Indian (SENSEX) stock-index futures swung between gains and losses before the beginning of the earnings reporting season and the release of monthly industrial output data this week.
SGX S&P CNX Nifty Index futures for January delivery gained 0.1 percent to 6,050 at 10:06 a.m. in Singapore after dropping as much as 0.3 percent. The underlying S&P CNX Nifty Index on the National Stock Exchange of India Ltd. climbed 0.2 percent to 6,001.70 yesterday. The BSE India Sensitive Index, or Sensex, added 0.3 percent to 19,742.52. The Bank of New York Mellon India ADR Index of U.S.-traded shares lost 1.4 percent, the biggest drop since Nov. 7.
Infosys Ltd. (INFO), India’s second-largest software exporter, begins the earnings season for Sensex companies on Jan. 11, announcing results for the three months ended Dec. 31. The government releases industrial production figures for November on the same day.
“We can expect the market to be volatile for this remaining week,” Rakesh Goyal, senior vice president at Bonanza Portfolio Ltd., wrote in an e-mail. “There is a resistance zone of 6,050-6,100 from where the Nifty (NIFTY) has seen steep falls in the past and hence some profit-booking may be seen from these levels.”
Infosys’s net income for the quarter ended Dec. 31 may be 22.45 billion rupees ($408 million), according to the median estimate of 28 analysts in a Bloomberg survey. That compares with profit of 23.7 billion rupees in the same quarter last year.
Industrial output may have expanded 0.4 percent in November, according to the median estimate of 20 analysts surveyed by Bloomberg. Production grew 8.2 percent in October, the fastest pace in more than a year.
Global funds bought a net $110 million of Indian equities on Jan. 7, a seventh consecutive day of purchases, exchange data showed yesterday. The Sensex rallied 26 percent in 2012, its biggest annual gain since 2009, as policy measures to revive an economy expanding at the slowest pace in three years lured foreigners to invest a net $24.5 billion into shares, the highest among 10 Asian markets tracked by Bloomberg.
Bank of India shares may be active after Deutsche Bank AG upgraded the stock to buy from hold and raised its 12-month target price today by 44 percent to 455 rupees. The lender is the “best turnaround candidate” among the nation’s financial stocks this year, the bank said in a report today. The shares closed at 365.05 rupees yesterday.
Deutsche Bank also raised its target prices on Axis Bank Ltd., Bank of Baroda, ICICI Bank, Punjab National Bank and Shriram Transport Finance Ltd. Earnings will grow an average 21 percent this year on an expected 100 basis-point cut in the benchmark interest rate by the Reserve Bank of India, according to the report.
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