Indian Equities Post Worst Week Since 2009 as Bears Hug Sensex

  • Bharat Heavy, Oil & Natural Gas tumble as earnings disappoint
  • Foreign investors have pulled $2 billion from India this year

Indian stocks swung between gains and losses, with the benchmark gauge capping its biggest weekly loss in more than six years after it entered a bear market Thursday.

Bharat Heavy Electricals Ltd., the top power-equipment maker, plunged the most since August 2013 after posting a surprise loss. Oil & Natural Gas Corp. tumbled to a seven-year low after reporting a second quarterly drop in net income. Sun Pharmaceutical Industries Ltd. gained after its profit exceeded estimates. Mahindra & Mahindra Ltd. rose the most in three weeks. Bharti Airtel Ltd. was the only stock on the S&P BSE Sensex to rise this week.

The Sensex added 0.2 percent at the close, extending the week’s loss to 6.6 percent, the steepest since the period ended July 10, 2009. Volumes on the NSE Nifty 50 Index were 67 percent more than the 30-day average. The Sensex tumbled into a bear market Thursday, joining benchmarks from Tokyo to Frankfurt, after tumbling 23 percent from its January 2015 record. Global funds have pulled $2.1 billion from local shares this year as investors turn averse to riskier emerging-market assets.

“There are risks in the global market and with the rupee depreciating fast, a selloff is possible,” A. K. Prabhakar, head of research at IDBI Capital Capital Market Services Ltd., said in an interview with Bloomberg TV India. “Don’t be in a hurry to buy stocks.”

The rupee gained 0.1 percent to 68.2350 per dollar after earlier falling close to its record low of 68.8450 touched in August 2013.

Globally equity markets rebounded after a torrid week when investors questioned whether central banks have the tools to shore up the global economy. Federal Reserve Chair Janet Yellen in a second day of testimony said the Fed was assessing the impact of the swings in the markets on the economy but she doubted that would prompt it to reverse course and cut rates. Investors will be watching U.S. data on retail sales and consumer confidence to gauge how America is weathering the global slowdown.

Oil & Natural Gas tumbled 4.9 percent to 193.3 rupees, its lowest level since March 2009. The company reported after trading ended Thursday its lowest quarterly profit in more than 15 years following the slump in crude prices. Bhel plunged 13 percent to its lowest level since August 2013. The stock has lost 38 percent of its value this year.

Sun Pharmaceutical added 2 percent. Net income for the quarter ended Dec. 31 was 14.2 billion rupees ($208 million), beating the average estimate of 12.8 billion rupees from 25 analysts surveyed by Bloomberg.

Mahindra & Mahindra jumped 3.4 percent, the most since Jan. 22, after its third-quarter sales met analyst estimates. Bharti rallied 5.1 percent, the most since May 29. The stock climbed 5.7 percent this week.

Sixteen of the 30 Sensex companies, or 53 percent, that have reported earnings for the December quarter so far have beaten estimates. That compares with 57 percent in the quarter ended Sept. 30, data compiled by Bloomberg show.

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