Posted on July 4, 2013, Thursday
MUMBAI: Indian (Sensex) stock-index futures fell, signalling equities may extend their biggest drop in a week, as oil rose above US$ 100 a barrel for the first time since September.
The Sensex dropped on Tuesday by the most since June 24 after a three-day rally drove its valuation to a three-week high.
The jump in West Texas Intermediate (WTI) crude may stoke investor concerns over inflation in a country that buys about 80 per cent of its oil from overseas.
Higher oil and gold prices helped boost India’s current-account deficit to a record 6.7 per cent of gross domestic product in the fourth quarter.
“The Reserve Bank of India may need to shift focus back on inflation management from reviving economic growth if things worsen,” Rajendra Wadher, a director at PRB Securities Ltd, said in a phone interview yesterday.
WTI futures surged as much as 2.4 per cent in after-hours trading on Tuesday to US$ 102.02 a barrel as a political showdown in Egypt escalated, bolstering concern Middle East oil shipments may be disrupted.
India’s current-account deficit narrowed last quarter to 3.6 per cent of GDP.
HSBC Holdings PLC and Markit Economics are due to release a June purchasing managers’ index for the nation’s services industry.
The May reading was 53.6, above the level of 50 that signals growth. The Sensex has fallen 4.1 per cent from a two-year high on May 17, as the prospect of reduced US monetary stimulus prompted investors to pull money from emerging-market assets. — Bloomberg
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