Indian stocks fall, metal producers, software exporters decline
Sunday, 27 September 2009
BOMBAY, Sept. 26 (Bloomberg): India's benchmark stock index fell to a week's low, led by commodity producers and software exporters on concern global economic recovery may take longer than expected.
Sterlite Industries (India) Ltd., the nation's No. 1 copper producer, lost 1.2 per cent after the price of the metal slumped in Shanghai, posting a fourth weekly loss, as rising inventories raised speculation that demand is declining. Tata Consultancy Services Ltd. lost 2.5 per cent as the US, software exporters' biggest market, issued disappointing home-sales data.
The Bombay Stock Exchange's Sensitive Index, or Sensex, slipped 88.43, or 0.5 per cent, to 16,693, a 0.3 per cent decline this week. The S&P CNX Nifty Index on the National Stock Exchange fell 0.6 per cent to 4,958.95. The BSE 200 Index retreated 0.3 per cent to 2,051.07.
"Until most variables point toward an economic recovery, there will be some skepticism in the minds of market men as to whether the current rally is sustainable or not," said A.N. Sridhar, a fund manager at Sahara Asset Management Co. in Mumbai.
Sterlite fell 1.2 per cent to 750.25 rupees. December- delivery copper in New York was at $2.725 a pound, down 2.2 per cent this week. Stockpiles in Shanghai have grown to 104,248 tons, the highest since April 2004. Inventories tallied by the London Metal Exchange are at a four-month high.
Hindalco lost 1.8 per cent to 126.7 rupees. Tata Steel Ltd., the largest supplier of the alloy, retreated 2.8 per cent to 498.35 rupees.
The Baltic Dry Index, a gauge of the cost of carrying dry bulk commodities such as iron ore, coal and grain, has almost halved from a June 3 peak as China reduces imports, a sign raw materials demand may be weakening. The Organization for Economic Cooperation and Development predicted a 16 per cent drop in world trade for 2009.
"Weaker global data suggests the rally in metals may be coming to an end," said Alex Mathews, head of research at Geojit BNP Paribas Financial Services Ltd.
Software exporters fell on concern sales may slow in the US, their biggest market. Existing home purchases dropped 2.7 per cent in August to an annual rate of 5.1 million, the National Association of Realtors said yesterday in Washington, compared with a forecast rise to 5.35 million in a Bloomberg survey of 74 economists.
Tata Consultancy lost 2.5 per cent to 587.4 rupees. Infosys Technologies Ltd., the second biggest, declined 1.9 per cent to 2,240.5 rupees. Wipro Ltd., the No. 3, dropped 2.5 per cent to 566.35 rupees. Indian software exporters derive 40 per cent of their earnings from the US
Bharti Airtel Ltd. fell 1.1 per cent to 414.55 rupees after the Economic Times reported, citing unidentified people, that South African officials told Indian policy makers that changes in takeover rules would make it difficult for MTN Group Ltd. to complete its merger with India's biggest mobile phone service provider.
Strides Arcolab Ltd., a medicine maker, rose to its highest in a year during the day's trading after saying it started retail sales of its generic swine flu drug, Starflu. The shares climbed 5.3 per cent to 172.8 rupees, after surging as much as 10 per cent to the highest since Sept. 24, 2008.
"The fourth-quarter results for this company will be great just because of this drug," said Bhawana Verma, a Mumbai-based analyst at KR Choksey Shares & Securities Ltd. who doesn't rate the stock. "The revenue visibility is huge."
India is allowing "regulated" retail sales of drugs used to treat swine flu, formally known as H1N1, which has been attributed to 277 deaths in the world's second-most populous nation. The government is controlling access to treatments to ensure hospital supplies in case of an epidemic.
Meanwhile: Indian bourses underwent a a downward correction after the key indices Sensex and Nifty hit fresh 16-month highs amid hints of caution about stretched valuations and fears of liquidity shortage.
In the week to September 26, the Bombay Stock Exchange 30-share barometer ended at 16,693.00, a net loss of 48.30 points or 0.29 per cent from its last weekend's close.
The 50-share Nifty of the National Stock Exchange also finished the week lower by 17.10 points or 0.34 per cent to 4,958.95 from its previous weekend's close of 4,976.05.
The bellwether Sensex had virtually touched 17K mark while the Nifty crossed the 5,000 psychological level on September 22 on sustained capital inflows.
Though the rollover to October series was quiet healthy and the market technically very strong, investors preferred to be cautious due to stretched valuations..
Sterlite Industries (India) Ltd., the nation's No. 1 copper producer, lost 1.2 per cent after the price of the metal slumped in Shanghai, posting a fourth weekly loss, as rising inventories raised speculation that demand is declining. Tata Consultancy Services Ltd. lost 2.5 per cent as the US, software exporters' biggest market, issued disappointing home-sales data.
The Bombay Stock Exchange's Sensitive Index, or Sensex, slipped 88.43, or 0.5 per cent, to 16,693, a 0.3 per cent decline this week. The S&P CNX Nifty Index on the National Stock Exchange fell 0.6 per cent to 4,958.95. The BSE 200 Index retreated 0.3 per cent to 2,051.07.
"Until most variables point toward an economic recovery, there will be some skepticism in the minds of market men as to whether the current rally is sustainable or not," said A.N. Sridhar, a fund manager at Sahara Asset Management Co. in Mumbai.
Sterlite fell 1.2 per cent to 750.25 rupees. December- delivery copper in New York was at $2.725 a pound, down 2.2 per cent this week. Stockpiles in Shanghai have grown to 104,248 tons, the highest since April 2004. Inventories tallied by the London Metal Exchange are at a four-month high.
Hindalco lost 1.8 per cent to 126.7 rupees. Tata Steel Ltd., the largest supplier of the alloy, retreated 2.8 per cent to 498.35 rupees.
The Baltic Dry Index, a gauge of the cost of carrying dry bulk commodities such as iron ore, coal and grain, has almost halved from a June 3 peak as China reduces imports, a sign raw materials demand may be weakening. The Organization for Economic Cooperation and Development predicted a 16 per cent drop in world trade for 2009.
"Weaker global data suggests the rally in metals may be coming to an end," said Alex Mathews, head of research at Geojit BNP Paribas Financial Services Ltd.
Software exporters fell on concern sales may slow in the US, their biggest market. Existing home purchases dropped 2.7 per cent in August to an annual rate of 5.1 million, the National Association of Realtors said yesterday in Washington, compared with a forecast rise to 5.35 million in a Bloomberg survey of 74 economists.
Tata Consultancy lost 2.5 per cent to 587.4 rupees. Infosys Technologies Ltd., the second biggest, declined 1.9 per cent to 2,240.5 rupees. Wipro Ltd., the No. 3, dropped 2.5 per cent to 566.35 rupees. Indian software exporters derive 40 per cent of their earnings from the US
Bharti Airtel Ltd. fell 1.1 per cent to 414.55 rupees after the Economic Times reported, citing unidentified people, that South African officials told Indian policy makers that changes in takeover rules would make it difficult for MTN Group Ltd. to complete its merger with India's biggest mobile phone service provider.
Strides Arcolab Ltd., a medicine maker, rose to its highest in a year during the day's trading after saying it started retail sales of its generic swine flu drug, Starflu. The shares climbed 5.3 per cent to 172.8 rupees, after surging as much as 10 per cent to the highest since Sept. 24, 2008.
"The fourth-quarter results for this company will be great just because of this drug," said Bhawana Verma, a Mumbai-based analyst at KR Choksey Shares & Securities Ltd. who doesn't rate the stock. "The revenue visibility is huge."
India is allowing "regulated" retail sales of drugs used to treat swine flu, formally known as H1N1, which has been attributed to 277 deaths in the world's second-most populous nation. The government is controlling access to treatments to ensure hospital supplies in case of an epidemic.
Meanwhile: Indian bourses underwent a a downward correction after the key indices Sensex and Nifty hit fresh 16-month highs amid hints of caution about stretched valuations and fears of liquidity shortage.
In the week to September 26, the Bombay Stock Exchange 30-share barometer ended at 16,693.00, a net loss of 48.30 points or 0.29 per cent from its last weekend's close.
The 50-share Nifty of the National Stock Exchange also finished the week lower by 17.10 points or 0.34 per cent to 4,958.95 from its previous weekend's close of 4,976.05.
The bellwether Sensex had virtually touched 17K mark while the Nifty crossed the 5,000 psychological level on September 22 on sustained capital inflows.
Though the rollover to October series was quiet healthy and the market technically very strong, investors preferred to be cautious due to stretched valuations..