Mumbai: Indian shares logged first weekly loss in three as they shed 0.3% on Friday, on mixed world markets amid caution ahead of the US jobs data which is expected to shine a light on the strength of the US recovery as double-dip recession fears remain.
Investors awaited the all-important US June employment data, due at 1230 GMT, which likely contracted for the first time this year as thousands of temporary jobs for census workers ended, though private-sector hiring probably picked up, according to a Reuters survey.
Billionaire Mukesh Ambani-controlled Reliance Industries, which has the highest weight on the main index, led the decline and dropped 0.7% to Rs1,068.45.
Merger talks between Reliance Power and Reliance Natural Resources, both led by Mukesh’s younger brother Anil Ambani triggered volatility in the pack. The two boards will meet on 4 July to consider a merger, the firms said after market hours.
Reliance Power closed 3.3% higher while Reliance Natural Resources closed down 1.9%, after rising as much as 4.7% in the day.
The 30-share BSE index closed 0.28%, or 48.38 points lower at 17,460.95, taking losses for the week to 0.6%.
Eighteen of its components closed in the red.
“Market will be largely rangebound next week,” said R.K. Gupta, managing director of Taurus Mutual Fund.“The bias though is likely to be positive ahead of June quarter earnings that will trickle in later in the month.”
Investors withdrew $453.8 billion from money market funds in the first-half of 2010 despite the May-June risk shakeout, heading mainly for bond funds and emerging equities, data from fund tracker EPFR Global showed.
Investors are nervous about the global growth recovery, with the euro zone crisis continuing to weigh heavily on sentiment, but they appear more confident about the economic outlook for the developing world, the data indicates.
Foreign funds have poured in $6.7 billion in Indian equities so far this year, with primary market offering absorbing some of this inflow. The benchmark index is barely changed year-to-date.
Foreign funds invested a record $17.5 billion in 2009, which saw the benchmark index post an impressive 81% gain.
State-run explorer Oil and Natural Gas Corp rose 0.3% on its plan to step up exploration off India’s western coast and on last week’s government move to raise fuel prices.
Tata Motors raced 0.5% on a 49% jump in domestic sales in June, while No. 2 cement producer ACC declined 0.5% as its June shipments fell 1.7%.
Top outsourcer Tata Consultancy Services and rival Wipro <rose 1.7% and nearly 3% respectively.
“There are some questions on the pace of global economic recovery. But the situation (for IT companies) is far better than the turmoil before,” said Tejas Doshi, head of research at Sushil Finance. “Cross-currency fluctuations are, however, a concern.”
Infosys dropped 1.4% on concerns its valuations could be expensive, dealers said.
Infosys was trading at 21.5 times the 12-month forward price/earnings according to Starmine’s SmartEstimate, which places more weight on recent forecasts by top-rated analysts instead of using a general average.
TCS and Wipro were trading at 18 times and 16.8 times their respective 12-month forward price/earnings.
Reliance Communications eased 0.7% on profit-taking after jumping about a third since end-May.
India’s second-largest cellular provider said late Thursday it had approved a proposal to acquire unlisted cable television services provider Digicable in an all-stock deal, to create Asia’s largest triple play -- digital TV, broadband and voice services -- provider.
In the broader market, gainers almost equalled losers in a relatively moderate volume of 419 million shares.
The 50-share NSE index dropped 0.3% to close at 5,237.10 points.
State-run oil marketing companies Indian Oil Corp, Hindustan Petroleum Corp, and Bharat Petroleum Corp rose between 0.5 and 1.1%, helped by the recent fuel price reforms.
Last week, India allowed market prices for petrol and said diesel would also be freed in the future, to bolster the government’s finances. It also raised prices of state-subsidised kerosene and cooking gas.
Glenmark Pharmaceuticals climbed nearly 2% to Rs666.20 as the drugmaker said its unit got US FDA nod for adapalene gel used to treat acne.