Facebook Invests $5.7 Billion In Reliance Jio

Reliance Industries share took a high jump when the social media giant Facebook announced buying a minority stake in Reliance Jio. It would invest $5.7 billion (Rs. 43,574 crore) in the Mukesh Ambani owned telco firm. With the investment, Facebook will become the largest minority shareholder in Jio Platforms Limited.

Highlights of the share market news

• Reliance Industries witnessed a jump of 103 points (8.33%) from Rs. 1,236 to Rs. 1,339

• Sensex traded 131 points higher at 30,758

• Reliance Industries share was also a top gainer on Nifty

• On NSE, its share gained over 8% to Rs. 1,339

• Total 4.11 lack shares were traded on BSE

• The trading value of shares was Rs. 55.72 crore

• After trading, the market cap of the firm increased to Rs. 8.23 lack crore on NSE

Stock of Reliance Industries Limited

The 5, 20 and 50 day moving average of RIL stock was higher after the trading but lower than the 100 and 200-day mowwving averages. Also, RIL reported a gain of 13.57% in one week and 28.03% … Read the rest

Biggest Ever Meltdown In Crude Oil Prices Explained

A measure of oil volatility skyrocketed to more than 400% on Monday when crude oil went below to $10 a barrel and then to zero and then slipped into the land of negative. And it is the first time that crude crashed into negative territory.

Monday’s wild market action

Brimming storage tanks signal extreme disconnect between supply and demand due to coronavirus-led economic slowdown. The present demand for crude oil is at a standstill. Here’re three actions that describe the market condition.

Selling Frenzy

The May contract of West Texas Intermediate crude’s front-month contract closed at a more than $50-a-barrel discount to the June contract. And it is the biggest discount on record. It could be due to the traders rushing to sell the May contract ahead of its expiration on Tuesday.

Wild Swings

Tariq Zahir, a commodity fund manager at Tyche Capital Advisors LLC commented on the falling crude oil prices to negative zone. He said that oil prices in their opinion had nowhere to go but lower from there on the June contract. He further maintained that the demand wasn’t coming back anytime soon. They would have a … Read the rest

Traders Ask To Extend Lockdown To April 30 But With Relief Package

Confederation of All India Traders (CAT) stands with the government in the time of COVID-19 spread. National General Secretary of CAT, Pravin Khandelwal, wrote to the PM to extend the lockdown period to April 30.

CAT supports extension of lockdown

A survey conducted among traders and business leaders of various states, the business community said that they want the lockdown to be extended beyond the 21-day period. They said that the current situation of novel coronavirus spread demands stricter measures to contain the spread of the deadly disease. And the business community was unanimous in the decision to extend the lockdown period.

The CAT assured that the traders would leave no stone unturned to deal with the virus. Also, the confederation assured the PM that India would be victorious in its fight against the spread of novel coronavirus.

Challenges ahead

In a letter to the PM the confederation mentioned the hardships that the small and medium scale traders would have to face in the fight against the pandemic. The lockdown period would result in slowdown of business resulting in big losses. But the increasing number of coronavirus cases demand strict … Read the rest

Oil Industry Faces Demand Crash In April

The oil is an all time low this month and this unparalleled demand destruction could transform the industry for years to come. The energy analysts anticipate that daily consumption of oil will plummet by 15 million to 22 million barrels in April in comparison to the demand last year.

Demand destruction in oil sector

In a March note, Goldman Sachs Group Inc. said that shutting down the demand would have large scale and persistent ramifications to supply. Goldman anticipates a surge of 20 billion barrels a day in storage tanks in April. And HIS Markit predicts that the world will run out of storage space for oil in middle of the year.

April is predicted to be the worst ever month for global demand for jet fuel. According to industry consultant FGE forecasts American, the gasoline consumption could plunge by 50% in comparison to the last year. And Energy Aspects Ltd. predicts the global benchmark Brent crude to drop by $10 a barrel, a level not seen in more than two decades.

Aftereffects of April crash in oil

The April crash will be start of a second bleak quarter for … Read the rest

Tom Aspray Explains Features Of A Bear Market Rally

Tom Aspray said that sharp rebounds were always to be expected during bear markets. He said it in the context of his recent discussion on the 1987 market crash and past bear markets. But his focus was to highlight the six-day rally that took the S&P 500 up 19% from the lows that started on October 28, 2008.

Result of the six-day rally

During the first rally in 2008 bear market, the press said that the market was in the process of establishing a bottom. But the S&P 500 was making a new low even seven days after the rally. The market commentators delivered similar comment after the last week’s three-day rally. But Tom Aspray wasn’t convinced with those comments.

Tom’s vision of bear markets

He said that it is necessary to acknowledge and navigate bear market rallies in order to understand the bear markets. He gave example of Invesco QQQ Trust (QQQ) that witnessed a high of $192.72 at last Thursday’s high point. Tom said that it was just a few cents above the 38.2% Fibonacci retracement resistance at $192.64.

He further said that on Thursday, Nasdaq 100 Advance/Decline … Read the rest

IMF Projects Recovery From Recession In 2021

International Monetary Fund (IMF) said that the world had entered a recession due to the coronavirus pandemic.But the IMF projects a recovery next year.

IMF Managing Director Kristalina Georgieva said that they have reassessed the prospects for growth for 2020 and 2021. It was clear that the world had entered a recession as bad or worse than in 2009. Also, they projected recovery in 2021.

Recovery from COVID-19 in 2021

IMF managing director emerged from the meeting of the governing body of IMF and Financial Committee that represent 189 members. The meeting was to discuss the unprecedented challenge posed by COVID-19.

She said that the key to recovery was only if the international community succeeded in containing the virus and prevent liquidity problems. The US was in recession, as was the rest of the advanced economies of the world. Also, the developing economies were in recession. They were working on their projections for 2020 said Georgieva in the answer to a question.

Georgieva stressed the need for virus containment for the economy to stand still. She said that containment was very necessary to come … Read the rest