India Nifty Futures Little Changed After Oil Rally, Price Data

Indian stock-index futures were little changed as oil prices rallied on escalating violence in Iraq, countering an improvement in the nation’s industrial output and inflation data.

SGX CNX Nifty Index futures for June delivery declined less than 0.1 percent to 7,665.5 at 10:59 a.m. in Singapore. The underlying CNX Nifty Index on the National Stock Exchange of India Ltd. added 0.3 percent to 7,649.90 yesterday. The S&P BSE Sensex (SENSEX) advanced 0.4 percent. The Bank of New York Mellon India ADR Index of U.S.-traded shares slipped 0.2 percent.

West Texas Intermediate crude headed for the biggest weekly advance since December and Brent climbed as violence in Iraq threatened supplies from the nation. Government data released after the market close yesterday showed consumer prices slowed more than economists projected and factory output expanded in a boost for Prime Minister Narendra Modi’s government ahead of its first budget.

“Flaring up of oil prices have countered the good set of data we had last evening. A slight correction will help cool an already overheated market,” Arun Kejriwal, a director at Kejriwal Research & Investment Pvt., said by phone from Mumbai.

Oil, Monsoon

WTI futures rose as much as 1.1 percent in New York, extending a 2 percent rally yesterday. Militants linked to al-Qaeda, who captured the northern city of Mosul this week, moved south toward Baghdad as Iraqi Oil Minister Abdul Kareem al-Luaibi speculated U.S. planes may bomb the nation’s north. Iraq is the second-largest oil producer in the Organization of Petroleum Exporting Countries.

India’s consumer prices increased 8.28 percent in May from a year earlier, compared with 8.59 percent in April, the Statistics Ministry said yesterday. Industrial output rose 3.4 percent in April, compared with an estimated 1.9 percent gain.

The central bank signaled this month it could ease monetary policy if inflation slows faster than anticipated. Monsoon rains from June to September are forecast to be below normal this year, the weather department said this week, threatening to stoke Asia’s second-fastest inflation.

Prime Minister Modi’s administration has prioritized curbing food costs as part of an agenda that also seeks to revive economic growth from near a decade low.

Valuations, Inflows

Shares of Hero MotoCorp Ltd. (HMCL) may be active today. A unit of Bain Capital, which holds 8.58 percent in the motorcyle maker, will sell shares worth $ 300 million in the company, according to a term sheet obtained by Bloomberg News. The price range for the share sale represents as much as a 5 percent discount to yesterday’s closing price.

The Sensex trades at 15.7 times projected 12-month profits, the most expensive in more than three years, and compares with the MSCI Emerging Markets Index’s multiple of 11. A 21 percent rally this year has pushed the Sensex’s 14-day relative strength index to 76.9, data compiled by Bloomberg show. Some investors see readings above 70 as a signal to sell.

Foreigners have bought a net $ 9.3 billion of local shares this year, the most among eight Asian markets tracked by Bloomberg, on optimism the new government will boost efforts to revive economic growth.

To contact the reporters on this story: Rajhkumar K Shaaw in Mumbai at; Santanu Chakraborty in Mumbai at

To contact the editors responsible for this story: Michael Patterson at Phani Varahabhotla, Richard Frost

SGX Nifty

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