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Today’s agenda:

Global energy prices are sky-high. Crude oil is at a seven-year high. The surge catapulted Saudi Aramco into the $2 trillion club last week. Prices of natural gas have also double in the last six months. And global carbon emission-reduction plans have had a negative effect on an already supply-constrained coal. The combination of these price rises could have impact on inflation, and damp consumer spending in the coming months.

This is evident in the surge in petrol, diesel and LPG prices. On Sunday, Diesel crossed ₹100-a-litre-mark in Gandhinagar and Leh. The price of petrol in Delhi rose to its highest-ever level of ₹104.14 a litre and ₹110.12 per litre in Mumbai.

On coal, Power Ministry’s data shows a nearly 2% dip in consumption, which could slightly improve the supply situation. Consumption dipped by 72 million units (MU) to 3,828 MU on October 9 compared to 3,900 MU on October 8. The Union government also termed fear of coal shortage as ‘misplaced’, confirming that there is currently 24-days of supply available.

Our blog will be tracking developments in energy markets. We’ll also track other developments, including the one  at the International Monetary Fund (IMF). The lender’s board will soon decide on the data-rigging allegations against its Managing Director Kristalina Georgieva. The 24-member board is looking to complete its review before it kicks off its annual meetings this week. Central bankers and finance ministers from across countries will attend IMF and World Bank’s events this week at Washington, D.C.  – John Xavier

Follow our live blog for more updates on the global economy, markets and corporations.

12:05 P.M.

Crude jumps on global energy crunch

Oil prices soared again as supply restraint from major producers during an energy crisis gave a blow to major economies.

Brent crude rose or 1.5% to $83.59 a barrel.  U.S. oil also soared 1.9% to $80.86 a barrel, after rising 4.6% through Friday. 

Coal and gas prices have also been surging. In India, some states such as Punjab, Kerala, Rajasthan and Tamil Nadu might experience blackouts and electricity cuts due to coal shortage. In China, the government ordered miners to ramp up coal production as power prices surge.

11:20 A.M.

Rupee slumps against US dollar

The Indian rupee fell 17 paise to 75.16 against the U.S. dollar in opening trade today after settling for 74.99 on Friday. The rising crude prices and strength of the American currency in the overseas market is weighing on the domestic unit.

At the interbank foreign exchange, the rupee opened on a weak note at 75.11, before falling further to 75.16, a decline of 17 paise from the last close. While the dollar index, which gauges the greenback’s strength against a basket of six currencies, rose 0.08% to 94.13.

11:00 A.M.

Reliance doubles down on renewables

Reliance is upping its efforts to become net carbon zero by 2035. The owner of the world’s biggest refining complex said on Sunday it will buy Norwegian-headquartered solar panel maker REC Solar Holdings for $771 million,  and take up to 40% stake in India’s Sterling and Wilson Solar through Reliance New Energy Solar Ltd (RNESL), a wholly owned subsidiary of Reliance Industries Ltd (RIL).

The acquisition comes after Reliance said in June it would invest $10.1 billion in clean energy over the next three years.

Buying REC Solar will help Reliance expand in Australia, Europe, and the United States, according to billionaire Mukesh Ambani.

As the discussions around global warming take centre stage, fossil fuel firms are facing pressure form investors and activists to reduce carbon footprint. Major oil companies including Royal Dutch Shell Plc and BP Plc aim to become net zero-carbon firms by 2050.

10:15 A.M.

Global Minimum tax deal

Over 130 countries have joined hands to make it harder for big com

panies to avoid taxation. In an agreement overseen by the Organization for Economic Cooperation and Development, a global minimum tax of 15% would be levied on large multinationals such as Apple, Google and Facebook.

The goal is to urge big companies to pay taxes in countries where they earn income. The move is the first such step in almost a century after the double tax avoidance convention.

The discussion to put in place international tax rules had been ongoing for a past few years. Firms usually shift their profits to low tax tax jurisdiction countries. But COVID-19 pandemic and need to improve tax revenues accelerated the talks.

The tax agreement will come into affect starting 2023.

9:25 A.M.

Asian markets | Sensex update

Indian benchmark equity indices started the week on a lower note amid mixed global cues. At 9:17 IST, the Sensex was down 0.17% at 59958.81 and the Nifty was down 0.13% at 17872.

Asian shares rise, extending last week’s run, Technology shares rallied in Japan and China. Japan’s Topix rose 1.4% in early trade. Hong Kong’s Hang Seng Index rose 2%. China’s Shanghai Composite Index also added 0.3%

Japanese shares rose after Prime Minister Fumio Kishida said he wasn’t considering changes to the country’s capital-gains tax while Chinese tech stocks rose on easing concerns about Beijing’s crackdown on internet platforms.

Australia was a contrarian as Down Under’s S&P/ASX 200 fell 0.6% today.

 

—-  Edited by John Xavier

 

(With inputs from Reuters, PTI and other news agencies.)