Indian (SENSEX) stock-index futures dropped after benchmark indexes climbed to a two-week high yesterday.
SGX CNX Nifty Index futures for November delivery fell 0.3 percent to 6,214 at 10:18 a.m. in Singapore. The underlying CNX Nifty (NIFTY) Index gained 0.2 percent to 6,203.35 yesterday, the highest close since Nov. 6. The S&P BSE Sensex also increased 0.2 percent. The Bank of New York Mellon India ADR Index of U.S.-traded shares declined for the first time in five days, losing 1.6 percent.
Indian policy makers are grappling with the fastest inflation among 17 Asia-Pacific economies tracked by Bloomberg and an economy forecast to grow at the slowest pace in more than a decade this fiscal year. A three-month, $ 5.67-billion surge of international money into Indian stocks has helped the Sensex rally 17 percent since slumping to a one-year low in August.
“Weak local macros will continue to counter strong liquidity flows,” Suhas Naik, chief operating officer at Mumbai-based IL&FS Portfolio Management Services Ltd., which oversees $ 100 million in assets, said by phone yesterday. “The markets will continue to be volatile in the near term.”
The MSCI Asia Pacific Index swung between gains and losses today after Federal Reserve Chairman Ben S. Bernanke said low U.S. interest rates will continue long after the central bank ends its program of bond buying.
International investors bought a net $ 142.5 million of local shares on Nov. 18, a 30th straight day of purchases and the longest consecutive inflow since the 35 days through Feb. 15, according to data from the market regulator.
Foreign funds have bought $ 17.1 billion of Indian stocks this year, the second-highest inflow after Japan among 10 Asian markets tracked by Bloomberg.
The Sensex has gained 7.5 percent this year and trades at 13.7 times projected 12-month profits, compared with the MSCI Emerging Markets Index’s 10.7 times.
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