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<keyword id="19991358" type="General" weightage="100" keywordseo="Indian-markets" source="keywords">Indian markets</keyword> are navigating choppy waters as global economic shifts, from rate cuts to evolving political climates, create new pressure points across the financial landscape, according to a recent report by ANI attributed originally to the Union Bank of India. The domestic stock and bond markets showed signs of strain, with <keyword id="19910363" type="General" weightage="20" keywordseo="bond-yields" source="keywords">bond yields</keyword> witnessing slight adjustments. India’s 10-year government bond yield dipped to 6.82%, a decrease from the previous session, reflecting cautious investor sentiment as the markets react to shifting global indicators. Meanwhile, the 5-year bond yield remained steady at 6.76%, a signal of lingering hesitation amid economic unpredictability. In the currency market, the rupee faced a notable decline, ending the day at ₹84.3725 against the US dollar, slipping from its prior close of ₹84.2800. Market analysts point to significant capital outflows as a key factor, with investors moving funds to perceived safer assets overseas. This migration has weighed heavily on the rupee, underlining the currency’s vulnerability in an environment of global economic flux. India’s stock market bore the brunt of this volatility, with key indices falling over 1%, effectively erasing the gains of a previous rally. This abrupt drop reportedly reflects renewed investor anxiety, largely triggered by the recent <keyword id="20189882" type="General" weightage="20" keywordseo="US-presidential-election" source="keywords">US presidential election</keyword> results. Experts suggest that the election has introduced a fresh layer of uncertainty, not only for the US economy but for global markets, impacting everything from policy decisions to investor sentiment. Analysts are also keeping a close eye on upcoming decisions by central banks, which will likely shape the path forward for the Indian equities market. Commodities showed contrasting trends, with Brent crude prices falling on lower demand expectations, as economic indicators point toward cautious spending globally. Gold, on the other hand, experienced a modest rise as investors sought refuge in safe-haven assets, highlighting a shift towards risk aversion among market participants. Globally, major central banks made coordinated efforts to sustain economic growth, with the Bank of England (BoE) announcing a 25 basis-point cut, lowering its benchmark rate to 4.75%. The BoE’s Monetary Policy Committee (MPC) largely backed this move to counter inflation, which has been declining, albeit gradually. Across the Atlantic, the US Federal Reserve mirrored this action with its own 25 basis-point cut, a sign of confidence in the ongoing economic recovery. Both rate cuts, though modest, signal a global trend towards caution as economies work to balance growth with stability. In Asia, the People’s Bank of China (PBoC) maintained its supportive stance. Governor Pan Gongsheng sought to reassure foreign investors by reaffirming the PBoC’s commitment to growth-oriented policies. Pan emphasized enhanced communication and pledged to open China’s financial services sector further, aiming to attract more international participants. Europe, meanwhile, faced mixed economic signals. Germany reported a steep 2.5% drop in industrial production in September, signalling a slowdown in manufacturing, while the Eurozone saw a mild 0.5% rise in retail sales, reflecting cautious consumer optimism in the region. Adding another layer to the global economic landscape, the European Union’s Climate Change Service warned that 2024 could be the hottest year on record, underscoring urgent climate challenges just as the UN COP29 climate summit approaches. The summit, set to take place in Azerbaijan, aims to rally increased funding for climate action, though tempered expectations linger in light of recent US political shifts. On the domestic front, Niti Aayog CEO BVR Subrahmanyam spoke about India’s potential role in pivotal global trade agreements, specifically the Regional Comprehensive Economic Partnership (RCEP) and the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP). These partnerships, Subrahmanyam suggested, could bolster India’s Micro, Small, and Medium Enterprises (MSME) sector, which currently accounts for 40% of India’s exports, offering a strategic advantage for Indian trade in an interconnected world. As the Indian markets digest these developments, experts believe continued volatility could be the theme for the coming months. (with ANI inputs)

Indian markets under pressure as global rate cuts stir uncertainty, new report says

Earlier today, RBIs MPC (Monetary Policy Committee) decided to leave the <keyword id="20094323" type="General" weightage="100" keywordseo="repo-rate" source="keywords">repo rate</keyword> unchanged at 6.5%, while changing the policy stance toward neutral. The aim, as <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> maintained, was to strike a balance between taming domestic <keyword id="19895000" type="General" weightage="20" keywordseo="inflation" source="keywords">inflation</keyword> and maintaining target growth. A neutral stance gives the RBI the flexibility to adjust <keyword id="19950650" type="General" weightage="20" keywordseo="interest-rates" source="keywords">interest rates</keyword> based on the direction of inflation, as opposed to its previous stand of withdrawing accommodation, which eliminates any possibility of rate cuts. While a change of stance doesn’t necessarily mean a cut should follow, most experts view this as a prelude to a possible rate cut in December this year, or even February next year. Says Deepak Ramaraju, Senior Fund Manager, Shriram AMC, "The RBI stance has changed to neutral, indicating that its primary focus is to balance growth and inflation. Growth has been resilient and given the short-term pressure on inflation, RBI may continue to hold interest rates unchanged in Q3 FY 2025. Based on inflation moderating below 4.5% and course of geo-political concerns, the RBI may undertake a rate cut decision in Q4 FY 2025". So, what does this mean for your investments? How will this decision impact your existing funds? We take a look. <h2>Good time to invest in high-yield deposits</h2>This is a good time to invest in high-yield <keyword id="19975805" type="General" weightage="20" keywordseo="fixed-deposits" source="keywords">fixed deposits</keyword> and long-term bonds. That's because with rate cuts imminent in the upcoming quarters, you'd be able to lock-in your funds with the prevailing, relatively higher interest rate right now. As for the yellow metal or gold, it is generally considered a safe haven asset during turbulent market times. That's why you should consider making it a part of your investments, or increasing its weightage in your overall portfolio, depending on your needs. Vijay Kuppa, CEO, InCred Money highlights that with deposit rates at elevated levels, one has an ideal opportunity for locking in high-yield fixed deposits."At the same time, high borrowing costs also make a compelling case for increasing debt allocations in investment portfolios, which offer a buffer against potential equity market corrections, which might occur due to <keyword id="19955176" type="General" weightage="20" keywordseo="geopolitical-tensions" source="keywords">geopolitical tensions</keyword>", he continues. With the chronic crisis in Middle-East flaring up again, as Israel looks to target Lebanon and Iran, you can expect some volatility and downturns in the <keyword id="19949641" type="General" weightage="20" keywordseo="equity-markets" source="keywords">equity markets</keyword>, both in India and globally, in the times to come. Over the last 5 days, Sensex has dipped by over 1,900 points, or about 2.38%, and Nifty has also gone down by 2.23%. With this set to continue for some time, you can reconsider and evaluate your investments in debt. Mahendra Kumar Jajoo, CIO – Fixed Income, Mirae Asset Investment Managers (India) explains that the market is confident of a rate cut in the times to come, and that the <keyword id="20066775" type="General" weightage="20" keywordseo="bond-market" source="keywords">bond market</keyword> has already started pricing in the same. "We have already seen some of this already, with 10Y GOI yields at around 6.75%, having already eased significantly in last few months. So, if investors wait for rate cut to invest, it may be too late for them. Also, with corporate credit picking up, investing in corporate bond funds for a period of 3-5 years can also serve the investor well. Investors having a long term investment horizon and appropriate risk appetite can also invest in gilt funds", he continues. <h2>Dont exit the markets yet </h2>Though short-term biases of FII may continue towards Chinese markets keeping pressure on the equity markets, the resilient domestic flows can defy deep corrections in the equity markets despite high valuations. The markets may trend positive with subsequent rate cuts by the US Fed later this year. Hence, it wont be advisable to completely exit the equity markets during these times, notes Avnish Jain, Head - Fixed Income, Canara Robeco Mutual Fund Jain advises to take a buy on dips approach towards the stock markets i.e. adding quality stocks to your portfolio during times of market downturn. Shrikant Chouhan, Head Equity Research, Kotak Securities says that the current market texture is volatile, hence level based trading would be the ideal strategy for the day traders. "For the bulls now, 25,050/81,700 would be the key level to watch out. Above the same market could retest the level of 25,200-25,225/82,000-82,300. On the flip side, 24,900/81,200 would be the key support zone for the traders. Below the same, the selling pressure is likely to accelerate. Below the same, market could slip till 24,800-24,780/81,000-80,700", explains Chouhan. <h2>Time to buy a home? Maybe! </h2>No rate cut can spell some good news for homebuyers who are looking to get their hands on real estate during the festive season. Even as home loan rates remain steady as of now, homebuyers may have to wait until December or beyond to get any tangible relief in their home loan EMIs. Vimal Nadar, Head of Research, Colliers India explains that a change in stance from “withdrawal of accommodation” to “neutral” indicates its clear direction for a possible reduction in interest rates in the foreseeable future. This ongoing stability in repo rate should provide a significant thrust to residential real estate during these festive months as home loan interest rates are likely to remain steady. "Typically, Q4, marked by higher inclination of homebuyers to wrap-up property purchases during the auspicious period combined with instantaneous liquidity benefit aided by developers offering attractive discounts, has historically provided the final push to housing sales across the major markets in the country", he added.

RBI leaves repo rate unchanged. What does this mean for you?

Markets regulator <keyword id="19901201" type="General" weightage="20" keywordseo="Sebi" source="keywords">SEBI</keyword> has proposed expanding the <keyword id="22367248" type="General" weightage="20" keywordseo="sustainable-finance-framework" source="keywords">sustainable finance framework</keyword> in the <keyword id="20922662" type="General" weightage="20" keywordseo="securities-market" source="keywords">securities market</keyword> by introducing a new category of financial instruments. This category will include <keyword id="20518791" type="General" weightage="20" keywordseo="Social-Bonds" source="keywords">social bonds</keyword>, <keyword id="22623575" type="General" weightage="20" keywordseo="Sustainable-Bonds" source="keywords">sustainable bonds</keyword>, and <keyword id="22623576" type="General" weightage="20" keywordseo="Sustainability-linked-Bonds" source="keywords">sustainability-linked bonds</keyword>, in addition to the current <keyword id="22819966" type="General" weightage="20" keywordseo="green-debt-securities" source="keywords">green debt securities</keyword>. It aims to provide issuers with flexibility in raising funds for projects that align with environmental, social, and governance (ESG) objectives. In a consultation paper released on Friday, SEBI proposed that issuers, in addition to existing green debt securities, should be allowed to raise funds through issuance of social bonds, sustainable bonds, and sustainability-linked bonds. These bonds will collectively be known as ESG Debt Securities. This will enable issuers to raise money for more sustainable projects, assisting in closing the funding gap for the Sustainable Development Goals. SEBI said it received representations from market participants including the Confederation of Indian Industry to expand the scope of the regulatory framework pertaining to sustainable finance to include social bonds, in addition to existing green debt securities as a mode of raising sustainable finance, in line with global practices. As per the consultation paper, SEBI said, it "proposed to introduce the concept of sustainable securitised debt instruments for the purpose of providing originators of the underlying credit facilities which are within such international or domestic frameworks for sustainable finance, and thereby provide investors as well an opportunity to participate in the sustainable securitised debt instruments". The consultation paper also addressed the initial and continuous disclosures for sustainable securitised debt instruments that would be based on international frameworks. Initial disclosures could be made in the offer document for the securities, while continuous disclosures might be included in annual reports or other mandated formats. The markets watchdog also suggested that issuers of ESG debt securities and sustainable securitised debt instruments appoint an independent external reviewer or certifier, to facilitate transparency and credibility. The review could take various forms including, second-party opinions, verification, certification, or scoring/ rating. The <keyword id="19901204" type="General" weightage="100" keywordseo="Securities-and-Exchange-Board-of-India" source="keywords" meta.keywordsubtype="org" meta.entityname="Securities and Exchange Board of India" meta.hostid="261" meta.entityid="Securities and Exchange Board of India">Securities and Exchange Board of India</keyword> (SEBI) has invited comments and suggestions from the public on the consultation paper by September 6.

SEBI proposes expansion of sustainable financial framework in securities market

“Ye le beta, humare khaandani sone ke gehne. Ise girvi rakhva de, shayad kuch paise aa jaye ghar main.” How many times have we seen similar dialogues repeat itself in Bollywood films of the 70s and 80s—abject poverty and a frail-looking old mother pleading to her son to pawn the family’s heirloom gold ornaments to a jeweller, all to get a few bucks? Well, if you’d ask that son in 2024, he’d rather hit the loan button on his <keyword id="105386" type="General" weightage="20" keywordseo="Demat-account" source="Orion">Demat account</keyword> than pawn his mother’s gold jewellery. Given how Indians are rapidly resorting to taking loans against their investments in shares and mutual funds, these might as well be a cherished family heirloom in today’s time. Fair warning though; it's not as if gold and loans against it are going down in India’s lending scene. It's very much the opposite, shining brighter than ever! The secured loan category is having its time in the spotlight, and people are certainly looking beyond land and property to get their hands on some extra monies! But what is funding the steep rise behind these loans? And are they as failsafe and secure as they’re made out to be? We decode for you in this week’s Simply Put. <h2 style="margin-bottom: 0.7em; line-height: 1.3; color: rgb(0, 0, 0); font-size: 24px; background: 0px 0px; text-rendering: optimizelegibility;">The great Indian pawning party</h2>Pawning one’s gold has been, by far, the OG Indian financial move to get a loan. That continues well into 2024, and apparently, more so when India decides to wed and celebrate! Data from <keyword id="30067" type="General" weightage="20" keywordseo="RBI" source="Orion">RBI</keyword> suggests that the outstanding amount on gold loans has swelled from Rs 85,009 crore in September 2022 to Rs 1,47,081 crore in September 2024. It looks like Gold took the motto of rise and shine too seriously! Table 1: Growth in gold loans <table class="redcator-table-advance" style="border-width: initial; border-style: none; background-color: rgb(255, 255, 255); font-size: 16px; line-height: 1.6em; box-shadow: none; width: 468pt; font-family: Merriweather; table-layout: fixed; padding-bottom: 10px !important; background-image: inherit !important; background-position: inherit !important; background-size: inherit !important; background-repeat: inherit !important; background-attachment: inherit !important; background-origin: inherit !important; background-clip: inherit !important;"></colgroup><tbody><tr><td style="border-width: 1pt; border-style: solid; border-color: rgb(0, 0, 0); padding: 5pt; font-size: 16px; vertical-align: top; overflow: hidden; overflow-wrap: break-word;">Year </td><td style="border-width: 1pt; border-style: solid; border-color: rgb(0, 0, 0); padding: 5pt; font-size: 16px; vertical-align: top; overflow: hidden; overflow-wrap: break-word;">Amount (In Rs crore) </td></tr><tr><td style="border-width: 1pt; border-style: solid; border-color: rgb(0, 0, 0); padding: 5pt; font-size: 16px; vertical-align: top; overflow: hidden; overflow-wrap: break-word;">September 2022 </td><td style="border-width: 1pt; border-style: solid; border-color: rgb(0, 0, 0); padding: 5pt; font-size: 16px; vertical-align: top; overflow: hidden; overflow-wrap: break-word;">85,009 </td></tr><tr><td style="border-width: 1pt; border-style: solid; border-color: rgb(0, 0, 0); padding: 5pt; font-size: 16px; vertical-align: top; overflow: hidden; overflow-wrap: break-word;">March 2023 </td><td style="border-width: 1pt; border-style: solid; border-color: rgb(0, 0, 0); padding: 5pt; font-size: 16px; vertical-align: top; overflow: hidden; overflow-wrap: break-word;">89,370 </td></tr><tr><td style="border-width: 1pt; border-style: solid; border-color: rgb(0, 0, 0); padding: 5pt; font-size: 16px; vertical-align: top; overflow: hidden; overflow-wrap: break-word;">September 2023 </td><td style="border-width: 1pt; border-style: solid; border-color: rgb(0, 0, 0); padding: 5pt; font-size: 16px; vertical-align: top; overflow: hidden; overflow-wrap: break-word;">97,426 </td></tr><tr><td style="border-width: 1pt; border-style: solid; border-color: rgb(0, 0, 0); padding: 5pt; font-size: 16px; vertical-align: top; overflow: hidden; overflow-wrap: break-word;">March 2024 </td><td style="border-width: 1pt; border-style: solid; border-color: rgb(0, 0, 0); padding: 5pt; font-size: 16px; vertical-align: top; overflow: hidden; overflow-wrap: break-word;">1,02,562 </td></tr><tr><td style="border-width: 1pt; border-style: solid; border-color: rgb(0, 0, 0); padding: 5pt; font-size: 16px; vertical-align: top; overflow: hidden; overflow-wrap: break-word;">September 2024 </td><td style="border-width: 1pt; border-style: solid; border-color: rgb(0, 0, 0); padding: 5pt; font-size: 16px; vertical-align: top; overflow: hidden; overflow-wrap: break-word;">1,47,081 </td></tr></tbody><tbody></tbody><tbody></tbody><tbody></tbody><tbody></tbody><tbody></tbody><tbody></tbody></table> Source: RBI data While the world continues to be riled up in multiple geopolitical crises in 2024, gold has been making merry of these tough times. Thus far this year, <keyword id="3886593" type="General" weightage="20" keywordseo="domestic-gold" source="Orion">domestic gold</keyword> prices have grown by 23%, outperforming benchmark indices like Nifty and Sensex by a mile, which have gone up by 9.85% and 8.86%, respectively. The growth in gold loan disbursal rates month on month this year could also put Nifty and Sensex’s growth to shame. In just September 2024, gold loans grew an astounding 51%, up from 40.9% in August, 30.5% in June, and just 14.8% in March. <h2 style="margin-bottom: 0.7em; line-height: 1.3; color: rgb(0, 0, 0); font-size: 24px; background: 0px 0px; text-rendering: optimizelegibility;">Hey, wait up for me, says LAS</h2>In lockstep with the elder, gold loan sibling, advances against shares and bonds have also been inching up since 2022. Data from RBI (Reserve Bank of India) notes that as of September 2022, the outstanding quantum of loans that were taken against shares (LAS) and bonds stood at Rs 7,397.94 crores. This inched up to Rs 7,764 crore in September 2023. Come 2024, and it looked like this was LAS’ time to shine. Loans swiftly skyrocketed, with outstanding loans in this category going up from Rs 8,492 crore in March 2022 to a staggering Rs 9,546 crore at the end of September 2024. Naturally, the smoke of LAS has its fire in the record inflows that Indians are pouring into the stock market and mutual funds month on month. Per AMFI (<keyword id="134904" type="General" weightage="20" keywordseo="Association-of-Mutual-Funds-in-India" source="Orion">Association of Mutual Funds in India</keyword>), the net AUM (assets under management) of India’s mutual fund industry grew to Rs 67,25,614.61 crores in October 2024, up from Rs 67,09,259.24 crores in September 2024. Even the number of retail mutual fund folios, which include equity, hybrid, and solution-oriented mutual funds, burgeoned to 17,23,52,296 in October, as compared to 16,81,61,366 in September. The same goes for stock investments in India, where the number of new demat accounts that are added every month just simply refuses to climb down. As of last month, total demat accounts in the country stood at 17.9 crore, which is more than the entire population of full-fledged nations like Japan (12.45 crore), Russia (14.38 crore), and Bangladesh (17.3 crore). In fact, since February this year, the monthly growth of LAS has been hitting double digits. From 11.3% in March to 21.6% in May to 26.8% in August, growth in LAS has been exceptional, hitting 22.9% in September this year. For context, monthly growth in the LAS segment was at a mere 5% in September 2023. <h2 style="margin-bottom: 0.7em; line-height: 1.3; color: rgb(0, 0, 0); font-size: 24px; background: 0px 0px; text-rendering: optimizelegibility;">What's driving the growth?</h2>It's a win-win for both the bank and the customer. Customers love them because LAS is available at a lower interest rate compared to unsecured personal loans. You can get a loan at an interest rate of anywhere between 9 and 12% by pledging your gold, MF units, or shares. Compare this to over 10-28% rates, which is the range where unsecured personal loans charge interest. Banks love <keyword id="827883" type="General" weightage="100" keywordseo="Secured-Loans" source="Orion">secured loans</keyword> since they are well-secured. In case you default on paying back, the bank can sell off your gold, shares, or mutual fund units to recover the amount. This takes a lot of stress off the banks, which are already dealing with secured loans’ riskier sibling-<keyword id="947940" type="General" weightage="20" keywordseo="unsecured-lending" source="Orion">unsecured lending</keyword>. High NPAs (non-performing assets) and non-payments in the unsecured borrowing space have already put RBI on red alert, which is why the apex bank is tightening the screws on unsecured lending, which was well on its way to becoming a ticking time bomb. As a result, credit growth has moderated to 12.8% YoY in October, as against the 19.3% rise recorded in the year-ago period. Yet it's not like the banks won't feel the heat. Analysts at Nomura note that <keyword id="23954457" type="General" weightage="20" keywordseo="personal-loan-delinquencies" source="Orion">personal loan delinquencies</keyword> in India that have been overdue by over 90 days rose to 5.1% in the last financial year, as opposed to just 3.9% in the year prior. <h2 style="margin-bottom: 0.7em; line-height: 1.3; color: rgb(0, 0, 0); font-size: 24px; background: 0px 0px; text-rendering: optimizelegibility;">How does it work?</h2>Both these loans work on a similar principle: Your <keyword id="857141" type="General" weightage="20" keywordseo="loan-amount" source="Orion">loan amount</keyword> is equal to a certain percentage of the actual market value of your asset. This is known as the LTV (loan-to-value ratio). In the case of gold and debt mutual funds, RBI mandates that this LTV be about 75-80%. So, for every Rs 100 of gold or debt mutual fund unit you pledge, your maximum loan amount cannot exceed Rs 80. If you pledge gold, which has a market value of Rs 10 lakh, you can take a loan of up to Rs 8,00,000. In the case of shares and mutual fund units, this limit is set at 50%. So, your shares worth Rs 5,00,000 can only get you a loan worth Rs 2,50,000. But the bright side? You can continue earning returns on your investments and pay interest only on the amount you use, since this loan works as an overdraft facility. <h2 style="margin-bottom: 0.7em; line-height: 1.3; color: rgb(0, 0, 0); font-size: 24px; background: 0px 0px; text-rendering: optimizelegibility;">Super safe, you say?</h2>Interest rates on both of these loans are very much dependent on the market value of the asset, which wildly fluctuates on a day-to-day basis. So, in case the value of your asset falls, you’ll have to keep a margin or more of the same asset in order to continue with the loan and maintain the LTV balance. Failure to do so could mean the bank can even sell off your asset. Says financial planner Nema Chaya Buch. “Yes, LAS offers easy availability of funds since these loans come with a lower interest rate as compared to personal loans. Also, you continue to earn average returns of 10–13% on your equity investments. But the downside is, in case of emergency, those pledged securities cannot be sold. Also, if the equity market goes down, then the bank may ask for additional collateral. Raghvendra Nath, MD, Ladderup Wealth Management notes that taking a LAS is best when the value of your securities has appreciated significantly. “This allows you to maximize the loan amount based on your collateral while also addressing financial needs without having to liquidate your investment portfolio. However, there are notable disadvantages to consider. The market risk is significant; a substantial decline in market value could lead to margin calls, which may incur fees and charges if there are delays or prepayments, ultimately increasing the effective cost of borrowing. Furthermore, failure to make timely payments could result in the loss of your assets.”. Umesh Mohanan, ED &amp; CEO, of Indel Money, cautions that one should have a sufficient quantity of gold to get the loan amount one wants. "According to the current RBI rules, the loan applicant/borrower can draw up to 75% of the total market value of the collateral/gold jewellery. So, always carry a sufficient quantity of gold based on one’s loan requirement. “The most important thing is that the valuation of the gold depends on the purity of the gold. If the borrower pledges gold with higher purity, such as 24 carats or 22 carats, he will get the maximum loan amount," he adds.

Secured Loans 2.0 — why more and more Indians are turning to gold, shares and mutual funds to get loans

<ul class="summary-list"><li>Indexes rallied Thursday on positive jobs data and promises of further economic stimulus in China.</li><li>Jobless claims fell 4,000 to a four-month low of 218,000, beating estimates of a mild increase.</li></ul>US stocks rallied on Thursday, fueled by China stimulus measures and positive jobs data to pare losses from yesterday.The indexes rallied after leaders in China pledged to support the economy with more strong policy measures.That sentiment comes just days after the country unveiled a series of stimulus measures in a rare move to prop up the country's sluggish economy, which is plagued by weak domestic demand and a struggling property sector.The indexes' gains were also fueled by positive labor market data. Jobless claims fell unexpectedly last week, down 4,000 to a four-month low of 218,000, according to Labor Department data released Thursday.Those claims mark two weeks of straight declines, and came in significantly lower than economists' forecasts of a rise to 225,000.Meanwhile, second-quarter GDP came in unrevised at a 3% annualized rate, according to data released Thursday. First quarter growth was revised up to 1.6% from 1.4%.That positive data will likely give markets more confidence in the underlying strength of the US economy as traders continue to expect a series of rapid rate cuts over the next year.Markets are pricing in a 52% chance of another jumbo 50 basis-point-rate cut from the Federal Reserve in November, according to the CME FedWatch tool.On Friday traders will be focused on new personal consumption expenditure data, the Fed's preferred inflation gauge.Here's where US indexes stood at 10:10 a.m. on Thursday:<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">S&amp;P 500</a>: 5,754.44 up 0.6%</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">Dow Jones Industrial Average</a>: 42,097.73, up 0.4% (181 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">Nasdaq composite</a>: 18,251.97, up 0.9%</li></ul>Here's what else is going on today:<ul><li>Benard Arnault added <a target="_blank" class="" href="https://markets.businessinsider.com/news/stocks/china-economy-stimulus-bernard-arnault-6-billion-richer-lvmh-stock-2024-9">$6 billion to his net worth</a> in a day after China's stimulus sparked a rally in luxury stocks.</li><li>Hedge fund manager Eric Jackson believes we may be in for an <a target="_blank" class="" href="https://markets.businessinsider.com/news/stocks/stock-market-everything-rally-returnsbull-surge-heats-up-nasdaq-gains-2024-9?_gl=1*8nbf8q*_ga*MTY3OTgyNjg0MS4xNzIxMDE2MDM2*_ga_E21CV80ZCZ*MTcyNzM1NTQ5MS4xODkuMS4xNzI3MzU3NzYyLjIxLjAuMA..">"everything rally"</a> as stocks mirror the early days of one of history's biggest bull markets</li><li>The US personal savings rate, a key US consumer indicator, has dipped to <a target="_blank" class="" href="https://www.businessinsider.com/recession-outlook-savings-household-spending-economy-2008-financial-crisis-2024-9">"crisis levels,"</a> SocGen says</li></ul>In commodities, bonds, and crypto:<ul><li>Oil futures fell. <a target="_blank" class="" href="https://markets.businessinsider.com/commodities/oil-price?type=wti">WTI crude</a> dipped 3.29% to $67.32 a barrel. <a target="_blank" href="https://markets.businessinsider.com/commodities/oil-price?utm_medium=ingest&amp;utm_source=markets">Brent crude</a>, the international benchmark, fell 3.13% to $71.13 a barrel.</li><li><a target="_blank" href="https://markets.businessinsider.com/commodities/gold-price?utm_medium=ingest&amp;utm_source=markets">Gold</a> was up 0.01% to $2,685 per ounce.</li><li>The 10-year Treasury yield rose six basis points to 3.794%.</li><li><a target="_blank" class="" href="https://markets.businessinsider.com/currencies/btc-usd">Bitcoin</a> rose 0.31% to $57,745.72</li></ul>

Stock market today: Indexes rally on China stimulus, promising labor-market data

<ul class="summary-list"><li>Indexes slipped Thursday as traders focused on remarks from Fed Chair Jerome Powell.</li><li>Powell said the Fed is in no hurry to cut rates, and reiterated the strength of the US economy.</li></ul>Indexes ended lower on Thursday, with the election rally fizzling out as traders digested remarks from Federal Reserve Chair Jerome Powell and assessed the latest inflation data. The S&amp;P 500 and Nasdaq fell more than 0.5%, while the Dow Jones Industrial Average lost over 200 points. The 10-year Treasury yield, meanwhile, remained nearly flat at 4.447%, hovering close to its highest level since July.Here's where US indexes stood at the 4:00 p.m. closing bell on Thursday:<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">S&amp;P 500</a>: 5,949.17, down 0.6% </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">Dow Jones Industrial Average</a>: 43,750.86, down 0.47% (-207.33 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">Nasdaq composite</a>: 19,107.65, down 0.64%</li></ul>The slide comes after Powell signaled the Fed is in no rush to cut interest rates while the US economy remains on solid footing. "The economy is not sending any signals that we need to be in a hurry to lower rates," Powell said during prepared remarks at an event in Dallas. "The strength we are currently seeing in the economy gives us the ability to approach our decisions carefully."Powell added the US has had the best domestic growth of any major economy, and emphasized the strength of the labor market. He said the October jobs report's slowing job growth was largely due to storm-related damage.Powell's comments come as investors seek hints of the Fed's intended easing path after a 25 basis point cut last week. Trump's election win has sparked worries that inflation could rise again under his proposals for broad tariffs and mass deportations, which could cause the Fed to pause rate hikes, economists say.Traders expect the central bank to cut another 25 basis points at its December meeting before pausing in January, according to the CME <a target="_blank" class="" href="https://www.cmegroup.com/markets/interest-rates/cme-fedwatch-tool.html">FedWatch tool</a>.Powell's comments also follow the latest inflation reading which shows wholesale prices rose 0.2% in October, according to data from the Bureau of Labor Statistics.The data was in line with expectations but showed inflation remains somewhat sticky, with a year-over-year increase of 2.4%.The core producer price index, which excludes food and energy prices, rose 0.3% in the month and 3.1% year-over-year.Meanwhile, jobless claims data on Thursday, showed weekly claims dropped to their lowest since May, falling to 217,000 last week. That marks a 4,000 decline from the week prior.Here's what else is going on:<ul><li>Investors are underestimating how deep <a target="_blank" class="" href="https://www.businessinsider.com/fed-interest-rate-cuts-outlook-2025-trump-tariff-inflation-growth-2024-11">rate cuts will be in 2025</a>, Goldman Sachs says.</li><li><a target="_blank" class="" href="https://markets.businessinsider.com/news/stocks/electric-vehicle-stocks-trump-end-ev-tax-credit-tesla-rivian-2024-11?_gl=1*1794use*_ga*MTY3OTgyNjg0MS4xNzIxMDE2MDM2*_ga_E21CV80ZCZ*MTczMTYxNjYwOS40MTAuMS4xNzMxNjE3NjM3LjIyLjAuMA..">EV makers slid</a> on report Trump wants to scrap the EV tax credit.</li><li><a target="_blank" class="" href="https://markets.businessinsider.com/news/stocks/disney-stock-price-3q-earnings-streaming-profit-guidance-cruise-parks-2024-11?_gl=1*6r1dtf*_ga*MTY3OTgyNjg0MS4xNzIxMDE2MDM2*_ga_E21CV80ZCZ*MTczMTYxNjYwOS40MTAuMS4xNzMxNjE3NjUxLjguMC4w">Disney stock surged</a> as rare three-year forecast sees strong profit growth ahead.</li><li>China's weak economy and record US production will lead to a <a target="_blank" class="" href="https://markets.businessinsider.com/news/commodities/oil-outlook-supply-crude-prices-us-production-china-opec-2024-11?_gl=1*1he4945*_ga*MTY3OTgyNjg0MS4xNzIxMDE2MDM2*_ga_E21CV80ZCZ*MTczMTYxNjYwOS40MTAuMS4xNzMxNjE3NjcwLjYwLjAuMA..">surplus</a> of one million barrels of oil a day next year, IEA says.</li></ul>In commodities, bonds, and crypto:<ul><li>Oil futures were up. <a target="_blank" class="" href="https://markets.businessinsider.com/commodities/oil-price?type=wti">West Texas Intermediate crude</a> rose 0.3% to $68.63 a barrel. <a target="_blank" href="https://markets.businessinsider.com/commodities/oil-price?utm_medium=ingest&amp;utm_source=markets">Brent crude</a>, the international benchmark, climbed 0.3% to $72.48 a barrel.</li><li><a target="_blank" href="https://markets.businessinsider.com/commodities/gold-price?utm_medium=ingest&amp;utm_source=markets">Gold</a> rose fell 0.5% to $2,572 an ounce.</li><li>The 10-year Treasury was nearly flat at 4.447%.</li><li><a target="_blank" class="" href="https://markets.businessinsider.com/currencies/btc-usd">Bitcoin</a> was down 1.4% to $87,531. </li></ul>

Stock market today: Indexes fall as Powell says the Fed is in no hurry to cut interest rates

<keyword id="19895063" type="General" weightage="20" keywordseo="India" source="keywords">India</keyword> requires an investment support of USD 1.4 trillion — an average of USD 28 billion per year — to become a net-zero economy by 2070 and raising <keyword id="20260327" type="General" weightage="20" keywordseo="financial-resources" source="keywords">financial resources</keyword> for adaptation and mitigation action of this scale is an "unprecedented challenge", according to the <keyword id="20613906" type="General" weightage="20" keywordseo="Economic-Survey" source="keywords">Economic Survey</keyword> 2023-24 tabled in Parliament on Monday. Reaching net zero means achieving a balance between greenhouse gas emissions and the amount of these gases removed from the atmosphere by either natural processes, such as photosynthesis, or by other methods of carbon capture and storage. The consolidated report on the state of the economy in the previous year said India's climate action has been largely financed through domestic resources and the flow of international finance has been "very limited". Citing the Reserve Bank of India's (RBI) data, the report said bridging the "substantial funding gap" necessitates allocating 2.5 per cent of India's annual Gross Domestic Product (GDP) to <keyword id="20018880" type="General" weightage="20" keywordseo="green-finance" source="keywords">green finance</keyword>. "Preliminary estimates indicate that the aggregate investment support required by India to achieve its 2070 net-zero target will be USD 1.4 trillion at an average of USD 28 billion per year. Raising financial resources for <keyword id="19907392" type="General" weightage="20" keywordseo="climate-change" source="keywords">climate change</keyword> adaptation and mitigation actions of this scale is an unprecedented challenge," the document read. A 2022 report by the Climate Policy Initiative found that domestic sources accounted for the majority of green finance in India, at 87 per cent and 83 per cent in financial years 2019 and 2020 respectively. While international sources are increasing (from 13 per cent in FY 2019 to 17 per cent in FY 2020), the economic survey said they are still insufficient to meet India's net-zero target. "Mobilising substantial capital from traditional sources presents multifaceted challenges in emerging economies like India. The perceived sovereign risks associated with emerging market and developing economies (EMDEs) and the capital-intensive nature of such projects, coupled with lengthy gestation periods and evolving regulatory frameworks, can create misalignment between investor expectations and project timelines," the government said. The economic survey also noted that the flows of global capital to <keyword id="20200084" type="General" weightage="20" keywordseo="developing-countries" source="keywords">developing countries</keyword> have been impeded by high costs of capital. Despite securing a good rating on its green-bond framework, Indian sovereign <keyword id="20177085" type="General" weightage="20" keywordseo="green-bonds" source="keywords">green bonds</keyword> have hardly received any "greenium" from private investors. It is more a "wall of capital" than a "flood of capital" that is waiting to fund energy transition in EMDEs. It is just not mobile. All of these together have severely hampered the flow of finance for green-transition projects, the survey said. "Greenium" or green premium refers to the savings an issuer of a green bond realises on the associated coupon payment because the bond is green. Financial support to help middle-income and poor countries fight climate change will be at the centre of this year's UN climate conference in Baku, Azerbaijan, where the world will reach the deadline to agree on the New Collective Quantified Goal (NCQG) -- the new amount developed nations must mobilise every year starting 2025 to support climate action in developing countries. But achieving consensus will not be easy, given the disappointing progress made on major conflict points at the mid-year UN climate talks in Bonn, Germany. At the 2009 UN climate conference in Copenhagen, rich nations pledged to provide USD 100 billion annually from 2020 to help developing countries mitigate and adapt to climate change. However, delays in achieving this goal have eroded trust between developed and developing nations and have been a continual source of contention during annual climate negotiations. In May, the Organisation for Economic Cooperation and Development (OECD) claimed that developed countries had met the long-standing USD 100 billion-a-year promise by providing nearly USD 116 billion in <keyword id="20000757" type="General" weightage="20" keywordseo="climate-finance" source="keywords">climate finance</keyword> to developing countries in 2022, with nearly 70 per cent of the money given in the form of loans. However, international non-profit organisation Oxfam last week said climate finance provided by rich countries in 2022 totalled no more than USD 35 billion. Developing nations argue that they cannot be expected to reduce carbon dioxide (CO2) emissions faster if developed countries -- historically responsible for climate change -- do not provide enhanced financial support. Rich countries are now expected to raise more than USD 100 billion, with developing countries, including India, demanding trillions of dollars to tackle climate change.

Raising massive financial resources for net-zero goal unprecedented challenge: Economic Survey

<ul class="summary-list"><li>The global population is getting older. </li><li>The trend will lead to lower returns, earnings growth, and valuations, JPMorgan strategists say.</li></ul>The aging of the world population is expected to accelerate in the coming decades, which will likely produce bad outcomes for the stock market, JPMorgan strategists say.The strategists say that historically, an older population has led to declining returns, lower earnings growth, and weaker valuations.Over a 10-year period, a 1% increase in the number of people over 65 is correlated with a 0.92% decline in annual stock returns, the strategists calculated in a report released last week.They point mainly to slower growth and falling valuations.With an older investor base looking to save for retirement, investment capital declines, leading to less innovation. That, plus slower growth in the workforce, will have a negative impact on earnings growth, the strategists say."Domestic population aging may reduce earnings growth for several reasons. It leads to slower workforce growth, reducing domestic economic growth. There is also evidence that aging can reduce innovation and productivity growth," the strategists said.That's especially true for companies that derive revenue from international operations, the strategists say."For companies that derive more of their revenue from abroad, like multinationals, global population aging (in a GDP-weighted sense) is likely to be more consequential for earnings growth than local population aging," the strategists wrote.That means equity market indexes with small and mid-caps will likely see more impact from local population aging than those with exclusively large caps.Valuations will also take a hit, the strategists said. As the elderly empty their retirement funds, national savings decline, thus raising bond yields. Older populations also pull out of the market at higher rates, driving down stock prices.Those trends, plus lower earnings growth expectations, justify lower valuations, the strategists say.The strategists say there's one bright spot, though. That's healthcare, which older populations tend to spend more on."We find a clear positive relationship between aging and excess returns on the sector, driven entirely by faster earnings growth," the strategists said.A 1% increase in the population share of those over 65 will lead to a 0.85% increase in health care returns over a 10-year period, the strategists say.The strategists note, too, that the populating aging trend won't impact countries equally. In China, the elderly share of the population is set to increase by seven percentage points in the next decade. The US, meanwhile, will see a more moderate rise from 18.1% to 21.5%.Past reports have also warned of the aging population's impact on the economy.Earlier this year, Barclays economist Jonathan Millar said boomers, a historically large generation, are approaching <a target="_blank" class="" href="https://www.businessinsider.com/baby-boomer-gen-z-millennials-economy-housing-job-market-stocks-2024-2">"peak burden" on the US economy</a> in the next few years. Meanwhile, <a target="_blank" class="" href="https://markets.businessinsider.com/news/stocks/recession-economy-outlook-us-stock-market-ownership-old-americans-retirement-2024-1">a larger share of people over 55% owning stocks</a> in the US may be a downside risk to the market, as older investors often don't have the luxury of holding through a downturn and could exacerbate volatility by selling during market pullbacks.

The world population is growing older. That's bad news for the stock market.

<ul><li>There is a suggestion to grant tax-free status to annuity income from the <keyword id="20240872" type="General" weightage="20" keywordseo="national-pension-scheme" source="keywords">National Pension Scheme</keyword> (<keyword id="19919089" type="General" weightage="20" keywordseo="nps" source="keywords">NPS</keyword>). </li><li>There is a proposal to simplify the capital gains <keyword id="6383566" type="General" weightage="20" keywordseo="taxation" source="Orion">taxation</keyword> structure by introducing a uniform holding period across domestic equities and <keyword id="6357979" type="General" weightage="20" keywordseo="mutual-funds" source="Orion">mutual funds</keyword>. </li><li>Providing relief from double taxation on dividends is anticipated to receive positive feedback from the <keyword id="31671" type="General" weightage="20" keywordseo="markets" source="Orion">markets</keyword>. </li></ul>The FY 2025 budget is around the corner and it is expected that Finance Minister Nirmala Sitharaman will fulfil some of the wishes of both the industry and the common people. A report by <keyword id="19908266" type="General" weightage="20" keywordseo="icra" source="keywords">ICRA</keyword> analytics lists down some changes they foresee when it comes to taxation and other investment products. Taxation The persistent call for the removal of the security transaction tax (<keyword id="20204742" type="General" weightage="20" keywordseo="stt" source="keywords">STT</keyword>) in financial markets has gained momentum in recent years, and as GST collections have risen, this demand has once again become a focal point. The potential elimination of STT is seen as a measure to attract more investors to participate in domestic equity markets. Another significant concern in the taxation landscape is the issue of double taxation on dividends. Under the current system, companies pay taxes on their profits, and simultaneously, the government levies additional taxes on dividends in the hands of shareholders. This results in double taxation on dividends. Addressing this issue by providing relief from double taxation on dividends is anticipated to receive positive feedback from the markets. <keyword id="6354432" type="General" weightage="20" keywordseo="pension" source="Orion">Pension</keyword> and <keyword id="35450" type="General" weightage="20" keywordseo="insurance" source="Orion">Insurance</keyword> In the domain of pension and insurance, there is a proposal to raise the minimum pension floor for unorganised sector workers under the Atal Pension Yojana (APY). The rationale behind this proposal is that the current pension amount may not attract enough potential subscribers to enrol in the scheme. Additionally, there is a suggestion to grant tax-free status to annuity income from the National Pension Scheme (NPS). This move is particularly crucial as senior citizens heavily rely on annuity income during their retirement years. Considering the rise in medical expenses and the financial well-being of senior citizens, providing tax-free status to annuity income is seen as a step towards supporting this demographic. Further, proposing a distinct tax deduction for life insurance premiums, separate from Section 80C, could boost the adoption of insurance products, encouraging people to secure their family's financial future through life insurance investments. Furthermore, there is a recommendation for the government to review the 18% Goods and Services Tax (GST) imposed on health insurance policies. Markets In the financial markets, one of the pressing issues is the need for a comprehensive policy on cryptocurrency regulation. With the rising popularity and usage of cryptocurrencies, a regulatory framework is considered essential to ensure orderly and secure participation in the crypto market. Another area of interest is the potential reintroduction of sovereign green bonds in the budget. Sovereign green bonds play a crucial role in addressing the funding requirements for sectors like wind, power, and hydropower, promoting sustainable investments. Additionally, there is speculation about the allocation of a significant capital outlay for an Energy Transition Fund. The focus of this fund would be on new-age fuels such as green hydrogen, ethanol, and other biofuels, aligning with the government's emphasis on energy transition and net-zero objectives. Mutual Funds Within the mutual funds sector, there are several proposals to address taxation-related disparities and encourage a more investor-friendly environment. There is a call for parity in taxation between equity mutual funds and Unit Linked Insurance Plans (ULIPs). Achieving parity between equity Fund of Fund and equity-oriented mutual funds for taxation is also under consideration. Furthermore, there is a proposal to simplify the capital gains taxation structure by introducing a uniform holding period across domestic equities and mutual funds. This move is expected to enhance compliance and streamline the tax treatment for investors. Lastly, there is a suggestion to revisit the tax changes introduced for debt funds last year. The amendment, while creating a level playing field between bank deposits and debt mutual funds, inadvertently affected certain categories of funds. However, a depositor in fixed deposits secures guaranteed returns regardless of fluctuations in interest rates, whereas an investor in debt funds is susceptible to both interest rate fluctuations and credit risk in the event of issuer defaults. Moreover, the elimination of the previous indexation benefit adversely impacted the tax-friendliness of global equity funds, equity fund of funds, gold funds, and hybrid funds with less than 35% equity exposure. Consequently, there is a possibility of revisiting the tax changes to address these issues. This revision aims to address unintended consequences and restore a tax-friendly environment for investors.

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Secured Loans 2.0 — why more and more Indians are turning to gold, shares and mutual funds to get loans

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Stock market today: Indexes rally on China stimulus, promising labor-market data

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Stock market today: Indexes fall as Powell says the Fed is in no hurry to cut interest rates

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Raising massive financial resources for net-zero goal unprecedented challenge: Economic Survey

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The world population is growing older. That's bad news for the stock market.

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