BackIndia’s VIX index climbs for fifth day as stocks extend slide
The VIX Index, a measure of protection against stock-market swings, jumped 8.4% to 16.30, capping a fifth day of gains, the longest rising streak in 2015
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Mumbai: The benchmark gauge of Indian equity-option prices climbed to a seven-week high as stocks fell for a fourth straight day amid concern about quarterly earnings.
The VIX Index, a measure of protection against stock-market swings, jumped 8.4% to 16.30 at the close in Mumbai, capping a fifth straight day of gains, the longest rising streak in 2015. The CNX Nifty index tumbled 1.83% to 8,448.1, while the S&P BSE Sensex plunged 2%, with both measures closing at the lowest level in three weeks.
Sensex company earnings will probably decline for a second straight quarter, according to estimates compiled by Bloomberg. UBS AG reduced its December target for the 50-stock Nifty by 4% to 9,200 on Monday, citing a slowdown in profit growth. Indian lawmakers will debate legislation, including a bill on the acquisition of land, as the second part of the parliament’s budget session began Monday.
“We expect volatility to rise amid quarterly earnings and the parliament session," Nilesh Dedhia, a director at Vidhi Wealth Management Ltd, said in a phone interview. “Traders aren’t taking big directional bets on Nifty."
Macquarie Capital Securities India Pvt.Ltd, the most accurate index forecaster for the past two years in Bloomberg surveys, has cut its earnings forecast for the 30 Sensex companies by 2.2% for the year through March 2016.
Global investors bought $79 million of index options on Friday, a third day of purchases, according to data compiled by Bloomberg. Foreigners sold a net $34 million of local shares on April 16, paring this year’s inflows to $6.3 billion, still the most in Asia. They’d purchased $16 billion of stocks last year. Bloomberg
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