India May Say Factory Output Fell for Third Month: Week Ahead

June 8 (Bloomberg) -- India’s industrial production may decline for the third straight month in April as the global recession curtails overseas sales of goods.

The government may say on June 12 that output at factories, utilities and mines fell from a year earlier after declining 2.3 percent in March and 0.7 percent in February, according to the median estimate in a Bloomberg News survey.

Exports fell 33.2 percent in April, the most in at least 14 years, as the worst global recession since the Great Depression slashed demand for the nation’s jewelry, clothing and other products. Falling overseas sales may cost India about 10 million jobs, the Federation of Indian Export Organisation, a lobby group, estimates.

The Society of Indian Automobile Manufacturers will release data for domestic car sales in May today after companies sold 4.2 percent more cars in April from a year earlier.

India’s rupee strengthened last week on optimism a rally in the benchmark share index will spur overseas investors to raise holdings of local stocks from a 10-month high.

The rupee climbed 0.1 percent to 47.1225 per dollar in the five days through June 5 in Mumbai, according to data compiled by Bloomberg. That took its gains this quarter to 7.6 percent, the third-best among the 10 most-used Asian currencies.

Bonds, Stocks

Government bonds gained last week after a report showed the inflation rate slowed. The yield on the 6.05 percent note due February 2019 fell 14 basis points to 6.56 percent in Mumbai, according to the central bank’s trading system. The price rose 1.01 per 100-rupee face amount, to 96.41. A basis point is 0.01 percentage point.

The Sensitive index rose 3.3 percent last week, extending its winning streak to 13 weeks. The index completed the longest weekly winning streak since August 2005 after President Pratibha Devisingh Patil told parliament on June 4 the government may allow greater overseas investment and inject capital into lenders to stoke economic growth. Fund inflows surged to a one- year high.

Grasim Industries Ltd., India’s third-biggest cement maker and producer of viscose-staple fiber, and Tata Motors Ltd., the largest truck maker, were the biggest gainers last week. Grasim added 19.5 percent and Tata Motors 15.5 percent.