India's Stocks Fall on Risk Aversion; Sterlite, Wipro Decline
India's benchmark stock index fell, on course for its worst month since January, as Europe's sovereign debt crisis and rising U.S. jobless claims prompted investors to withdraw funds from riskier assets.
Sterlite Industries (India) Ltd., the largest copper producer, dropped 1.6 percent as metal prices tumbled. Wipro Ltd., India's third-largest software-services provider, declined to the lowest in two weeks. The nation's largest software exporters get more than a fifth of their sales in Europe.
"Global risk aversion has increased among investors," said Alex Mathews, head of research at Geojit BNP Paribas Financial Services Ltd. in Kochi, southern India. "The global markets are under a lot of pressure. We have advised our clients to book profits in mid and small-cap stocks."
The Bombay Stock Exchange's Sensitive Index, or Sensex, fell 74.07, or 0.5 percent, to 16,445.61, taking its loss this week to 3.2 percent. The gauge is poised for its worst monthly performance since January's 6.3 percent slide.
The S&P CNX Nifty Index on the National Stock Exchange lost 0.3 percent to 4,931.15. The BSE 200 Index retreated 0.6 percent to 2,089.54.
Prices Tumble
Sterlite declined 1.6 percent to 641.65 rupees. The stock has slid 22 percent since the end of April and is poised for its worst monthly performance since October 2008. Commodities, measured by the Reuters/Jefferies CRB Index of 19 raw materials, slumped to an eight-month low yesterday.
Wipro dropped 1.9 percent to 641.7 rupees. Tata Consultancy Services Ltd., the largest software services exporter, slid 1.6 percent to 718.7 rupees, its lowest close in more the four months.
India's rupee fell past 47 per dollar for the first time this year, set for the worst week since 1995.
"Economic-growth rates are coming under threat globally due to the European debt crisis and this has triggered an erosion of investor confidence," said R.V.S. Sridhar, senior vice president at Axis Bank Ltd. in Mumbai.
Overseas investors sold a net 14.7 billion rupees ($320.4 million) of Indian equities yesterday, reducing their total purchases of the stocks this year to 245.9 billion rupees, according to the nation's market regulator.
Inflows from overseas reached a record 834.2 billion rupees in 2009, exceeding the high set two years earlier in domestic currency terms, as the biggest rally in 18 years lured foreign funds. They sold a record 529.9 billion rupees of shares in 2008, triggering a record annual decline.
The following were among the most active on the exchange:
Abbott India Ltd. (BOOT IN), the local unit of Abbott Laboratories, advanced 3.4 percent to 1,095.8 rupees. Its parent agreed to buy Piramal Healthcare Limited's Healthcare Solutions unit for $3.72 billion. Piramal (PIHC IN) sank 12 percent to 502.75 rupees.
ITC Ltd. (ITC IN) added 3.4 percent to 271.3 rupees. India's biggest cigarette company said fourth-quarter profit rose 27 percent from a year earlier to 10.3 billion rupees on higher tobacco sales.
Jaypee Infratech Ltd. (JPIN IN) dropped 10 percent to 91.45 rupees as the unit of India's biggest builder of dams commenced trading. The company raised 22.6 billion rupees selling 60 million shares to the public at 102 rupees a piece.
Wockhardt Ltd. (WPL IN) sank 7.2 percent to 119.9 rupees after the drugmaker reported a net loss of 5.6 billion rupees in the fourth quarter.
To contact the reporter on this story: Rajhkumar K Shaaw in Mumbai at rshaaw@bloomberg.
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