India’s Sensex Rebounds From Three-Day Loss; Reliance Advances
Most Indian stocks climbed after a three-day decline in the benchmark index lured some investors. Oil and gas companies led the advance.
The S&P BSE Sensex rose 0.1 percent to 19,568.22 at close in Mumbai, with volume 25 percent less than the 30-day average. Three stocks climbed for every two that retreated. Reliance Industries Ltd. (RIL), owner of the world’s largest refining complex, rallied 2.8 percent, ending a four-day drop. Oil & Natural Gas Corp., the nation’s biggest explorer, climbed for a second day. Sun Pharmaceutical Industries Ltd. (SUNP) added 1.8 percent.
The Sensex slid to a more than one-month low yesterday amid concern that the nation’s slowing economic growth would prompt foreign funds to pare their holdings. The drop dragged the Sensex’s valuation to 13.48 times projected 12-month profits yesterday, the lowest reading in more than five weeks.
“The markets have been suppressed continuously for few days and is looking reasonable on a price-to-earnings basis,” Chokkalingam G, chief investment officer with Centrum Wealth Management Ltd. in Mumbai, told Bloomberg TV India today. “We have hit a short-term bottom and should recover from here.”
Foreign funds have bought a net $15.2 billion of Indian (SENSEX) equities this year, the second-highest among 10 Asian markets tracked by Bloomberg, even as government data showed May 31 the economy grew a decade-low 5 percent in the year ended March and a separate report June 3 showed factory output in May fell to a 50-month low.
Reliance increased 2.8 percent to 802 rupees, ending a four-day, 8 percent drop. The stock has the second-highest weighting in the Sensex. Oil & Natural Gas gained 2 percent to 324.6 rupees, the most since May 28.
Sun Pharmaceutical advanced 1.8 percent to 1,037 rupees. Maruti Suzuki India Ltd. (MSIL) added 1.4 percent to 1,568.3 rupees, the most since May 24, ending three days of losses. HDFC Bank Ltd. (HDFCB), the second-biggest private lender, added 0.7 percent to 687.95 rupees.
The Sensex has slumped 3.5 percent since reaching a more than two-year high on May 17, paring its gain for the year to 0.7 percent. The gauge’s 14-day relative strength index was at 44.8, near the lowest level since April 15.
The 50-stock CNX Nifty Index (NIFTY) on the National Stock Exchange of India Ltd. rose 0.1 percent to 5,923.85. Its June futures settled at 5,944.90. India VIX, which gauges the cost of protection against losses in the Nifty, dropped 2.8 percent.
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