🔐 Lockdown extended, changing interest rates effect on debt funds.

Gaurav Chakraborty
Gaurav Chakraborty
gauravc@orowealth.com

Orowealth Weekend Reads: April 19, 2020

LAST WEEK MARKET MOVES

SensexNiftyNifty Midcap 100Nifty Smallcap 100
31,588.72 (+1.38%)9,266.75 (+1.70%)13,046.80 (+3.93%)4,091.15 (+7.04%)

 

TAX SAVING INVESTMENTS

It’s that time of the year when tax saving is on the top of your list. With only a few days left to make your investment declarations, you might be searching for options to save more on taxes. With dozens of products in the ELSS category, you can have a hard time selecting one. Save tax up to Rs 52,350 before 30th June by investing in the below schemes.

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NEWS WE HAVE BEEN FOLLOWING

#Lockdown2
In the second segment of the nationwide lockdown, the government has decided to allow some economic activities after April 20 based on the monitoring of areas pertaining to the spread of the novel coronavirus. These activities will not be allowed in areas that have been declared as containment zones by states and union territories. All goods traffic will be allowed to operate whether by rail, air or sea. Land transportation will carry essential goods like petroleum, food, and medical products. Repair shops and dhabas will be allowed to operate on highways. Farming activities will be allowed along with agencies that buy agricultural products.

IT and ITeS services can operate at 50% strength and data and call centers for government services will function as well. Cold storages, courier services, and vehicles used by e-commerce companies will also be allowed to work. Self-employed individuals like electricians, plumbers, motor mechanics, and carpenters will also be allowed.

Takeaway-
The government has also allowed industries located in rural areas to resume operations to help the rural economy.

#RealEstateDecline
HDFC Chairman Deepak Parekh expects real estate prices to decline by 20% because of the slump in demand caused by the coronavirus pandemic. He also offered suggestions to state governments, the Reserve Bank of India (RBI), and developers to deal with the financial and economic crisis. Some of his suggestions are as follows: He has asked state governments to incentivize migrant workers to come back to construction sites and resume work. He also wants them to consider waiving stamp duty and registration charge on housing for a limited time to support the sector. He has asked the RBI to oversee the effectiveness of monetary transmission as even after rate cuts, bond yields have not fallen in a commensurate manner. He expects the central bank to provide comfort to banks which have become risk averse due to non-performing assets. He suggested that the RBI directly buy corporate bonds and commercial papers to enhance liquidity in the market as just offering loans against government bonds is not enough. He has also asked the bank to extend NPA recognition cycle to 180 days from 90 days. Lastly, he has asked developers to assess long-term strategy and capability before applying for moratoriums and be careful about leveraging. He has also asked them to complete existing projects even if it means pushing new launches to a later date.

Takeaway-
These are some of the suggestions that he expects the three entities to ponder over to support the real estate sector.

FROM OUR BLOG SECTION

How to Choose Best SIP?

SIP (Systematic Investment Plan) has probably become one of the most talked about the term since the mutual fund industry garnered investors’ focus. SIP is one of the ideal forms of investing in mutual funds.

How Do Interest Rates Affect Debt Funds?

Changing interest rates have a great effect on the capital market and thus on financial products. From bonds to bank loans, varying interest rate affect the attractiveness of every debt instrument.

QUOTE OF THE WEEK
“Be like a postage stamp. Stick to one thing until you get there.”
– Josh Billings (the pen name of American humorist Henry Wheeler Shaw)
Chosen by Kriti – Orowealth.

Gaurav Chakraborty
Gaurav Chakraborty
gauravc@orowealth.com

Gaurav is an engineer-turned-digital marketeer. Also a personal finance blogger with experience in financial planning and crowdfunding sector. He is a part of the Marketing team at Orowealth.

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