India’s Nifty Futures Rise, Signaling Stocks Will Extend Rebound

Indian (SENSEX) stock-index futures rose, signaling benchmark indexes will extend their biggest daily gain since December 2011.

SGX CNX Nifty Index futures for July delivery rose 0.3 percent to 5,844.5 at 9:38 a.m. in Singapore. The underlying CNX Nifty (NIFTY) Index on the National Stock Exchange of India Ltd. surged 2.8 percent to 5,842.20 on June 28, while the S&P BSE Sensex soared 2.8 percent to 19,395.81. The Bank of New York Mellon India ADR Index of U.S.-traded shares rose 1.1 percent.

Indian stocks, bonds and the rupee rallied on Friday as the government agreed to raise natural gas prices. Gains came after overseas funds pulled $ 139 million from shares on June 27, a 13th day of net sales and the longest stretch of outflows in at least five years, data compiled by Bloomberg show.

“The market move from here will be dependent on foreign inflows, the rupee and the government’s reform measures,” Kishor Ostwal, managing director at CNI Research Ltd., said by phone. “We can see the markets extending gains this week on positive news flow.”

The government on June 27 approved a report by a panel that recommended linking gas prices to global benchmarks. Prices may increase to as much as $ 8 per million British thermal units starting April 1, petroleum secretary Vivek Rae said. That’s almost double the current level.

Stock Valuations

The Sensex has dropped 0.2 percent this year, following a 1.8 percent decline last month and a 3 percent advance for the second quarter. The gauge is valued at 13 times projected 12-month profits, compared with the MSCI Emerging Markets Index’s 9.8 times.

The rupee surged 1.4 percent on June 28 to 59.3900 per dollar in Mumbai, the biggest advance since Sept. 21, 2012. That pared its drop last quarter to 8.6 percent, the largest since the period ended September 2011. The rupee touched a record low of 60.7650 on June 26 after the Federal Reserve’s June 19 signal that the central bank may begin paring asset purchases this year.

Tata Power Co. may be active after Press Trust reported the company increased its tariff in Mumbai by 25 percent, without citing anyone.

Tata Steel Ltd. may move. The Sunday Times reported, citing a person it didn’t identify, that the company plans to raise $ 1.2 billion selling stakes in some affiliated companies and will use the money to repay some of the debt raised for its 2007 purchase of Corus Group.

Overseas Sales

Foreign investors withdrew a net $ 1.76 billion from domestic stocks last month through June 27, the most since the $ 2.1 billion pulled in August 2011, data compiled by Bloomberg show.

Foreigners have been net sellers in only two of the past 13 years, based on data going back to 2000. Inflows last year were $ 24.5 billion, the most among 10 Asian markets tracked by Bloomberg. They climbed to a record $ 29.3 billion in 2010, making the Sensex the best performer among the world’s 10 biggest markets that year. The largest-ever outflow in 2008 amid the global financial crisis triggered the biggest annual slump of 52 percent.

To contact the reporter on this story: Rajhkumar K Shaaw in Mumbai at rshaaw@bloomberg.net

To contact the editor responsible for this story: Michael Patterson at mpatterson10@bloomberg.net

June 27 (Bloomberg) — Kathryn Koch, head of global portfolio solutions international at Goldman Sachs Asset Management, talks about emerging-market and Japan stocks. She speaks in Hong Kong with Rishaad Salamat on Bloomberg Television’s “On the Move.” (Source: Bloomberg)

June 25 (Bloomberg) — Chakravarthy Rangarajan, chairman of Indian Prime Minister Manmohan Singh’s economic advisory council, talks about the nation’s economy, currency and central bank monetary policy. He speaks with Bloomberg TV India’s Vivek Law. (Source: Bloomberg TV India)