India Stocks Ease on Stubborn Wholesale Inflation

Devan Biswas
07 Apr, 2011
New York City

Mumbai stocks wavered after a nine-day rally that lifted stocks more than 9%. The rising commodities prices are stoking fears of inflation as the latest data showed no improvement in wholesale prices.

[R]4:00 PM Mumbai – Mumbai stocks wavered after a nine-day rally that lifted stocks more than 9%. The rising commodities prices are stoking fears of inflation as the latest data showed no improvement in wholesale prices.[/R]

Stocks in Mumbai traded sideways and edged lower in the final hour. Rising prices of crude oil and commodities have stoked the worries of inflation. The latest read on wholesale inflation showed a marginal decline prompting worries of more tightening bias by the central bank.

The wholesale price index in India increased 0.5% to 188.2 from 187.2 for the previous week. For the year to the week inflation edged down to 12.97% compared to 12.98% in the previous period.

The Sensex declined 21.02 to 19,591.18 and the Nifty index fell 6.05 to 5,885.70.

The rupee edged lower to 44.75 to a dollar and the price of gold for ten grams closed 20,763.40.

Stock Movers

Andhra Pradesh Paper Mills eased 1.8% to Rs 388.55 after soaring more than 127% from March 25. The company’s majority stake holder earlier accepted an offer form the U.S. based International Paper.

Sesa Goa decreased 2.8% to Rs 316.70 after soaring above 10% two days ago after the securities regulators approved the company to make an open offer for Cairn India stake.

Glenmark Pharmaceuticals increased 1.1% to Rs 306.50 after the company signed a distribution agreement with Canada based company to sell products in eight countries.

Zandu Realty increased 17.4% to Rs 2,420 and Blue Dart Express increased 20% to Rs 1,336.20 on sharply higher trading volume.

Radico Khaitan increased 6.5% to Rs 144.90 after the company and Japan based Suntory Liquors signed an agreement to launch two premium whiskey brands.

Mahindra Satyam increased 1.7% to Rs 76.15 after the company won outsourcing order from Vodafone Australia. Separately, Supreme Court stay order delayed the decision on demand of Rs 617 crore from the income tax department.

Spanco increased 1% to Rs 157 after the company led consortium won e-governance contract from the Transportation Department in Punjab for Rs 61 crore.

Persistent Systems increased 2.1% to Rs 415.10 after the company entered in a joint venture with Sprint Nextel Corp to provide long distance telecom services in India.

Scooters India reported net sales in the December 2010 quarter increased 27% to 34.04 crore and net loss fell 15% to Rs 5.56 crore.