The week in charts: F O losses, jobs data, China stimulus

Speculative losses

A staggering 91.5% of individual traders lost money in options trading and 59.6% in futures in 2023-24, according to a study by Sebi. F&O trading is a type of investment where investors don’t buy or sell an actual asset but a contract that represents the asset at a specific price on a specific day in the future or at a specific price within a specified timeframe. The F&O lossmakers, however, incurred a smaller average loss of ₹120,000 per person in 2023-24 compared to ₹143,000 in the previous fiscal year.

Also Read: Data dive: What latest govt report reveals about jobs, wages, and work hours

Jobs paradox

The unemployment rate in India has halved to 3.2% in 2023-24 (July-June) compared to 6.1% in 2017-18, showed a Mint analysis of the government’s Periodic Labour Force Surveys (PLFS). However, the overall figure masks the many challenges in India’s job market, particularly those faced by educated job seekers. The unemployment rate for those with secondary and above education remains elevated at 7.1%, even as it has also come down from 11.4% in 2017-18. This trend has raised questions over the lack of high-quality jobs and opportunities in the formal sector.

Airport addition

29: That is the number of greenfield airports India is planning to build in underserved regions over the next two decades, with an aim to link smaller towns with global air routes, Mint reported. The Airports Authority of India (AAI) has completed feasibility studies for 10 of these airports. Of these, nine will be in Gujarat, followed by Karnataka, Madhya Pradesh and Jharkhand. The government is also planning to upgrade airports in small cities and build second or third airports in metros.

Also Read: In charts: Can alternative proteins be the food of the future?

Cooling off

Home sales and project launches have entered a slow lane, dropping for two consecutive quarters in most metros, Mint reported. Sales dropped by 18% in the July-September period in the top property markets, with an exception of the National Capital Region, according to PropEquity data. Project launches, too, dropped by 11% year-on-year in the same period. Rising prices and delays in approvals have contributed to this slowdown. All eyes are on the upcoming festive season for cues on the property market's revival.

China stimulus

China unleashed sweeping measures earlier this week in its efforts to lift up its ailing economy. The measures include interest rate cuts, allowing banks to lend more, and handouts to the poor. The move comes on the heels of the US Federal Reserve cutting its benchmark rates for the first time since the pandemic. The medium-term lending facility, which is the interest for one-year loans to financial institutions, was cut from 2.3% to 2%, the People's Bank of China said.

Carlyle’s investments

$400 million: That is the investment global private equity (PE) firm Carlyle is planning to make in India's auto components sector, Mint reported. The PE firm is looking to buy at least two parts-makers by the end of 2024-25 and two more in the next 12-18 months. With an eye on securing controlling stakes, the firm is interested in building a portfolio around precision machining and forging components in electric vehicles. This would be Carlyle Group’s second platform in the country after setting up one on generic pharmaceuticals.

Also Read: Why small finance banks want to glide faster into universal banking

SFBs transition

Small finance banks (SFBs) are looking to turn into full-fledged banks, with AU Finance applying for a universal banking licence earlier this month. The Reserve Bank of India's updated criteria, released in April, require a net worth of ₹1,000 crore and gross non-performing assets (NPAs) below 3%, among other conditions. SFBs have seen their deposit base grow, but the pressure on profits prevails, a Mint analysis showed. Seven of the eight listed SFBs had gross NPAs below 3% as of June 2024.

Chart of the week: Alternative proteins

The Indian government in Augustt came out with a new policy that will promote smart proteins that can also help the country in its net-zero emissions journey. Alternative proteins have a lower carbon footprint for the same nutrition, and India is a leading global producer of key plant proteins such as chickpeas, lentils, millets and soybean, among others.

Also Read: Food or Fed: What will RBI choose in October?

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