India’s Sensex Swing Between Gains, Loss Ahead of Futures Expiry

Indian (SENSEX) stocks swung between gains and losses after the benchmark index rose to a record closing high yesterday. Derivatives contracts expire today.

DLF Ltd. (DLFU), the nation’s biggest developer, declined to a three-week low after its quarterly net income fell 28 percent. Tractor maker Mahindra & Mahindra Ltd. (MM) dropped for the second day. Sesa Sterlite Ltd. and drugmaker Dr. Reddy’s Laboratories Ltd. (DRRD) gained ahead of their earnings later today.

The S&P BSE Sensex lost less than 0.1 percent to 21,030.67 at 9:40 a.m. in Mumbai, after changing directions at least six times. The gauge has gained 8.6 percent this month, poised for the largest advance since January 2012. It rose to an all-time high yesterday as earnings beat forecasts and amid speculation continued Federal Reserve stimulus will spur capital inflows.

“Some investors would be tempted to book profits given the market has rallied to a record,” Kishor Ostwal, managing director at CNI Research Ltd., said in a phone interview today. “We expect a volatile session as monthly futures expire.”

Global funds bought a net $197 million of local shares on Oct. 29, an 18th day of consecutive purchases, data from the regulator showed yesterday. That extended this year’s inflow to $15.9 billion, the second-highest after Japan among 10 Asian markets tracked by Bloomberg. Quarterly profits at 14 out of 17 Sensex companies that have reported results so far surpassed analyst estimates.

Asian stocks fell today, trimming the best two-month rally for the MSCI Asia Pacific Index since the start of 2012, after a Fed statement yesterday fueled bets it may start paring stimulus sooner than previously forecast, even as it maintained the pace of monthly bond-buying.

The Sensex is the best performer among the four largest emerging markets this year and trades at 14.2 times projected 12-month earnings, compared with the MSCI Emerging Markets Index’s 10.5 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: Michael Patterson at mpatterson10@bloomberg.net

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