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Indian Nifty Futures Drop Before Derivatives Expiry, Growth Data

Indian stock-index futures dropped before the expiry of derivatives contracts and the release of economic growth data this week.

SGX CNX Nifty Index futures for May delivery fell 0.2 percent to 6,097 at 9:48 a.m. in Singapore. The contract expires tomorrow. The underlying CNX Nifty (NIFTY) Index rose 0.5 percent to 6,111.25 yesterday. The S&P BSE Sensex climbed 0.7 percent. The Bank of New York Mellon India ADR Index of U.S.-traded shares jumped 2.1 percent, the biggest gain since April 30.

Gross domestic product increased 4.8 percent in the three months through March, according to the median of 33 estimates in a Bloomberg survey before data due May 31. The Indian economy grew 4.5 percent in the previous quarter, the slowest pace since 2009. The Sensex’s 15-day volatility, a gauge of price swings, rose to 19.9 yesterday, the highest level in more than a year.

“We expect a volatile trading session today ahead of the expiry of the monthly derivatives contract,” Kishor Ostwal, managing director of CNI Research (India) Ltd., said by phone today. “Liquidity is strong and corporate earnings have been better-than-expected so far, which limits the downside.”

Foreign investors bought a net $69.7 million of Indian (SENSEX) stocks on May 27, taking this year’s inflows to $14.6 billion, a record for the period according to data compiled by Bloomberg. Profits at just five of the 25 companies in the benchmark gauge that have reported March-quarter earnings so far have trailed estimates, compared with 43 percent in the three months ended Dec. 31, data compiled by Bloomberg show.

Tata Motors

Shares of Tata Motors Ltd. (TTMT), India’s biggest automaker, may be active on concerns its Indian operations may report a record loss. The company may say today that group profit slumped 57 percent in the quarter ended March 30, according to the median estimate of 40 analysts surveyed by Bloomberg.

Oil & Natural Gas Corp. (ONGC), India’s largest state-owned oil explorer, may say its fourth-quarter profit fell 13 percent to 49.3 billion rupees ($881 million), according to the median estimate of 36 analysts in a Bloomberg survey.

Drugmaker Cipla Ltd. (CIPLA) may report a 13 percent increase in quarterly net income, according to 32 analysts in a Bloomberg survey.

Sun Pharmaceutical Industries Ltd. (SUNP), India’s most valuable drugmaker, may move after net income rose 23 percent to 10.1 billion rupees, beating the 9.17 billion-rupee median forecast.

Hindalco Industries Ltd. (HNDL), India’s second-largest aluminum producer, reported net income fell 25 percent to 4.82 billion rupees, still beating the 3.87 billion rupees estimated by analysts in a Bloomberg survey.

The Sensex has risen 3.8 percent in 2013, climbing to the highest in more than two years on May 17, as monetary easing by central banks from Europe to the U.S. and Japan stoked inflows into emerging markets. The gauge is valued at 13.9 times projected 12-month profits, compared with the MSCI Emerging Markets Index’s 10.4 times.

To contact the reporter on this story: Rajhkumar K Shaaw in Mumbai at rshaaw@bloomberg.net

To contact the editor responsible for this story: Darren Boey at dboey@bloomberg.net

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