Indian (SENSEX) stocks declined, with the benchmark index holding at a two-month low, as global equities extended a slump.
The S&P BSE Sensex dropped 0.9 percent to 18873.64 at 9:40 a.m. in Mumbai, poised for the lowest level since April 17. Sun Pharmaceutical Industries Ltd. (SUNP), India’s biggest drugmaker, sank 6 percent after it was asked to pay $550 million to Pfizer Inc. and a partner to settle litigation over unauthorized sales of the heartburn drug Protonix. Housing Development Finance Corp. (HDFC) declined to a two-month low.
The MSCI Asia Pacific Index plunged, erasing this year’s gains and poised to enter a correction, as investors extended a selloff amid concerns central banks may reduce stimulus, and after the World Bank cut its global growth forecast. The Sensex has lost 4.2 percent this month on concern the rupee’s decline will make imports more expensive and narrow the RBI’s scope to extend interest-rate cuts at its policy review on June 17.
Overseas investors sold $140 million of local stocks on June 11, paring this year’s inflows to $15.2 billion. That’s still a record for the period, data compiled by Bloomberg show.
India’s credit-rating outlook was revised to stable from negative by Fitch Ratings, following a nine-month policy push by the government to pare the nation’s budget deficit and revive economic growth.
The Sensex is valued at 12.9 times projected 12-month profits, the cheapest since April 24. That compares with the MSCI Emerging Markets Index’s 9.7 times.
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