Indian stock-index futures dropped as benchmark gauges headed for a second weekly loss.
SGX CNX Nifty Index futures for June delivery decreased 0.1 percent to 7,548 at 9:34 a.m. in Singapore. The underlying CNX Nifty Index fell 0.2 percent to 7,540.70 yesterday, while the S&P BSE Sensex (SENSEX) declined 0.2 percent. The benchmark measure has lost 0.1 percent this week, poised for the first consecutive weekly decline since March. The Bank of New York Mellon India ADR Index of U.S.-traded shares slid 0.1 percent.
The Sensex has fallen 1.5 percent since closing at a record on June 10 as rising energy costs and forecasts for weaker-than-average monsoon rains threaten to undermine Prime Minister Narendra Modi’s efforts to curb inflation, and limit the central bank’s scope to ease monetary policy.
“We expect this consolidation phase to extend in the next session as well,” Jayant Manglik, president of retail distribution at Religare Securities Ltd., wrote in an e-mail. “However, any Nifty decline to 7,450 can be considered a buying opportunity.”
The monsoon, which accounts for more than 70 percent of the country’s annual rainfall, was 42 percent lower than a 50-year average since June 1, the India Meteorological Department said on its website yesterday.
Brent crude, the benchmark price for India, climbed to $ 115.06 a barrel yesterday, the highest close since Sept. 6. India imports about 80 percent of the oil it uses.
Share Sales
Shares of Coal India Ltd. (COAL) and NMDC Ltd. (NMDC) may be active. They are among 36 state-owned companies that may need to sell about $ 11 billion of shares after the stock market regulator raised the minimum public holding in government entities.
State-owned companies must increase their public shareholding to at least 25 percent from 10 percent within three years, the Securities & Exchange Board of India said in New Delhi yesterday. That may raise about 650 billion rupees ($ 10.8 billion), according to SMC Global Securities Ltd.
Overseas investors bought a net $ 11.2 million of Indian shares on June 17, taking this year’s inflows to $ 9.92 billion, the most among eight Asian markets tracked by Bloomberg.
The Sensex has advanced 19 percent this year, the largest gain among Asian benchmark indexes. It trades at 15.5 times projected 12-month profits, near the most expensive level since April 2011. The MSCI Emerging Markets Index is valued at multiple of 11.
To contact the reporter on this story: Santanu Chakraborty in Mumbai at schakrabor11@bloomberg.net
To contact the editors responsible for this story: Michael Patterson at mpatterson10@bloomberg.net Matthew Oakley, Phani Varahabhotla