India’s Nifty Futures Rise After Index Climbs to Three-Year High

Indian (SENSEX) stock-index futures advanced after the benchmark gauge surged to the highest level in almost three years last week.

SGX CNX Nifty Index futures for October delivery increased 0.4 percent to 6,232.5 at 10:14 a.m. in Singapore. The underlying CNX Nifty (NIFTY) Index on the National Stock Exchange of India Ltd. jumped 2.4 percent to 6,189.35 on Oct. 18, its highest level since Nov. 11, 2010. The S&P BSE Sensex soared 2.3 percent to 20,882.89. The Bank of New York Mellon India ADR Index of U.S.-traded shares added 1 percent to 1,121.76.

The Sensex rallied 1.7 percent last week, its third week of gains, after companies reported earnings that topped estimates and investors speculated capital inflows will accelerate as the U.S. Federal Reserve maintains stimulus. Overseas investors have bought a net $ 1.2 billion of local shares this month, adding to inflows of $ 2 billion in September, data from the market regulator show.

“Fed tapering will likely be delayed and that’s prompting global investors to increase allocations to riskier assets and Indian equities are a beneficiary of that,” Paras Bothra, vice president for equity research at Ashika Stock Broking Ltd., said in an interview on Oct. 18. “Plus, the earnings season has been better than expected.”

Profits at all six Sensex companies that have reported earnings so far this season have beaten or matched estimates. About 47 percent of the 30 Sensex companies missed estimates in the June quarter, versus 27 percent for the March quarter and 43 percent in the three months through December, data compiled by Bloomberg show.

Beating Estimates

Larsen & Toubro Ltd. (LT), India’s largest engineering company, may move. The company said after the market close on Oct. 18 that its second quarter net income fell 14 percent to 9.78 billion rupees ($ 160 million), beating the 8.94 billion rupees estimated by analysts.

Housing Development Finance Corp. (HDFC), the largest mortgage lender, may say today its second-quarter profit rose to 12.5 billion rupees from 11.5 billion rupees a year ago, according the median estimate of 32 analysts in a Bloomberg survey.

The Fed will delay the first reduction in its bond purchases until March after the government shutdown slowed fourth-quarter growth and interrupted the flow of data, economists said.

The Sensex has risen 7.5 percent this year and is valued at 14.2 times estimated 12-month profits, compared with 10.8 times for the MSCI Emerging Markets index.

Global investors bought a net $ 133 million of local stocks on Oct. 17, a 10th straight day of buying and taking this year’s inflows to $ 14.6 billion, data from the regulator show.

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

Enlarge image Trader at a brokerage firm in Mumbai

Trader at a brokerage firm in Mumbai

Trader at a brokerage firm in Mumbai

Prashanth Vishwanathan/Bloomberg

Global investors bought a net $ 133 million of local stocks on Oct. 17, a 10th straight day of buying and taking this year’s inflows to $ 14.6 billion, data from the regulator show.

Global investors bought a net $ 133 million of local stocks on Oct. 17, a 10th straight day of buying and taking this year’s inflows to $ 14.6 billion, data from the regulator show. Photographer: Prashanth Vishwanathan/Bloomberg

SGX Nifty

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