US-Japan trade deal, Indian passport gets stronger, & more — Daily Digest
Wednesday, 3 July 2025
Markets opened above yesterday’s closing point.
Nifty 50 gradually rose throughout the day and closed in green.
Auto stocks and healthcare stocks rose the most today. Realty stocks and media stocks fell the most.
Global markets: Most US markets closed in green. European and most Asian markets rose.
News
The US President announced a trade deal with Japan, imposing 15% reciprocal tariffs on Japanese imports.
India’s passport now ranks 77th in the Henley Passport Index, up from 85th last year. The index measures passport strength by the number of countries accessible without a prior visa — currently 59 for India.
India will resume issuing tourist visas to Chinese citizens from 24 July. It had been suspended in 2020.
The Enforcement Directorate (ED) has filed a complaint against Myntra under the Foreign Exchange Management Act (FEMA) for alleged violations worth Rs 1,654.35 crore.
Indiqube Spaces IPO was subscribed 0.87 times. Retail Subscription: 3.41 times. IPO closes on 25 July.
GNG Electronics IPO was subscribed 8.99 times. Retail Subscription: 8.89 times. IPO closes on 25 July.
Stocks Updates
Infosys: net profit rose 8.7% year-on-year to Rs 6,921 crore in the April-June quarter.
Dr Reddy’s: net profit rose 2% year-on-year to Rs 1,418 crore in the April-June quarter.
Bajaj Housing: net profit rose 21% year-on-year to Rs 583 crore in the April-June quarter.
SRF: net profit rose 71% year-on-year to Rs 432 crore in the April-June quarter. Dividend announced: Rs 4 per share with record date: 29 July. It also approved 2 capital expenditure projects: Rs 490 crore for a 60,000 MTPA BOPP film plant in Indore, M.P., and Rs 250 crore for an agrochemical facility in Dahej, Gujarat.
Persistent Systems: net profit rose 39% year-on-year to Rs 425 crore in the April-June quarter.
Hyundai Motor: received a Rs 517.3 crore GST demand and penalty on SUVs for the Sept 2017 to March 2020 period.
Tata Consumer: net profit rose 15% year-on-year to Rs 334 crore in the April-June quarter.
Word of the Day
Cyclical Sectors
They are industries whose performance rises and falls with the overall economy
They do well when the economy grows and tend to decline during slowdowns.
Example: consider the automobile sector.
When the economy is doing well, incomes rise. People tend to spend more. So car sales rise and so do the prices of auto stocks.
But during slowdowns or recessions, people do not make big purchases. Thus, car sales fall.
Real estate, airline, agriculture, construction, etc. are the industries that are cyclical in nature.
6 Day Course
Theme: allocating monthly income
Day 3: Wednesday
How much should rent be?
If you live in a rented house and are not paying any home loan EMIs, you should try to keep rent under 30% of your income.
This varies widely based on the city you are residing in. In certain cities like Mumbai, it might be difficult to stick to this 30% rule.
If you are living on rent, and paying a home loan EMI, the rent should ideally be even lower.
In such cases, it is okay to skip investing in FD, mutual funds, etc.
In such a situation having an emergency fund with at least 6 months’ expenses (including EMIs) is an absolute must.
It is better to build this emergency fund before investing and/or taking a home loan.
Featured Question
Q. “Why many index mutual fund have different return even though they are based on same index?”
Great observation.
Even if different index funds track the same index, their returns can vary.
When we say ‘vary’, we mean it is usually lower than the index.
This is an important metric to check when assessing the index fund.
Most indices are updated two times a year.
When this update takes place, index funds are supposed to buy/sell their stocks such that they follow the index.
In this process, differences arise.
Some stocks’ price can change fast while index funds are still buying/selling.
In addition to that, the fund fees or expense ratio can also affect the returns.
Index funds keep some cash to pay when investors redeem. This is also one reason for some underperformance of returns.
When they receive dividends, there might be some time spent before the money is re-invested.
All of these factors can cause the returns to be different from the actual index.
This is called tracking error.
Index funds that have low tracking errors are considered good.
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