Hello there, Espresso lovers! You know, out of the 365 days in a year, you’ll find Mumbaikars complain about crowded trains, potholes, traffic and whatnot for 355 of them, yet go about their business diligently. But these 10 other days are Bappa time! When Bappa is here, the city feels different, the vibe feels different, the fervour feels different, and during these 10 days, the complaints, cribbing, everything takes a backseat. We can only pray to the Vighnaharta to get rid of all the Vighnas in our lives, and in the markets as well! For the markets, there are plenty of them!
If you wanted to use rose petals to find the answer to “will he or won’t he”, you would’ve emptied out the entire garden before getting the answer. The “he” in question? Kevin Warsh. The new Fed Chair. More secretive than secret itself. He eventually did. Pulled the trigger. Raised rates by 25 basis points, the first time in three years. He had to. He was caught in a “idhar kua, udhar khai” situation (Devil and the Deep Blue Sea). If he did not raise rates now, the fact that he was controlled by the White House would be firmly established. If he did, brickbats were certain from the White House.
Of course, Donald Trump was not pleased with the decision but still has words of praise for Mr Warsh. He blamed the “hostile” Fed board behind the rate decision, and still wants the US to have the lowest interest rates anywhere in the world. Well, we started the year projecting that the Fed would CUT thrice this year, but then someone decided to have an adventure in Iran that has now gone on for seven months, and those three rate cuts have turned into three rate HIKES. Yikes! Nobody lets the greatest President of all time live in peace. Boo Hoo! The dot plot even suggests that there might be more to come! Wonder how long he will continue to have the same words of praise for Mr Warsh. Your guess is as good as ours.
There’s an old saying – Charity begins at home. The Tatas have taken that seriously, and we are extremely proud of that. However, if they wanted to produce a daily soap, they could’ve done one in Film City, not at Bombay House. Charity begins at home; daily soaps don’t. The second season of Kahaani Tata Sons Ke Board Room Ki is currently being shot at the Bombay House. The cast includes Noel Tata, N Chandrasekaran, Venu Srinivasan, other members of the board, and an extended cameo by the SP Group. Who plays what character? We’ll let you decide that. Casting isn’t our forte.
The RBI wants Tata Sons to list. Noel Tata Doesn’t. The Board wants N Chandrasekaran to stay as Chairman for another five years. Maybe he does, maybe he doesn’t, but Noel Tata doesn’t want that either. The board overruled him in a vote. He called the vote illegal. He now wants to take the matter to the AGM, where he plans on voting Chandra out. The SP Group is all in for Tata Sons to list, calling it a “social and moral imperative.” That social and moral imperative will also enable them to monetise their own stake and bring their own spiralling debt situation under control (that’s in brackets/asterisk). This needs to end soon. The credibility and pride of India’s most trusted and loved business houses are at stake. They have their task cut out, so do we. Guess our friend Rachna Dhanrajani has many more newsbreaks lined up from Bombay House. She couldn’t be happier!
While this drama continues, another might just be coming to an end soon enough. HDFC Bank, as our friend Ritu Singh reports, could well be on course to announce its successor to Sashidhar Jagdishan soon, maybe as early as this weekend. Whoever it may be – Kaizad Bharucha or Anup Bagchi- it will be a difficult choice for them to make as to what should be their first priority: clean up the bank’s battered image, or continue to focus on the business, hoping that if that does well, the image will clean itself up. We are waiting to see this chapter flash “THE END” and find out who gets on the hot seat of India’s largest private lender.
We are all embarrassed by the entire match-fixing scandal. But have you ever heard of yield fixing? That’s what Chris Wood of Jefferies expects the Trump administration to do if things go out of hand in the bond markets. If the yields remain between 5% and 6%, Wood expects gold prices to go up to $10,000 an ounce, which, according to him, will be a massive positive for Indian households that own gold, as it will monetise their balance sheet and be positive for the booming gold lending market as well! He also spoke about a potential AI implosion and how that would be instrumental in bringing foreign capital back to India. You can watch this entire conversation Wood had with Prashant Nair right here. If you want to read about it, our friend Gareema has taken the effort to put together all the key takeaways from the interview here as well.
If you all were wondering why the iPhone did not get a mention in the previous episode, it took me that long to process the fact that a mobile phone could also cost ₹4 lakh. Oh wait, ₹4,49,900 to be precise. So if someone gives ₹4.5 lakh in cash or writes a cheque, will they return the 100 bucks as change? Maybe. Will be helpful for the auto fare to get back home. What all can you do with ₹4.5 lakh? Have a luxury holiday? Pay rent for 6-7 months in Mumbai (In other cities it could be a year or even more)? Shell out 90% of the payment for a car? But that’s for non-iPhone Paglus. For the iPhone Paglus, they were queued up outside the Apple stores in Mumbai, Delhi and Bengaluru from the early hours of the morning to lay their hands on the new iPhone 18 and PRO MAX. The Duo, yes, that same kidney-burning priced phone, begins to sell on October 23. Don’t be surprised to see a long queue for that either. Tell us in the comments what all you would do if you had ₹4.5 lakh.
Where are oil prices headed? JPMorgan says we don’t know. Yes. That was one confession that stirred the market chatter all through Friday. Their note says it is increasingly difficult to establish a baseline scenario for oil because they just don’t know what the endgame for the Iran war is. They have also warned that if there is no diplomatic breakthrough between Trump and Xi next week, it will be very difficult to believe in the assumption that this oil supply disruption is temporary.
By the time it’s next Saturday, Bappa would have headed home, leaving us all emo yet again; NSE, whose IPO has been fully subscribed, would have become a listed company, and BSE would be days away from being called a Nifty 50 constituent, while Wipro, for the first time, will no longer be part of the benchmark index. But what happens in Iran? What will Donald Trump do? Will there be a solution to this sooner? The answer to that is what JPMorgan said: We don’t know. Next week will also be the 15th Episode of Markets Espresso. For all the love, reads, comments and subscriptions, we are very grateful! Do like, share, subscribe and follow us on our social media handles as well. Until then, Ganpati Bappa Morya!
