The past week was filled with numerous impactful business decisions and noteworthy news that flooded the markets. From developments concerning LIC and mutual funds to updates on Visatara Airlines and Chinese exporters, along with insights on the European recession, it was an engaging and eventful business week.
In this article, we will be reviewing some of the top business news that dominated the past week-
LIC increases stake in SAIL
In the past week, the Life Insurance Corporation of India (LIC) has increased its stake in several companies. LIC raised its stake in the Steel Authority of India (SAIL) to 8.687% from 6.93%, resulting in notional gains of 25.50% on its holding.
Additionally, LIC raised its stake in Tech Mahindra to 8.88% from 8.07%, while its holdings in Tata Power and Bata India also increased. The increased stake in Tata Power was by 2.08 percentage points, and in Bata India, it rose to 6.532%. LIC acquired shares at average costs of Rs 234.02 and Rs 1,433.54 respectively.
Mutual Fund Investments through SIPs Reach All-Time High in May
Mutual fund investors in India continued to invest through systematic investment plans (SIPs) in May, with monthly inflows reaching an all-time high of Rs 14,749 crore. The total assets managed by the mutual fund industry also reached a record high of Rs 43.2 lakh crore, driven by a net inflow of Rs 45,234 crore in liquid funds.
While equity fund inflows slowed to a six-month low of Rs 3,240 crore, small-cap funds saw the highest flows at Rs 3,283 crore. The number of SIP accounts also reached a new peak of over 6.5 crore. Retail investors maintained their confidence in SIPs for wealth creation.
China’s exports slowdown in May
China’s exports in May declined by 7.5% compared to the previous year, while imports were down by 4.5%, indicating a slowdown in the country’s economic rebound. The weakening global demand, driven by higher interest rates, contributed to the decrease.
Trade weakness, coupled with lower-than-expected retail spending and factory contraction, suggests that China’s economic recovery has slowed since the lifting of COVID-19 restrictions.
Additionally, a government survey revealed a record 1 in 5 young urban workers were unemployed in April. Despite economic growth of 4.5% in Q1 2023, forecasters believe the peak of the rebound has likely passed. China’s trade surplus also narrowed by 16.1% in May.
Eurozone enters technical recession
Recent data reveals that the Eurozone has entered a recession, with its economy contracting by 0.1% in the first quarter of 2023, following a contraction in the previous quarter. Household spending within the bloc declined by 0.3% during the first three months of the year.
Initial estimates had suggested a small expansion of 0.1% for the Eurozone during this period, but updated figures from Eurostat showed a contraction instead. Inflation, defined as a general increase in the price level of goods and services, leads to a decrease in the purchasing power of money.
Canva Expands to Europe with London Headquarters
Australian graphic design company Canva has opened its European headquarters in London, expanding its presence in the region as it competes with industry giants Adobe and Microsoft.
Canva, which offers AI-backed tools for website and content design, believes it is well-positioned to withstand industry challenges due to its profitability, strong cash balance, and affordable pricing. The company has 135 million users globally, with 16% in Europe, and aims to grow its paid subscriber base.
Canva has also introduced AI-powered features, referred to as “magic,” while prioritizing trust and safety. Despite recent setbacks, Canva is optimistic about reaching 1 billion users and becoming a highly valued company.
