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Nifty and Sensex Tumble, Flipkart to Buy Stake in Hotstar et al

Professor of Financial Economics and Part-time Value Investor, Transfin.
Sep 17, 2018 12:25 PM 3 min read
Editorial

Good evening readers, 

 

I bet at some point of 'time' in your life someone said to you that 'Time is Money'. Whether they themselves subscribed to this age-old cliche is inconsequential, what they never told you was how much money Time is worth. Well... it's worth exactly $190 million, because billionaire Marc Benioff  (Co-founder & CEO of Salesforce) and his wife Lynne Benioff  are buying Time Magazine for $190 million.

 

Frivolous word plays aside, this is yet another wealthy person buying a media publication. Anyone remember Jeff Bezos buying Washington Post not too long ago for $250 million or days after Billionaire Red Sox owner John Henry purchasing the Boston Globe for $70 million. Or Laurene Powell Jobs, the wife of the late Steve Jobs, acquiring a majority stake in the Atlantic magazine. It could go on and on.

 

As they say, the love affair between Billionaires and News media is akin to Twilight Saga on steroids. Actually no one says that... but.. whatever... 

 

That being said, its time to recap today's top 6 business stories through our End Of Day Wrap Up:

 

Govt to merge Vijaya Bank, Dena Bank, and Bank of Baroda to create country's 3rd largest lender.
 
Network synergies including low cost deposits, larger customer base, market reach, and other operational efficiencies cited as basis behind merger. Government says capital support will be ensured.
 
 
Domestic markets slip sharply; Nifty & BSE Sensex close down by -137.45 (-1.19%) and -505.13 (-1.33%) points respectively.

BSE Sensex and Nifty 50 slipped sharply by -505.13 (-1.33%) and -137.45 (-1.19%) points respectively today. BSE Sensex closed at 37,585.51 at market close while Nifty 50 closed at 11,375.75. A combination of factors drove the sell-off. On the macro front, weak global cues impacting emerging markets coupled with the expectation that US President Donald Trump is closing in on announcing tariffs on $200 billion of imports from China pressured the markets. This was further exacerbated by a lack of clear-cut incisive measures coming out of Friday's after-market close economic review announcement by Government of India.    

 

Walmart Inc owned Flipkart is in talks to buy a stake in Hotstar as per press reports.

As per press speculations, Walmart Inc's Flipkart is in talks to buy a stake in Star India's video digital delivery platform Hotstar. This is in the backdrop of a rapidly evolving domestic video content landscape and as such appears to be Flipkart's defense against Netflix and Amazon Prime video in the Indian marketplace. 

 

Goldman Sachs goes bearish on Indian equities; downgrades to 'market-weight' from 'over-weight'.

Global research and brokerage firm, Goldman Sachs downgraded its India recommendation to 'market-weight' from 'over-weight' on account of recent strong performance and lofty valuations in Indian equities. A less stable central government as a possible outcome of the 2019 general elections is also perceived as a downside risk. 

 

US / INTERNATIONAL

 

US-China trade wars expected to escalate this week.

President Trump’s administration is expected to unveil fresh tariffs on $200 billion in Chinese imports. However, in an attempt to preserve American consumers' reliance on Chinese products with upcoming elections in mind, the administration appears to have been toying with the idea of lowering the tariff rate to about 10% from the earlier proposed 25% level. 

 

Chinese Stocks slip to four-year low.

Rising trade tensions, weak Yuan and somewhat weak company fundamentals have collectively pressured Chinese stocks. Consequently, at market close today, Shanghai Composite Index closed at the lowest level since 2014 at 2561.79, down 1.1% in the day.

 

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