Reliance Ruling Drags India Stocks

123jump.com Staff
15 Jun, 2009
New York City

Reliance Industries was ordered to sell natural gas at half the current sale price to Reliance Natural. The court order will end the feud between Ambani brothers. Net fund flows to domestic funds surge in May.

[R]5:00 PM Mumbai, 7:30 AM New York – Reliance Industries was ordered to sell natural gas at half the current sale price to Reliance Natural. The court order will end the feud between Ambani brothers. Net fund flows to domestic funds surge in May.[/R]

Stocks in Mumbai trading declined as global markets closed lower and a ruling on energy price for Reliance Industries. Group of Eight nations discussed ‘exit strategies’ to unwind large economic stimulus as world markets have recovered and world economies are expected to recover in next twelve months.

The Sensex index in India decreased 362.42 or 2.38% closed to 14,875.52 and CNX Nifty index declined 2.2% to 4,484.

Of the 30 stocks in the Sensex, 20 decreased and 10 increased.

Trading turnover on the BSE declined to 7,078 crore rupees from 7,897.45 crore rupees on Friday and on the NSE decreased to 20,769.45 crore rupees.

Foreign investors added 6,114.10 crore rupees in the first two weeks of June and 27,433.50 crore rupees till June 12 of this year.

Net inflows to domestic equity mutual funds increased to 1,930 crore rupees in May, according to Association of Mutual Funds in India. The net inflows total in the first four months was less than half of May.

Gainers & Losers

Reliance Industries plunged 7.5% to 2,180.45 rupees after Bombay High Court set much lower price for the gas sale to Reliance Natural Resources. The court orders RIL to supply 28 million of standard cubic meters of gas for 17 years at $2.34 a unit. The gas price is $4.20 by the government and Reliance to other customers.

Reliance Natural surged 24% to 108.35 rupees on the news and was the most active stock on the BSE. Reliance Power that relies on the energy from Reliance Natural gained 4.1% to 200.20 rupees.

Reliance Communications declined 3.8% to 319.30 rupees after it added 0.24 crore (or 2.4 million) users in May adding to 7.7 crore total.

Wipro declined 2% to 401.75 rupees and Tata Consultancy Services increased 1.9% to 778.60 rupees on media reports that companies are expected to bid for $200 million contract from Royal Mail Group of the U.K.

Asian Markets Review

The Nikkei 225 Index in Tokyo closed lower 96.15 or 0.95% to 10,039.67, Hang Seng index in Hong Kong decreased 390.72 or 2.07% closed to 18,498.96, CSI 300 index in China higher 59.91 or 2.06% closed to 2,966.19. ASX 200 index in Australia decreased 30.50 or 0.75% closed to 4,031.70. The KL Composite index in Malaysia higher 1.02 or 0.09% closed to 1,091.17.

The Kospi Index in South Korea decreased 16.17 or 1.13% to close at 1,412.42.SET index in Thailand closed lower 16.63 or 2.65% to 611.92 and JSE Index in Indonesia decreased 21.07 or 1.01 % closed to 2,069.88. The Sensex index in India decreased 362.42 or 2.38% closed to 14,875.52.