Indian Stocks Pare Weekly Advance on Political Impasse
Indian stocks dropped for the first time in three days, paring a weekly advance, amid a political impasse over the government’s move to allow foreign companies to open supermarkets.
The BSE India Sensitive Index (SENSEX), or Sensex, fell 0.1 percent to 18,505.89, according to preliminary closing prices at 3:30 p.m. in Mumbai. The gauge rose 1.1 percent this week, snapping two weeks of declines. ITC Ltd. (ITC), Asia’s second-largest tobacco maker, was the biggest drag on the Sensex. NTPC Ltd., the top power producer, dropped to the lowest in about three months.
The lower house of parliament was adjourned today amid uproar over the government’s move to allow foreign retailers to set up in India. The government has called for an all-party meeting on Nov. 26 to solicit support for the plan, the Press Trust of India reported yesterday. Prime Minister Manmohan Singh averted a no-confidence vote yesterday.
“Investors are waiting to see how uncertainties around allowing foreign direct investment in retail are solved,” Vaibhav Sanghvi, director at Ambit Investment Advisors Pvt. in Mumbai, said by telephone.
Singh is reaching out to political parties to win backing to push through reforms in the winter parliamentary session that began yesterday, including proposals to increase overseas investment in the insurance and pension industries. He failed to break a logjam yesterday at a dinner hosted for leaders of the biggest opposition Bharatiya Janata Party, the Press Trust said, citing people it didn’t identify.
The S&P CNX Nifty Index (NIFTY) on the National Stock Exchange of India Ltd. fell less than 0.1 percent to 5,626.60.
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