday</a>.The company reported 442,956 vehicle deliveries in the second quarter, an annual slump of 4.8% but higher than the 439,000 expected by analysts.Nvidia meanwhile fell 1.3% extending a rough patch for the stock that started last month, shortly after its dizzying rise to briefly capture the title of the world's most valuable company.Here's where US indexes stood at the 4:00 p.m. closing bell on Tuesday:<ul><li><a target="_blank" href="https://markets.businessinsider.com/index/s&amp;p_500?utm_source=markets&amp;utm_medium=ingest%3Futm_source%3Dmarkets&amp;utm_medium=ingest&amp;utm_medium=ingest&amp;utm_source=markets&amp;utm_medium=ingest&amp;utm_source=markets&amp;utm_medium=ingest&amp;utm_source=markets&amp;utm_medium=ingest&amp;utm_source=markets">S&amp;P 500</a>: 5,509.01, up 0.62%</li><li><a target="_blank" href="https://markets.businessinsider.com/index/dow_jones?utm_source=markets&amp;utm_medium=ingest%3Futm_source%3Dmarkets&amp;utm_medium=ingest&amp;utm_medium=ingest&amp;utm_source=markets&amp;utm_medium=ingest&amp;utm_source=markets&amp;utm_medium=ingest&amp;utm_source=markets&amp;utm_medium=ingest&amp;utm_source=markets">Dow Jones Industrial Average</a>: 39,331.85, up 0.41% (+162.33 points)</li><li><a target="_blank" href="https://markets.businessinsider.com/index/nasdaq_composite?utm_source=markets&amp;utm_medium=ingest%3Futm_source%3Dmarkets&amp;utm_medium=ingest&amp;utm_medium=ingest&amp;utm_source=markets&amp;utm_medium=ingest&amp;utm_source=markets&amp;utm_medium=ingest&amp;utm_source=markets&amp;utm_medium=ingest&amp;utm_source=markets">Nasdaq composite</a>: 18,028.76, up 0.84%</li></ul>Here's what else is going on today:<ul><li><a target="_blank" href="https://www.businessinsider.com/russia-economy-housing-market-property-prices-mortgage-subsidies-ukraine-war-2024-7">Russia is shuttering a mortgage program that triggered a property boom</a>, amid fears of an overheating economy.</li><li><a target="_blank" href="https://www.businessinsider.com/housing-market-home-prices-rents-mortgage-rates-outlook-morgan-stanley-2024-7">Why housing will stay unaffordable even if the Fed cuts rates</a>.</li><li><a target="_blank" href="https://markets.businessinsider.com/news/bonds/trump-election-odds-treasury-bond-yields-inflation-deficit-debt-economy-2024-7">The bond market is signaling a higher likelihood of a second Trump presidency</a>, market veteran Ed Yardeni says.</li></ul>In commodities, bonds, and crypto:<ul><li><a target="_blank" href="https://markets.businessinsider.com/commodities/oil-price?type=wti&amp;utm_medium=ingest&amp;utm_source=markets&amp;utm_medium=ingest&amp;utm_source=markets&amp;utm_medium=ingest&amp;utm_source=markets&amp;utm_medium=ingest&amp;utm_source=markets">West Texas Intermediate</a> crude oil slid 0.5% to $82.96 a barrel. <a target="_blank" href="https://markets.businessinsider.com/commodities/oil-price?utm_medium=ingest&amp;utm_source=markets&amp;utm_medium=ingest&amp;utm_source=markets&amp;utm_medium=ingest&amp;utm_source=markets">Brent crude</a>, the international benchmark, inched 0.24% lower to $86.39 a barrel.</li><li><a target="_blank" href="https://markets.businessinsider.com/commodities/gold-price?utm_medium=ingest&amp;utm_source=markets&amp;utm_medium=ingest&amp;utm_source=markets&amp;utm_medium=ingest&amp;utm_source=markets">Gold</a> stayed essentially flat at $2,330.49 per ounce.</li><li>The 10-year Treasury yield fell four basis points to 4.432%.</li><li><a target="_blank" href="https://markets.businessinsider.com/currencies/btc-usd?utm_medium=ingest&amp;utm_source=markets&amp;utm_medium=ingest&amp;utm_source=markets&amp;utm_medium=ingest&amp;utm_source=markets">Bitcoin</a> fell about 2% to $61,884.</li></ul>

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