Nifty-Index Futures Swing Between Gain, Loss on ECB
Indian stocks declined for the first time in five days as investors await a policy announcement by the European Central Bank after the Federal Reserve refrained from adding stimulus to the U.S. economy.
Tata Motors Ltd. (TTMT), the owner of Jaguar Land Rover, dropped, ending a four-day rally. Sterlite Industries (India) Ltd. (STLT), the biggest copper and zinc maker, retreated 1.3 percent. The BSE India Sensitive Index (SENSEX) lost 0.2 percent to 17,223.84, according to preliminary closing prices at 3:30 p.m. in Mumbai.
Fed Chairman Ben S. Bernanke held off on increasing record stimulus even as economic growth slowed. The ECB is due to make a policy announcement today, with President Mario Draghi vowing policy makers will do whatever is needed to preserve the euro. The Sensex has risen 11 percent since Jan. 1, fueled by $10.5 billion of stock purchases by foreign funds. The flows are the highest in Asia this year and a record for the period.
“Investors are focused on the ECB meeting, the outcome of which will decide if the risk-on trade will last or not,” D.K. Aggarwal, chairman of SMC Investments & Advisors Ltd., which has about $100 million in assets, said from New Delhi.
Most investors in Asia, the Americas and Europe expect the ECB will engage in sovereign-bond purchases in support of Spain and Italy, Goldman Sachs Group said in a note yesterday, citing a survey of 410 people. Draghi is trying to win consensus across governments and central banks for a plan to boost the region’s bond market that could be announced today after he chairs the ECB’s Governing Council meeting.
The EU accounted for 17.2 percent of India’s exports in the six months ended September 2011, commerce ministry said.
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