Latest news with #Nomura
Bloomberg
3 hours ago
- Business
- Bloomberg
Rest of the Year Will Be Eventful But Still Profitable for Equities: Nomura
Nomura's Gareth Nicholson says "we expect to see some headwinds for equities over the next few weeks but that's short term." Nicholson tells Bloomberg Television that earnings show the current corporate framework in this environment has been working. He also says the rest of the year will be eventful "but still profitable." (Source: Bloomberg)
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First Post
4 hours ago
- Business
- First Post
Trump's 25% tariff on India could drag down GDP growth by 50-60 basis points, say analysts
US President Donald Trumps' 25% tariff on India could slash India's projected GDP growth by 50-60 basis points, dragging it below the 6%-mark. Currently, the Reserve Bank has projected the GDP growth for this year at 6.5%. read more US President Donald Trump and Prime Minister Narendra Modi shake hands as they attend a joint press conference at the White House in Washington, on, February 13. Reuters US President Donald Trump could deliver a hit of 50-60 basis points to the Indian GDP growth with tariffs and penalties, according to analysts. Trump on Thursday formally imposed 25 per cent tariff on India. He has also previously threatened additional penalties over India's trade with Russia. Previously, the Reserve Bank of India (RBI) had projected the Indian economy to grow at 6.5 per cent in 2025-26. The Union Finance Ministry had projected the economy to grow in the 6.3-6.8 per cent range. STORY CONTINUES BELOW THIS AD With Trump's 25 per cent tariff, and any additional penalties, the GDP growth could fall to 6.1 per cent and even below the 6 per cent-mark, as per analysts. Trump's tariff could slash GDP growth by 50-60 basis points, exports by 12.5% The State Bank of India (SBI) has said that a 20 per cent tariff could slash as much as 50 basis points (0.5 per cent) from India's GDP, according to CNBC-TV18. At 25 per cent tariff, this would mean a cut of around 62 basis points, dragging down India's GDP growth to around 5.87 per cent. The SBI study further said that any 1 per cent rise in tariff may lead to a 0.5 per cent decline in export volumes'. At 25 per cent tariff, this would mean 12.5 per cent decline in export volume. This could have massive implications for the Indian economy as the United States in India's largest export destination. Other analysts said that the tariff's effect could be in the range of 40-50 basis points. ANZ economists Dhiraj Nim and Sanjay Mathur said if 25 per cent tariff remained in place for the remainder of 2025-26, 'it could subtract 40 basis point from GDP growth', according to The Indian Express. Separately, Barclays has projected a hit of 30 basis points and Nomura has projected a hit of 20 basis points. 'Taking into account the sectoral exemptions, we estimate the effective tariff rate (for India) at ~20 per cent. The announced reciprocal tariff rate of 25 per cent, however, may be temporary, and might settle lower, as negotiations will continue after August 1. However, the best-case outcome would still be tariffs in the 15-20 per cent range, which is disappointing, considering India's more advanced stage of negotiations,' noted Nomura, as per Financial Express. STORY CONTINUES BELOW THIS AD
Sydney Morning Herald
5 hours ago
- Business
- Sydney Morning Herald
How a $155 billion ‘eco-paradise' fell short of its promise
At 9am, the beachfront was empty, except for a Malaysian couple and their grandson playing near a white concrete staircase jutting out over the sand. Dubbed the 'stairway to heaven', it's intended to be an Instagrammable spot, but it's difficult to pass over its metaphor as a boondoggle leading nowhere. While waiting to check in, I wandered the grounds for five hours, encountering maybe 20 visitors or residents. This paucity contrasted with the number of groundskeepers, maintenance workers and security staff roaming the facility, ensuring every fallen leaf was swept, hedge trimmed and pool sparkling to maintain the vision of a safe and immaculate paradise. At the centre of the estate, an entire building has been dedicated to selling this dream. A large-scale model of the project spans the length of a salesroom floor, capturing the grandeur of the four-island plan spanning 14 square kilometres that seems destined to remain a fantasy. A promotional video playing in the background claims the city is home to 15,000 residents and 'gradually growing'. By midmorning, a few Chinese buyers were flipping through brochures, outnumbered by staff ready to lock in a sale. From the outset, Country Garden gambled the success of its venture on the burgeoning Chinese middle class' seemingly insatiable appetite for real estate. It pitched Forest City as a way for Chinese investors to diversify their assets offshore, while dangling visa incentives and the prospect of residency in Malaysia. It has proved a bad bet. In 2020, Chinese President Xi Jinping began cracking down on the credit binge that the country's heavily leveraged developers had gorged on, setting in train a property-bubble bust that has wiped out wealth and confidence. Across China, cities are now littered with the abandoned ambitions of its developers, many of them falling into ruin. Country Garden has more than 3000 unfinished projects and nearly 1 million outstanding homes to complete, according to Japanese investment bank Nomura. It did not respond to a request for comment. Forest City has also suffered from lingering resentment in Malaysia at the idea of a massive project being built for Chinese buyers. This was fuelled by then-prime minister Mahathir Mohamad, who in 2018 said foreigners would not be granted visas to live there, further dampening demand. Visa controls have since been eased under current Prime Minister Anwar Ibrahim. Even with price decreases – a one-bedroom apartment starts at 500,000 Malaysian ringgit ($182,190) – Forest City is unaffordable for many locals and remains pitched at overseas buyers. Forest City may not be the total ghost town it's pegged as by the press, but it's far from the portrait of a vibrant, thriving community. At midday, many of the shops in the mall next to the hotel were still shuttered, some seemingly permanently. Those that were open had no customers, and bored shop assistants sat glued to their phones at vacant counters. At one coffee shop, the server was slumped across a table, asleep. A prime selling point for Forest City is its duty-free status. But a licensing issue meant none of the four duty-free shops in the mall were selling alcohol − one of the main drawcards for visitors, especially those from Singapore, where extortionate taxes make a tipple all but a luxury. One store was reduced to selling only chocolates, though upon entry its shelves were bare save for several boxes of wafer biscuits − a sales challenge that apparently required two shop assistants. One of them, a woman in her 40s, said she had lived in Forest City with her children for four years in an apartment tower behind the mall, having relocated from Kuala Lumpur. 'There are many people who live in my tower,' she says, explaining that most of them were Malaysian renters who commuted into Singapore daily for work. 'I like it here. It's very quiet.' By sundown, foot traffic has picked up. A modest number of people have filtered onto the beach and a volleyball game is under way. The hotel seems reasonably buzzy, due partly to the fact that a tech school, led by US cryptocurrency investor Balaji Srinivasan, has set up shop in the lobby. There are signs of life in towers, too, as lights begin flickering on in some of the apartments, though many remain dark. Country Garden isn't the only stakeholder banking on Forest City's future. Malaysian company Esplanade Danga 88, backed by the state's Sultan Ibrahim Iskandar, has a 40 per cent stake. Recently, the Malaysian government has ramped up its incentives to lure wealthy investors to the project, including offering a 0 per cent tax rate for those who set up family offices in Forest City. For now, it's quite something to climb the 'staircase to heaven' and peer back at the shore and marvel at the sheer scale of Forest City − its unbridled ambition, unfulfilled promise and uncertain future.
The Age
5 hours ago
- Business
- The Age
How a $155 billion ‘eco-paradise' fell short of its promise
At 9am, the beachfront was empty, except for a Malaysian couple and their grandson playing near a white concrete staircase jutting out over the sand. Dubbed the 'stairway to heaven', it's intended to be an Instagrammable spot, but it's difficult to pass over its metaphor as a boondoggle leading nowhere. While waiting to check in, I wandered the grounds for five hours, encountering maybe 20 visitors or residents. This paucity contrasted with the number of groundskeepers, maintenance workers and security staff roaming the facility, ensuring every fallen leaf was swept, hedge trimmed and pool sparkling to maintain the vision of a safe and immaculate paradise. At the centre of the estate, an entire building has been dedicated to selling this dream. A large-scale model of the project spans the length of a salesroom floor, capturing the grandeur of the four-island plan spanning 14 square kilometres that seems destined to remain a fantasy. A promotional video playing in the background claims the city is home to 15,000 residents and 'gradually growing'. By midmorning, a few Chinese buyers were flipping through brochures, outnumbered by staff ready to lock in a sale. From the outset, Country Garden gambled the success of its venture on the burgeoning Chinese middle class' seemingly insatiable appetite for real estate. It pitched Forest City as a way for Chinese investors to diversify their assets offshore, while dangling visa incentives and the prospect of residency in Malaysia. It has proved a bad bet. In 2020, Chinese President Xi Jinping began cracking down on the credit binge that the country's heavily leveraged developers had gorged on, setting in train a property-bubble bust that has wiped out wealth and confidence. Across China, cities are now littered with the abandoned ambitions of its developers, many of them falling into ruin. Country Garden has more than 3000 unfinished projects and nearly 1 million outstanding homes to complete, according to Japanese investment bank Nomura. It did not respond to a request for comment. Forest City has also suffered from lingering resentment in Malaysia at the idea of a massive project being built for Chinese buyers. This was fuelled by then-prime minister Mahathir Mohamad, who in 2018 said foreigners would not be granted visas to live there, further dampening demand. Visa controls have since been eased under current Prime Minister Anwar Ibrahim. Even with price decreases – a one-bedroom apartment starts at 500,000 Malaysian ringgit ($182,190) – Forest City is unaffordable for many locals and remains pitched at overseas buyers. Forest City may not be the total ghost town it's pegged as by the press, but it's far from the portrait of a vibrant, thriving community. At midday, many of the shops in the mall next to the hotel were still shuttered, some seemingly permanently. Those that were open had no customers, and bored shop assistants sat glued to their phones at vacant counters. At one coffee shop, the server was slumped across a table, asleep. A prime selling point for Forest City is its duty-free status. But a licensing issue meant none of the four duty-free shops in the mall were selling alcohol − one of the main drawcards for visitors, especially those from Singapore, where extortionate taxes make a tipple all but a luxury. One store was reduced to selling only chocolates, though upon entry its shelves were bare save for several boxes of wafer biscuits − a sales challenge that apparently required two shop assistants. One of them, a woman in her 40s, said she had lived in Forest City with her children for four years in an apartment tower behind the mall, having relocated from Kuala Lumpur. 'There are many people who live in my tower,' she says, explaining that most of them were Malaysian renters who commuted into Singapore daily for work. 'I like it here. It's very quiet.' By sundown, foot traffic has picked up. A modest number of people have filtered onto the beach and a volleyball game is under way. The hotel seems reasonably buzzy, due partly to the fact that a tech school, led by US cryptocurrency investor Balaji Srinivasan, has set up shop in the lobby. There are signs of life in towers, too, as lights begin flickering on in some of the apartments, though many remain dark. Country Garden isn't the only stakeholder banking on Forest City's future. Malaysian company Esplanade Danga 88, backed by the state's Sultan Ibrahim Iskandar, has a 40 per cent stake. Recently, the Malaysian government has ramped up its incentives to lure wealthy investors to the project, including offering a 0 per cent tax rate for those who set up family offices in Forest City. For now, it's quite something to climb the 'staircase to heaven' and peer back at the shore and marvel at the sheer scale of Forest City − its unbridled ambition, unfulfilled promise and uncertain future.
New Indian Express
17 hours ago
- Business
- New Indian Express
US tariff could shave 20-30 bps off India's growth this fiscal, say economists
MUMBAI: The higher-than-anticipated 25% tariff on Indian exports to the US is a 20-30 bps downside risk to the growth forecast this fiscal unless the ongoing trade talks bring it down, say economists. On Wednesday night, US President Donald Trump unexpectedly announced a 25% flat tariff on Indian goods from August 1, with an unspecified 'additional penalty' for India's energy and military purchases from Russia. While economists at the British brokerage Barclays put the tariff impact on growth at 30 bps this fiscal, the RBI has pegged it at 6.5%, while foreign agencies like the IMF and the Asian Development Bank have pegged it marginally lower at 6.4% and 6.5% respectively. 'Taking into account the sectoral exemptions, we estimate the effective tariff rate at 20% and this will be a 20 bps downside risk to the growth forecast for this fiscal,' Japanese brokerage Nomura Securities economists Sonal Varma and Aurodeep Nandi said Thursday. The 25% tariff, plus a penalty on Russian imports, could dent growth by 30 bps this fiscal, but the higher duty is unlikely to significantly affect the domestic demand-driven economy, said Barclays. If the 25% tariff is implemented, the effective average US tariff on Indian goods will rise to 20.6% in trade-weighted terms, Barclays said, adding this is sharply higher than both the pre 'liberation day' tariff rate of 2.7% and the 90-day pause tariff rate of 11.6%. In contrast, India's import tariff on US goods is lower, at 11.6% in trade-weighted terms. "We do not see the tariff threat impacting GDP growth meaningfully, at worst the impact is 30 bps. We expect final tariffs to settle in lower than 25%, as trade talks are on," the British brokerage said further. The announced reciprocal tariff rate of 25% may be temporary and settle lower as negotiations will continue after August 1. However, the best-case outcome will still be a tariff in the 15-20% range, which is disappointing, considering India's more advanced stage of negotiations, Nomura said, adding, 'We maintain our FY26 GDP growth forecast at 6.2% but flag a downside risk of 20 bps. Exports to the US account for just 2.2% of the GDP, and include pharma, smartphones, gems & jewellery, industrial machinery, auto components, textiles and iron & steel; most of which will likely face margin pressure.' With Vietnam facing a 20% tariff, India's tariff of 25%, or even 15% in the best case scenario, may not lead to major trade diversion opportunities in the near-term. But over the medium-term, India is expected to remain a beneficiary of the China plus one strategy as diversification is a bigger driver of this trend, Nomura said. Echoing similar views, Moody's Analytics associate economist Aditi Raman said while the US is India's largest trade partner with 18% of total exports shipped into that market or 2.2% of the GDP, the economy is relatively more domestically oriented than most of the region and relies far less on trade. "Pharmaceuticals, gems, and textiles are key sectors that are likely to be hit. A point of contention is market access to the key agricultural and dairy sector, which India has historically been reluctant to grant," Raman said. In 2024, Indian exports to the US amounted to $80.8 billion, representing about 18% of total exports. Pharmaceuticals, gems and textiles are key sectors that stand to suffer should a 25% tariff get locked in. That said, the Indian economy is more domestically oriented than most in the region and relies far less on trade. Top exports to the US, including electrical machinery ($12 billion, including smartphones), and gems & jewellery ($9 billion), now face tariff increases of just over 24 percentage points, compared with levels before April 2.
