Indian shares hit as rupee slumps to record low; foreign flows key
26/06/2013 12:20
* BSE index falls 0.41 pct; NSE ends 0.36 pct lower * Bharti Airtel falls; regulatory concerns resurface * Reliance Capital partners with Japanese firms for banking licence By Abhishek Vishnoi MUMBAI, June 26 (Reuters) - Indian shares fell on Wednesday as blue chips such as Tata Motors declined after the rupee slumped to a record low, escalating worries foreign investors may exacerbate outflows and dimming chances of a rate cut by the Rerserve Bank of India. The rupee INR=D2 breaching the key psychological level of 60 to the dollar has worsened fears about the country's current account deficit and complicated the task for policy makers looking to revive an economy that grew at its slowest in a decade in 2012/13. The falls in the rupee also led to a slump in bond prices IN071623G=CC , indicating receding bets the central bank would cut interest rates in a country still faced with the prospect of losing its investment-grade rating. In recent months, the reform process has sputtered, taking some of the shine off India for investors, with FIIs selling shares worth 105.50 billion rupees ($1.77 billion) in 11 consecutive sessions to Monday. "Continued weakness in the rupee and FIIs selling in equities is creating a negative mood in the market, as investors are apparently selling on every rally," said Rakesh Goyal, senior vice president at Bonanza Portfolio Ltd. The benchmark BSE index .BSESN fell 0.41 percent, or 77.03 points, to end at 18,552.12, ending near its lowest close in 2 months, hit on Monday. The broader NSE index .NSEI fell 0.36 percent, or 20.40 points, to end at 5,588.70, closing below the psychologically important 5,600 level. Blue chips hit by the rupee slump include Tata Motors Ltd TAMO.NS which fell 3.1 percent and Larsen and Toubro Ltd LART.NS that ended 1.1 percent lower. Among lenders, HDFC Bank Ltd HDBK.NS declined 1.8 percent while ICICI Bank Ltd ICBK.NS fell 0.7 percent. Bharti Airtel Ltd BRTI.NS fell 6 percent as regulatory concerns resurfaced ahead of a ministerial panel meeting on mobile spectrum auction later in the day. ID:nL3N0F21SC Jeweller Gitanjali Gems Ltd GTGM.NS slumped 9.99 percent, hitting its daily lower limit for a third consecutive day, on fears the government would unveil more curbs to restrict the supply of gold. The stock's three-day fall wiped out 19.54 billion rupees ($327.36 million), or half of its market capitalisation. ID:nL3N0F214Z Another jewellery maker, Rajesh Exports REXP.NS , fell 1.6 percent after its chairman told Reuters the company expects sales and earnings to grow at 10 percent in the current financial year to March, sharply slower than expected earlier, because of government measures to curtail gold imports. ID:nL3N0F21SD India's Bajaj Auto BAJA.NS fell 0.7 percent after it said it expects output at one of its plants in western India to drop by a third in June and July due to an employee strike that began on Tuesday. ID:nI8E7KE02O Among stocks that gained, Reliance Capital Ltd RLCP.NS rose 2.2 percent after company said it would apply for a license to enter mainstream banking in the country in partnership with Japan's Sumitomo Mitsui Trust Bank MITBKL.UL and Nippon Life Insurance of Japan NPNLI.UL . ID:nWNBS004AZ For additional stocks on the move double click MEYE FACTORS TO WATCH * Euro falls to three-week low vs dollar FRX/ * Brent slips as US data backs Fed stimulus cut strategy O/R * Soothing c.bank talk steadies shares MKTS/GLOB * Foreign institutional investor flows INFII INFII01 * For closing rates of Indian ADRs INADR ASIA-PACIFIC STOCK MARKETS: Pan-Asia........ STXNEWS/AS Japan....... .T S.Korea... .KS S.E. Asia....... .SO Hong Kong... .HK Taiwan.... .TWX Australia/NZ.... .AX India....... .BO China..... .SS OTHER MARKETS: Wall Street .... .N Gold ....... GOL/ Currency.. FRX/ Eurostocks..... .EU Oil ........ O/R JP bonds... JP/ ADR Report ..... ADR/ LME metals. MET/L US bonds.. US/ Stocks News US.. STXNEWS/US Stocks News Europe STXNEWS/EU DIARIES & DATA: Indian Data Watch ID:nINDATA Asia earnings diary ASIA/EQTY U.S. earnings diary RESF/US European diary WEU/QTY Indian diary IN/DIARY Wall Street Week Ahead .N/O Eurostocks Week Ahead .EU/O TOP NEWS: For top Asian company news, double click on: urn:newsml:reuters.com:*:nTOPEQA U.S. company news TOP/EQU European company news TOP/EQE Forex news TOP/FRX Global Economy news TOP/MACRO Technology news TOP/TECH Telecoms news TOP/TELCO Media news TOP/MEDIA Banking news TOP/FIN Politics/General TOP/G Asia Macro dataRecent news on Gitanjali Gems
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