Indian stock-index futures gained after the rupee capped its biggest four-day gain in at least 40 years and oil prices declined.
SGX CNX Nifty Index futures for September delivery rose 0.2 percent to 5,921.5 at 9:53 a.m. in Singapore. The underlying CNX Nifty (NIFTY) Index climbed 3.8 percent to 5,896.75 yesterday, the biggest gain since May 2009. The S&P BSE Sensex jumped 3.8 percent. The Bank of New York Mellon India ADR Index of U.S.- traded shares increased 2.8 percent. The rupee gained 2.2 percent to 63.84 per dollar yesterday, while one-month rupee forwards added 0.4 percent to 64.42 today. Brent crude dropped 2.2 percent yesterday, the biggest loss since June 20.
The rupee rose 6.1 percent in the past four days, the biggest gain since at least 1973, as U.S. jobs data that fell short of estimates tempered concern the Federal Reserve will cut stimulus this month. Falling crude prices and a strengthening currency cut import costs for a nation that buys about 80 percent of its crude from overseas. Oil imports jumped 18 percent from a year earlier to $15.1 billion in August, according to data from the Trade Ministry yesterday.
“There is a sense of euphoria triggered by the rupee again and the drop in crude oil prices,” Gajendra Nagpal, chief executive officer at New Delhi-based Unicon Financial Intermediaries Ltd., said by phone.
The Indian gauge’s 30-day volatility index, a measure of price swings, rose to 30.4 yesterday, the highest level since August 2009.
The MSCI Asia Pacific Index extended its longest winning streak this year as the U.S. Senate backed away from a vote authorizing a military strike against Syria.
India’s trade deficit narrowed to $10.9 billion in August, from $14.2 billion a year earlier, according to provisional data from the Trade Ministry yesterday. Imports shrank 0.7 percent to $37.1 billion and exports jumped 13 percent to $26.1 billion.
The Sensex and the rupee have also surged in the past week after new Reserve Bank of India Governor Raghuram Rajan announced plans to boost the financial sector and support the rupee, which has dropped 16 percent this year.
Overseas investors bought a net $194 million of domestic shares on Sept. 6, data from the regulator showed yesterday. That boosted last week’s inflow to $344 million, the most since the week ended May 31.
Foreign investors have bought a net $11.6 billion of Indian (SENSEX) shares this year, the second-highest among 10 Asian markets tracked by Bloomberg. They pulled $3.7 billion from local equities in the three months to Aug. 31 as capital fled emerging markets amid prospects of the Federal Reserve paring its record stimulus.
The Sensex has increased 2.9 percent this year in local currency terms and is valued at 14.2 times projected 12-month earnings. It has lost 12 percent this year in dollar terms. The MSCI Emerging Markets Index is valued at 10.5 times.
To contact the reporter on this story: Santanu Chakraborty in Mumbai at firstname.lastname@example.org