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Best of BS Opinion: Dancing in sync with power, policy, and passion
Take India's post-liberalisation economy. Once open to global footwork, it now risks retreating into a solo act, where industrial giants take centre stage while the rest fade into the wings. As our first editorial notes, it's not conglomerates, who are out of step, but the policy music that encourages them to twirl endlessly alone, leaving little room for newcomers to join the floor.
In another corner of the hall, Priya Nair has just made history at Hindustan Unilever. But her appointment as CEO is a rare spin, not yet a choreographed movement. Only 5 per cent of listed firms have women CEOs. As our second editorial cautions, unless firms widen the floor to include women in finance, operations and core leadership, gender diversity will remain an ornamental pause, not a dynamic step.
K P Krishnan likens the Jane Street case to a misstep in India's financial rhythm. Markets that once moved in harmony — spot, derivatives, futures — now lean precariously on a single toe: options. And Sebi, instead of leading with clear, formal instruction, has turned to improvisation. Without structural recalibration, India's market credibility may find itself tripping.
Elsewhere, in a surprising reverse dip, the Environment Ministry has revised its stance on flue gas desulphurisation. As Vinayak Chatterjee explains, the shift from rigid mandates to region-specific nuance is like switching from stiff choreography to a more interpretive style, one that listens to the stage it's dancing on.
And then there's Sonal C Holland, India's first Master of Wine, whose autobiography One in a Billion: Becoming India's First Master of Wine, reviewed by Neha Kirpal reads like a solo performed against the grain. Holland didn't just learn the steps, she changed the music in a wine-averse country. From working in hotel sales to conquering the arcane world of wine certification in her thirties, her pivot was equal parts grit and grace. From scepticism to sommeliers, Holland's journey is a masterclass in turning passion into a lifelong performance.
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Mint
an hour ago
- Mint
Vijay L Bhambwani's Ticker: It's time for bulls to make their presence felt
Ticker is a weekly newsletter by Vijay L Bhambwani. Subscribe to Mint's newsletters to get them directly in your email inbox. Dear Reader, Last week, I wrote about the daunting prospect of overhead supply (selling by bulls trapped at higher levels) weighing on bulls. That hypothesis was validated by the markets as indices slipped in the latter half of the week. Triggers for the overhead supply remain unchanged. Proposed changes in the US and UK, which may reduce the flow of money to pension funds, are worrying bulls. It should be remembered that pension funds manage huge sums as long-term assets under management (AUM), which makes them the biggest institutional investors in equity markets. If AUMs fall in the pension fund industry, support to equity markets may be impacted as well. The delay in tying up trade deals and fears of slowing consumer spending worldwide are also weighing on sentiments. This is an expiry week, and therefore, traders are likely to be preoccupied with rolling over or squaring up (closing) their trades. Volatility is usually higher in expiry weeks. The positive trigger that emerged is that traded volumes perked up in the derivatives segment. This was partly due to Jane Street being allowed to resume operations in India. Aggressive follow-up buying will be crucial to revive sentiments. Do note the Nifty-50 has slipped for four weeks in a row, and bulls are running out of time. If they are to get a grip on sentiments, they must make their presence felt before the 24,800 support I have been mentioning for a fortnight is violated. In terms of sectoral action, public sector undertakings will continue to attract traders due to the emotional and financial stakes being relatively high in these stocks. Banking stocks within the PSU space will be particularly volatile. As we approach the Reserve Bank of India's announcement on interest rates on 7 August, traders are likely to ramp up their exposure on these stocks. Larger two-way moves are expected on these stocks. Metal prices may witness routine month-end short-covering, which can perk up metal and mining stock prices this week. Upsides will remain capped, however. Oil and gas-related stocks will also witness hectic trades, as energy prices are slipping on global commodity exchanges. Bullion remains bullish for the patient long-term investor, who is willing to look past calendar 2025. Oil and gas prices are likely to stay subdued, and rallies, if any, are likely to run into selling pressure. I maintain my long-standing view that energy markets are well-supplied and shortages exist only in market narratives. I recommend my readers traders light with tail risk (hacienda) hedges in place to avoid any shocks to capital. Being an expiry week makes it even more pressing to prioritize capital preservation over trading profits. A tutorial video on hacienda hedges is here - Rear View Mirror Let us assess what happened last week so we can guesstimate what to expect in the coming week. The fall was led by the broad-based Nifty, whereas the Bank Nifty logged gains. Being heavily weighted in the Nifty index, banking stocks cushioned the declines in the Nifty which, otherwise, may have slipped significantly. A weak dollar aided sentiments in emerging markets including India. Safe-haven buying eased in bullion, which otherwise remained firm. Oil and gas fell sharply as demand growth was feared to contract in the near future. The rupee eased versus a weakening dollar, which underscores the nervousness in the forex peg. Indian forex reserves slipped marginally, which weighed on sentiments. The Indian 10-year sovereign bond yields rose which dragged banking stocks since banks are the biggest investors in bonds. NSE market capitalization slipped 1.54%, which indicates broad-based selling. Market wide position limits (MWPL) rose routinely ahead of the expiry. US headline indices rose, providing tailwinds to our markets, which could have otherwise slipped deeper. Retail Risk Appetite – I use a simple yet highly accurate yardstick for measuring the conviction levels of retail traders – where are they deploying money. I measure what percentage of the turnover was contributed by the lower and higher risk instruments. If they trade more of futures which require sizable capital, their risk appetite is higher. Within the futures space, index futures are less volatile compared to stock futures. A higher footprint in stock futures shows higher aggression levels. Ditto for stock and index options. Last week, this is what their footprint looked like (the numbers are average of all trading days of the week) – Turnover contribution in the higher-risk, capital-intensive futures segment was marginally higher. Much of it can be attributed to the rollover of trades from the July to August series. This results in dual turnover being logged, which is routine. In the relatively safer options segment, turnover rose in the stock options segment which is marginally more riskier than index options. Some of it can be rollover trades from July to August series. Overall. risk appetite remained subdued. Matryoshka Analysis Let us peel layer after layer of statistical data to arrive at the core message of the first chart I share is the NSE advance-decline ratio. After the price itself, this indicator is the fastest (leading) indicator of which way the winds are blowing. This simple yet accurate indicator computes the ratio of the number of rising stocks compared to falling stocks. As long as gaining stocks outnumber the losers, bulls are dominant. This metric is a gauge of the risk appetite of 'one marshmallow' traders. These are pure intra-day traders. The Nifty clocked smaller losses last week, but the advance-decline ratio slipped from 1.11 in the prior week to 0.67 last week. That means there were 67 gaining stocks for every 100 losing stocks. Intra-day buying conviction was lower. This ratio must stay above 1.0 sustainably all week for bulls to regain their lost initiative. A tutorial video on the marshmallow theory in trading is here - The second chart I share is the market wide position limits (MWPL). This measures the amount of exposure utilized by traders in the derivatives (F&O) space as a component of the total exposure allowed by the regulator. This metric is a gauge of the risk appetite of 'two marshmallow' traders. These are deep-pocketed, high-conviction traders who roll over their trades to the next session/s. The MWPL rose routinely ahead of the expiry week, but the peak was lower than the prior month's peak. This week being an expiry one, this reading can only fall this week. Swing traders are showing signs of hesitation. If markets rally strongly in the August derivatives series, bulls must ramp up their exposure levels to make their presence felt. Post-expiry routine decline should be watched keenly. If the low is higher than the 26.20 level of last month, it would imply some optimism.A dedicated tutorial video on how to interpret MWPL data in more ways than one is available here - The third chart I share is my in-house indicator 'impetus.' It measures the force in any price move. Last week, both indices fell with falling impetus readings. That tells us the fall was more of a gradual slide triggered by poor buying support rather than aggressive selling. Ideally, the price and impetus readings should rise in tandem to confirm a sustainable upthrust. The final chart I share is my in-house indicator 'LWTD.' It computes lift, weight, thrust and drag encountered by any security. These are four forces that any powered aircraft faces during flight; so, applying it to traded securities helps a trader estimate prevalent sentiments. Last week, the Nifty logged smaller declines, but the LWTD reading fell sharply to its lowest after the week ended 18 April, 2025. That implies lower fresh buying support for the Nifty this week. While short-covering can occur, it can cushion declines. For a fresh rally, aggressive follow-up buying will be required. A tutorial video on interpreting the LWTD indicator is here - Nifty's Verdict Last week, we saw a red candle on the weekly chart. This is the fourth bearish candle in a row. It was an inverted hammer candle. That indicates an abortive attempt by bulls as they tried to push prices higher but failed, and the index slid back into negative territory. The price remains above the 25-week average, which is a proxy for the six-month holding cost of an average retail investor. The medium-term outlook remains positive for now, as long as the price stays above this average. Last week, I advocated watching the 24,800 level, which bulls needed to defend in case of a decline. Note how the weekly low was 24,806. This threshold remains as the immediate support area to watch out for. The longer the index stays below this threshold, the more difficulty bulls may encounter on the upside. That is because overhead supply (selling from bulls trapped at higher levels) can limit rallies in the near term. On the flipside, the nearest resistance is at the 25,250 level, which must be overcome if the Nifty is to have a reasonable chance to rally. Your Call to Action – watch the 24,800 level as a near-term support. Only a break-out above the 25,250 level raises the possibility of a short-term rally. Last week, I estimated ranges between 57,500 – 55,050 and 25,525 – 24,400 on the Bank Nifty and Nifty respectively. Both indices traded within their specified resistance levels. This week, I estimate ranges between 57,725 – 55,325 and 25,375 – 24,300 on the Bank Nifty and Nifty respectively. Trade light with strict stop losses. Avoid trading counters with spreads wider than eight ticks. Have a profitable week. Vijay L. Bhambwani Vijay is the CEO a proprietary trading firm. He tweets at @vijaybhambwani
Mint
5 hours ago
- Mint
The bumpy road of derivatives: Take a close look at Jane Street's potholed path to market riches
Jane Street' is the title of multiple songs and the name of an indie rock band as well. Another Jane Street is currently in the public eye, a Manhattan-based high- frequency trading firm that was banned recently by the Securities and Exchange Board of India (Sebi), the market regulator. The firm has been allowed back into the market after it deposited over $550 million as a good-faith gesture while the regulator's investigation proceeds alongside. The Jane Street saga has raised multiple questions about India's regulatory framework for the securities market, especially the kid-glove handling of equity derivatives since their formal launch in 2001. There are also concerns over the nature of inter-regulatory monitoring and coordination, and whether it is adequate to stem malpractices in Indian capital markets. Also Read: Devina Mehra: How derivative dreams can turn into nightmares but still lure investors History holds some lessons. There was always the whiff of something rotten in the kingdom of Indian derivatives ever since futures and options were introduced afterbadla, an opaque over-the-counter product, was definitively banned. India's 1991 economic reforms took a wrecking ball to the old micro-structure of capital markets. Prodded by the 1992 securities scam, reformers decided to introduce transparent equity derivative products. But, given the political influence of the stockbroking lobby, it took a while to finally introduce futures and options;badlahad kept popping up in different forms. Unsurprisingly, Sebi decided to introduce individual equity futures alongside index products, contrary to official recommendations and global best practices. This was seen as a concession to the influential community of stockbrokers, who were in search of a speculative—and liquid—product to replacebadla. Also Read: Sebi's Jane Street interim order made India's stock market sit up for good reason There was another deviation from the 1997 L.C. Gupta Committee report, which had made the official recommendations: instead of physical settlements, the regulator chose cash settlements. Sebi's initial excuse was that exchanges lacked the required technology, infrastructure or management capacity to cope with the burden of physical settlements. Consequently, the futures and options market became a casino with no cover charge, or minimum buy-in requirements, fuelling large and unnatural spikes. Faced with the spectre of a market collapse and a crisis, Sebi finally implemented physical settlements in 2018 after a gap of 17 years. Meanwhile, retail investor interest shifted from equity futures to index options, given the opportunities for higher leverage and relatively lower capital requirements. Fintech firms acted as enabling midwives in the process, while the regulators looked away. And now along comes Jane Street and Sebi's interim order. Opinion remains divided over whether Jane Street's derivatives trading strategy was illegal, whether it was 'manipulation' or whether the trading firm was plain unlucky because its heavy volumes stood out in the Indian market's shallow infrastructure. However, on closer inspection, the market structure does seem to embolden rampages by high-frequency traders, perhaps at the cost of clueless retail speculators. Also Read: Jane Street: Gaming an outdated system is not necessarily illegal in India Let's try and connect some of the dots. Sebi's tracking data shows that a bulk of the derivatives trade orders originate from co-located servers, or from institutional traders that pay a higher fee to locate their servers next to the exchange servers, thus allowing them to strike deals within nano-seconds. According to Sebi's 2023-24 annual report: 'Based on modes of trading at exchange platform… 61.6% trading in the equity derivatives segment of NSE was through co-location route, primarily used by proprietary traders… In case of BSE, 60.1% trading in the equity derivatives segment of BSE was through co-location route." Simultaneously, there has been a surge of uninformed retail investors entering the derivatives market, lured by the facility of low capital commitment and easy profits. Sebi whole-time member Ananth Narayan said at a recent conference that 91% of individual traders incurred net losses in equity derivatives during 2024-25, with the total losses crossing ₹1 trillion. Although it may be difficult to prove a direct link, it does beg the uncomfortable question: Were retail investors the counter-parties that Jane Street and other traders needed to rack up their super-profits? Juxtapose those retail losses against Sebi's estimate of Jane Street's profits of ₹36,500 crore over two years. Also Read: Andy Mukherjee: Jane Street's secret sauce for Indian markets should be tested out Sebi took some remedial action in October 2024 and May 2025 to deter retail traders, but the damage had already been done. It is surprising that Sebi chose to ignore repeated red flags raised by multiple market observers over the past two-three years, even when data was pointing to unnatural spikes. And though Jane Street has now been identified, Sebi should also reveal the names of Indian companies indulging in similar manipulation. Sebi must also identify fintech companies that inveigled unschooled retail investors into derivatives trading, thereby providing large traders with easy pickings. This may require Sebi to coordinate regulatory action with the Reserve Bank of India (RBI) because many firms helped investors take unsecured loans to satisfy their speculative urges. The Sebi-RBI combo should also coordinate efforts to overhaul the profile of India's derivatives market in favour of large institutional traders, especially by reworking the outdated rule that limits bank finance for institutions. The author is a senior journalist and author of 'Slip, Stitch and Stumble: The Untold Story of India's Financial Sector Reforms' @rajrishisinghal
Hans India
8 hours ago
- Hans India
Bajaj Finance's market valuation drops by Rs 17,524 crore this week
Mumbai: Bajaj Finance's market valuation declined by Rs 17,524.3 crore this week, bringing its total market cap down to Rs 5.67 lakh crore. The sharp fall came amid a broader weakness in equities, which saw six of India's top-10 most valued companies suffer a combined erosion of Rs 2.22 lakh crore. The market slump occurred during a week when the benchmark Sensex slipped by 294.64 points or 0.36 per cent -- marking the fourth straight week of decline for domestic equities. Other major companies that recorded losses in market valuation included Reliance Industries, Infosys, Tata Consultancy Services (TCS), Hindustan Unilever, and Life Insurance Corporation of India (LIC). Reliance Industries took the biggest hit, with its market value plunging by Rs 1.14 lakh crore to Rs 18.83 lakh crore. Infosys saw an erosion of Rs 29,474 crore, while LIC's valuation dipped by Rs 23,086 crore. TCS and Hindustan Unilever also posted significant declines of over Rs 20,000 crore and Rs 17,339 crore, respectively. Ajit Mishra, Senior Vice President of Research at Religare Broking, said that the markets remained under pressure due to mixed signals. "Initially, earnings from the banking sector lifted sentiment, especially with strong results from HDFC Bank and ICICI Bank. But the decline in heavyweight stocks like Reliance capped any meaningful recovery," he explained. He added that foreign fund outflows and uncertainty over global trade deals ahead of the August 1 deadline contributed to high volatility in the markets. On the positive side, HDFC Bank led the gainers with an increase of Rs 37,161 crore in its market value, taking its valuation to Rs 15.38 lakh crore. ICICI Bank, Bharti Airtel, and State Bank of India also registered gains in their market caps. The most valued Indian companies included HDFC Bank, TCS, Bharti Airtel, ICICI Bank, SBI, Infosys, Bajaj Finance, Hindustan Unilever, and LIC.
