India's stocks fall
Thursday, 24 September 2009
MUMBAI, Sept 23 (Bloomberg): India's benchmark stock index fell for the first time in six days, led by road builder Jaiprakash Associates Ltd. and wind turbine maker Suzlon Energy Ltd., after they sold shares for a combined $391 million.
Jaiprakash lost the most in more than a month after raising 11.9 billion rupees ($249 million). Suzlon posted its biggest drop since Aug. 10 after selling 6.78 billion rupees of stock. Bharti Airtel Ltd., the largest mobile phone operator, sank 3.5 per cent as the Economic Times said its deal to combine with South Africa's MTN Group Ltd. may face regulatory hurdles.
The Bombay Stock Exchange's Sensitive Index, or Sensex, fell 166.93, or 1 per cent, to 16,719.50. The S&P CNX Nifty Index on the National Stock Exchange retreated 1 per cent to 4,969.95. The BSE 200 Index dropped 1 per cent to 2,048.63.
"If people have to sell something to make space for new issues then the secondary market can expect to see some amount of selling pressure," said Prateek Agrawal, a fund manager in Mumbai with Bharti Axa Investment Managers Pvt. "New issues affect the secondary market because cash on the sidelines is reduced considerably."
Jaiprakash lost 6.2 per cent to 234.3 rupees. The construction company sold 50 million shares for 238.46 rupees apiece, according to a person familiar with the matter, who declined to be identified before an official announcement.
Suzlon declined 6.2 per cent to 94.6 rupees as India's biggest maker of wind turbine generators sold 70 million shares for 96.85 rupees apiece, according to a person familiar with the sale, who declined to be named.
Cipla Ltd., India's second-biggest drugmaker by market value, fell 1.7 per cent to 259.85 rupees after it raised $140 million selling shares to institutional investors, four people familiar with the matter said.
The company sold the shares at 263.75 rupees apiece, the people said, declining to be identified as they aren't authorized to speak to the media. The company plans to use the proceeds for "capacity expansion," Cipla Chief Executive Officer Amar Lulla said by phone. He declined to confirm the sale amount.
Bharti Airtel Ltd., India's biggest mobile phone service provider, retreated after the Economic Times said its deal to combine with South Africa's MTN Group Ltd. may face hurdles due to changes in the regulator's takeover rules. Bharti declined 3.5 per cent to 413.5 rupees.
The Securities and Exchange Board of India said late yesterday it will require holders of American and global depositary receipts with voting rights to comply with the nation's takeover rules. The structure of Bharti's transaction will comply with the rules of both India and South Africa, Chief Executive Officer Manoj Kohli said in an interview today.
Shares also fell as some investors judged recent gains as excessive. The Sensex's 14-day relative strength index, which measures how rapidly the measure rose or fell during the specified period, had been above 70 for the previous four trading sessions. Some investors regard this level as a signal to sell.
"The short-term indicators, like the 14-day RSI, are in over-bought territory," said Alex Mathews, head of research at Geojit BNP Paribas Financial Services Ltd.
Tata Consultancy Services Ltd., the No. 1 software services provider, lost 2 per cent to 590.9 rupees. Its RSI was above 70 for the past three sessions.
Infosys Technologies Ltd., the second-largest software services provider, lost 1.8 per cent to 2,366.95 rupees. Its RSI was above 70 for the past four sessions.
Ranbaxy Laboratories Ltd., India's third-biggest drugmaker by market value, gained 1.1 per cent to 383.55 rupees. The company has launched a bid to supply the government with 10 million doses of Tamiflu, a drug used to treat the H1N1 human swine flu virus, the Economic Times reported without saying where it got the information.
Jaiprakash lost the most in more than a month after raising 11.9 billion rupees ($249 million). Suzlon posted its biggest drop since Aug. 10 after selling 6.78 billion rupees of stock. Bharti Airtel Ltd., the largest mobile phone operator, sank 3.5 per cent as the Economic Times said its deal to combine with South Africa's MTN Group Ltd. may face regulatory hurdles.
The Bombay Stock Exchange's Sensitive Index, or Sensex, fell 166.93, or 1 per cent, to 16,719.50. The S&P CNX Nifty Index on the National Stock Exchange retreated 1 per cent to 4,969.95. The BSE 200 Index dropped 1 per cent to 2,048.63.
"If people have to sell something to make space for new issues then the secondary market can expect to see some amount of selling pressure," said Prateek Agrawal, a fund manager in Mumbai with Bharti Axa Investment Managers Pvt. "New issues affect the secondary market because cash on the sidelines is reduced considerably."
Jaiprakash lost 6.2 per cent to 234.3 rupees. The construction company sold 50 million shares for 238.46 rupees apiece, according to a person familiar with the matter, who declined to be identified before an official announcement.
Suzlon declined 6.2 per cent to 94.6 rupees as India's biggest maker of wind turbine generators sold 70 million shares for 96.85 rupees apiece, according to a person familiar with the sale, who declined to be named.
Cipla Ltd., India's second-biggest drugmaker by market value, fell 1.7 per cent to 259.85 rupees after it raised $140 million selling shares to institutional investors, four people familiar with the matter said.
The company sold the shares at 263.75 rupees apiece, the people said, declining to be identified as they aren't authorized to speak to the media. The company plans to use the proceeds for "capacity expansion," Cipla Chief Executive Officer Amar Lulla said by phone. He declined to confirm the sale amount.
Bharti Airtel Ltd., India's biggest mobile phone service provider, retreated after the Economic Times said its deal to combine with South Africa's MTN Group Ltd. may face hurdles due to changes in the regulator's takeover rules. Bharti declined 3.5 per cent to 413.5 rupees.
The Securities and Exchange Board of India said late yesterday it will require holders of American and global depositary receipts with voting rights to comply with the nation's takeover rules. The structure of Bharti's transaction will comply with the rules of both India and South Africa, Chief Executive Officer Manoj Kohli said in an interview today.
Shares also fell as some investors judged recent gains as excessive. The Sensex's 14-day relative strength index, which measures how rapidly the measure rose or fell during the specified period, had been above 70 for the previous four trading sessions. Some investors regard this level as a signal to sell.
"The short-term indicators, like the 14-day RSI, are in over-bought territory," said Alex Mathews, head of research at Geojit BNP Paribas Financial Services Ltd.
Tata Consultancy Services Ltd., the No. 1 software services provider, lost 2 per cent to 590.9 rupees. Its RSI was above 70 for the past three sessions.
Infosys Technologies Ltd., the second-largest software services provider, lost 1.8 per cent to 2,366.95 rupees. Its RSI was above 70 for the past four sessions.
Ranbaxy Laboratories Ltd., India's third-biggest drugmaker by market value, gained 1.1 per cent to 383.55 rupees. The company has launched a bid to supply the government with 10 million doses of Tamiflu, a drug used to treat the H1N1 human swine flu virus, the Economic Times reported without saying where it got the information.