India’s benchmark stock index fell, ending a three-day rally before the expiry of the derivatives contracts even as foreign investors added to their holdings of local shares.
The S&P BSE Sensex lost 0.1 percent to 20,147.64, with volume on the gauge about 10 percent below the 30-day average at the close. Sterlite Industries (India) Ltd., the nation’s biggest copper and zinc producer, and State Bank of India, the nation’s largest lender, paced decline among their peers.
The Sensex has risen 3.7 percent in 2013, climbing to the highest in more than two years on May 17, as easing by global central banks stoked inflows into emerging markets. Foreigners have purchased a net $14.8 billion of local shares this year, a record for the period, data compiled by Bloomberg show. Profit at just seven of the 28 firms in the Sensex that have reported March-quarter earnings so far have trailed estimates, compared with 43 percent in the three months ended Dec. 31.
“While a minor fall or rise in the index is normal ahead of the expiry, the underlying trend is positive as fund inflows remain quite strong,” D.K. Aggarwal, chairman of SMC Investments & Advisors Ltd., which has about $100 million in assets, said by phone from New Delhi today. “The macroeconomic data and company profits are expected to improve from here.”
India’s 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. Asia’s third-biggest economy grew 4.5 percent in the previous quarter, the slowest pace since 2009.
Traders rolled over 36 percent of contracts as of May 28, in line with the three-month average of 37 percent for a day before expiry, Edelweiss Securities Ltd. said in a note. Indian derivative contracts end on the final Thursday of every month.
Sterlite tumbled 2.5 percent to 92.45 rupees. Tata Steel Ltd., India’s biggest producer of the alloy, slid 2.3 percent to 314.55 rupees, ending a three-day 7.4 percent gain. Jindal Steel & Power Ltd. lost 2 percent to 300.2 rupees. The S&P BSE India Metal index fell for the first time in four days.
State Bank of India declined 1.1 percent to 2,106.3 rupees. ICICI Bank Ltd., the country’s second-biggest lender, retreated 1.4 percent to 1,214.9 rupees, ending a three-day 5.1 percent rise. The S&P BSE India Bankex index slid for a second day.
Housing Development Finance Corp., the nation’s biggest mortgage lender, lost 1 percent to 910.55 rupees. The stock has advanced 38 percent in the past year, reaching a record May 27.
Sun Pharma Bonus
Sun Pharmaceutical Industries Ltd. soared to a record after India’s most valuable drugmaker reported profit that beat estimates and approved a bonus share issue yesterday after the market closed. The stock surged 7 percent to 1,065.75 rupees, its biggest climb since May 2009.
Tata Motors Ltd. increased 2.7 percent to 303.8 rupees. India’s biggest automaker reported profit that beat estimates as higher sales at its Jaguar Land Rover Ltd. luxury unit offset losses at home. Fourth-quarter net income dropped 37 percent to 39.5 billion rupees, beating the 26.7 billion-rupee median of 41 analysts’ estimates compiled by Bloomberg.
Oil & Natural Gas Corp. rose 0.3 percent to 334.95 rupees. India’s largest state explorer said fourth-quarter profit fell 40 percent to 33.9 billion rupees, missing analyst estimates.
Drugmaker Cipla Ltd. rose 1.4 percent to 401.7 rupees, ending five days of losses. Fourth-quarter net income dropped 8 percent to 2.68 billion rupees, the company said after close of trading hours. That trailed the 3.29 billion rupees estimated by analysts in a Bloomberg survey.
Tata Motors, ONGC and Cipla announced results after the market closed.
The Sensex is valued at 13.9 times projected 12-month profits, compared with the MSCI Emerging Markets Index’s 10.4 times, data compiled by Bloomberg show.
The 50-stock CNX Nifty Index slid 0.1 percent to 6,104.30. Its May futures settled at 6,090.25. India VIX jumped 4.3 percent.