Indian Stocks End Six-Day Advance as Hind Lever, HDFC Retreat

  • HDFC Bank fourth quarter net profit up 20%, matching estimates
  • Sensex facing resistance trading at 200-daily moving average

Indian stocks declined, led by consumer goods companies, as some investors judged the six-day rally was excessive.

Hindustan Unilever Ltd., the biggest home-products maker, retreated the most in six weeks, while Asian Paints Ltd. and cigarette maker ITC Ltd., lost at least 1.3 percent. Sun Pharmaceutical Industries Ltd., the most valuable drugmaker, slid the most in two weeks. Housing Development Finance Corp. fell for the first time in eight days.

The S&P BSE Sensex lost 0.2 percent at the close in Mumbai, after changing direction at least 20 times. The gauge has risen 13 percent from a February low, sending its 14-day relative strength index to near the 70 threshold, which some investors see as a signal to sell. Investors are focused on the March quarter earnings to look for signs of economic growth filtering through to company bottom lines. Profits have dropped in four of the past five quarters in the worst run since the global financial crisis.

“We have seen a superb rally over the past two months and now all eyes are on how the earnings season pans out," R. K. Gupta, managing director of Taurus Asset Management Co., which has $590 million, said from New Delhi. “The market is at a crossroad."

Reliance Industries, owner of the world’s largest refining complex, may say its fourth-quarter profit rose 12 percent to 70.2 billion rupees, according to the median estimate in a Bloomberg survey. The stock slid 0.2 percent. HDFC Bank Ltd., the most valuable lender, said profit rose 20 percent to 33.7 billion rupees, matching the 33.9 billion rupees estimated by analysts. The stock rose 0.1 percent.

So far, three out of four Sensex companies have reported earnings that beat or matched estimates. The gauge rose 0.8 percent this week.

Hindustan Unilever lost 2.2 percent, the most since March 8. Housing Development Finance slid 1.6 percent after a seven-day, 7.4 percent rally. Sun Pharmaceutical fell 1.5 percent. Asian Paints lost 2 percent, ending a six-day climb. ITC decreased 1.3 percent to its lowest level since April 12.

Maruti Suzuki India Ltd., the maker of half the cars sold in India, advanced to its highest level since Feb. 3. State Bank of India, the biggest lender, rallied 3 percent. The stocks were the best performers on the Sensex.

Oil & Natural Gas Corp., the largest state explorer, added 1.5 percent to pare this year’s loss to 10 percent. Tata Motors Ltd., owner of Jaguar Land Rover, rose 1.3 percent.

Overseas funds sold almost $2 million of domestic equities on April 20, paring this year’s inflows to $1.4 billion. The Sensex has lost 1.1 percent this year and trades at 15.9 times 12-month projected earnings versus 12 for the MSCI Emerging Markets Index.

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