Indian (SENSEX) stock futures dropped before the Reserve Bank of India meets to review monetary policy tomorrow, and before today’s release of manufacturing data.
SGX CNX Nifty Index futures for May delivery fell 0.2 percent to 5,959.5 at 10:05 a.m. in Singapore. The underlying CNX Nifty (NIFTY) Index advanced 0.4 percent to 5,930.20 on April 30. The S&P BSE Sensex index gained 0.6 percent to 19,504.18. Indian markets were closed yesterday for a public holiday. The Bank of New York Mellon India ADR Index of U.S.-traded shares fell 0.9 percent yesterday.
The Sensex capped its biggest monthly gain since November last month as slowing wholesale-price inflation and a drop in gold and oil stoked speculation the central bank will cut borrowing costs tomorrow. The RBI may lower its key rate by 25 basis points, according to the median estimate of 40 economists in a Bloomberg survey. HSBC Holdings and Markit Economics release manufacturing data for April today. The purchasing managers’ index dropped to a 16-month low in March.
“The rally over the past few days has been very good, hence some amount of caution is creeping in,” Arun Kejriwal, director at Mumbai-based Kejriwal Research & Investment Services, said by telephone today. “A 25 basis-point rate cut is already in the price, only a bigger rate cut will take the markets higher from here.”
Bharti Airtel Ltd. (BHARTI), India’s biggest mobile phone company, may say fourth-quarter profit declined 24 percent to 7.65 billion rupees ($142 million) from 10.1 billion rupees a year earlier, according to the median of 26 analyst estimates in a Bloomberg survey.
Foreign funds bought a net $122 million of local shares on April 29, taking their net investment in equities this year to $11.15 billion, data compiled by Bloomberg show. Inflows last year totaled $24.5 billion, the most among 10 Asian markets tracked by Bloomberg, the data show.
The Sensex trades at 13.1 times projected 12-month profits, compared with MSCI Emerging Markets Index’s 10.4 times.
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