Indian stocks end flat; record low rupee weighs

Pennar Industries

10/06/2013 12:58

* BSE ends up 0.06 percent, NSE down 0.05 percent 
    * Lenders fall as high CAD fears and weak rupee dash 
rate-cut hopes 
    * IT stocks rise on expected forex gains 
 
    By Himank Sharma 
    MUMBAI, June 10 (Reuters) - Indian shares ended flat on 
Monday as a fall in the rupee to a record low hit lenders on 
fears the central bank would hold off from cutting interest 
rates, while IT companies rose on hopes of improving returns 
from overseas markets. 
    Indian rupee fell to a record low against the dollar on 
Monday, escalating worries about the country's current account 
deficit and complicating the task for policymakers looking to 
revive an economy that grew at its slowest in a decade in 
2012/13.  ID:nL3N0EM0SF  
    The falls also sparked concerns foreign investors would turn 
net sellers after strong buying this year, offsetting initial 
hopes that Friday's slightly stronger-than-expected jobs data 
would reduce the prospect of an early rolldown in the U.S. 
monetary policy. 
    Investors are also focused on key data this week, including 
industrial output and inflation indicators, which will help set 
expectations ahead of the Reserve Bank of India's policy review 
on June 17.  
    "There has been an outflow from the debt markets by FIIs due 
to concerns on the currency as well as the direction of the 
markets. There is a fear that if something similar happens to 
equity markets, our markets may not be able to absorb selling 
pressure from FIIs without reacting sharply lower," said Deepak 
Jasani, head of retail research at HDFC Securities.  
    "But at the same time the sharp currency depreciation gives 
hope that RBI will intervene in a big way at some point and that 
the government will make a major policy announcement to manage 
the current account deficit and the rupee." 
    The benchmark BSE index  .BSESN  closed up 0.06 percent, or 
11.84 points, to end at 19,441.07, while the broader NSE index 
 .NSEI  closed down 0.05 percent, or 3 points, at 5878.00. 
    The NSE banking index  .NSEBANK  fell 1.18 percent to its 
lowest level since April 18 after all constituents, except HDFC 
Bank Ltd  HDBK.NS , ended in the red. 
    Worries that a weak rupee would make the RBI more cautious 
about cutting interest hit banks. Most traders and analysts 
expect the central bank to keep rates on hold next week after 
cutting 75 basis points so far this year. 
    ICICI bank Ltd  ICBK.NS  closed down 2.09 percent, Yes bank 
Ltd  YESB.NS  fell 2.41 percent and State Bank of India  SBI.NS  
closed 0.62 percent lower. 
    Meanwhile, GlaxoSmithKline Pharmaceuticals Ltd  GLAX.NS  
closed 4.67 percent down after Nomura downgraded the stock by a 
notch to "reduce", citing the adverse impact from the 
government's recent price controls and decreasing likelihood of 
an open offer from parent GlaxoSmithKline Plc  GSK.L . 
    Shares in Jet Airways  JET.NS  closed down 11 percent after 
its CEO resigned ahead of a key regulatory meet to decide on 
approval for a stake sale to Gulf carrier Etihad Airways. 
 ID:nL3N0EM1PO  
    However, information technology stocks rose, with Infosys 
Ltd  INFY.NS , rising 1.63 percent, Tata Consultancy Services 
Ltd  TCS.NS  0.4 percent and HCL Technologies Ltd  HCLT.NS  1.24 
percent as weak rupee improves software exporters' profits.  
    Engineering company Pennar Industries Ltd  PENN.NS  gained 
1.66 percent after its board announced a buy-back of up to 100 
million rupees worth of stock.  ID:nWNBS0044D  
    Multi Commodity Exchange of India  MCEI.NS  rose 3.72 
percent after it launched a new proprietary platform to corner 
the market for exchange-based trading of debt securities. 
 
   For additional stocks on the move double click  MEYE          
      
   FACTORS TO WATCH                                              
* Dollar weak and vulnerable before U.S. jobs data         FRX/  
* Brent rises on weak dollar, U.S. economic stimulus        O/R  
* Dollar, shares shaky ahead of U.S. jobs data        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                                     
                          
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($1 = 57.0750 Indian rupees) 
 
 (Editing by Jijo Jacob) 
 ((Himank.Sharma@thomsonreuters.com)(+91 22 6180 7207)(Reuters 
Messaging: himank.sharma.thomsonreuters.com@reuters.net)) 
 
Keywords: MARKETS INDIA STOCKS/CLOSE