Asian Stocks Post Weekly Decline on China Factory Data, Ukraine By Jonathan Burgos - Apr 25, 2014

Asian stocks dropped this week, with utilities and materials producers leading declines, after China manufacturing data signaled persisting weakness in the world’s second-largest economy.

Anhui Conch Cement Co., China’s biggest producer of the building material, dropped 6 percent. Kansai Electric Power Co. slid 7 percent after saying it may take a long time to restart its nuclear reactors due to safety precautions. China Mobile Ltd. fell 4 percent after the world’s biggest phone company posted its third straight drop in quarterly profit. Largan Precision Co., a supplier of lenses used in iPhones and iPads, surged 17 percent to a record in Taipei after Apple Inc. beat estimates.

The MSCI Asia Pacific Index declined 0.7 percent to 138.17 this week. The preliminary Purchasing Managers’ Index from HSBC Holdings Plc and Markit Economics for April signaled a fourth month of contraction in Chinese factory activity.

“Concerns about China’s slowdown and escalating tensions in Ukraine are keeping people from being bullish,” said John Vail, Tokyo-based chief global strategist at Nikko Asset Management Co., which manages about $157 billion. “Asia is a little bit more sensitive to these things.”

U.S. President Barack Obama discussed deepening sanctions against Russia with the leaders of Germany, France, the U.K. and Italy on a conference call yesterday. Discussions on sanctions by the Group of Seven nations accelerated after Russia renewed military exercises on its neighbor’s border and explosions in two Ukrainian cities injured eight.

South Korea’s Kospi index slid 1.6 percent. Taiwan’s Taiex index sank 2.1 percent. Singapore’s Straits Times Index added 0.4 percent. India’s BSE Sensex index rose 0.3 percent.

Tokyo Prices

Japan’s Topix lost 0.3 percent. A report yesterday showed Tokyo’s consumer prices rose 2.7 percent from a year earlier in April, the biggest jump since 1992, pumped up by a sales-tax increase and a year of unprecedented stimulus from the Bank of Japan.

Australia’s S&P/ASX 200 Index climbed 1.4 percent to its highest since June 2008 in a week shortened by holidays. The nation’s core consumer prices gained less than economists forecast last quarter, allowing the central bank to extend a period of steady interest rates.

New Zealand Rates

New Zealand’s NZX 50 Index advanced 1 percent. The central bank raised interest rates for the second time in two months as the economic recovery gathers pace, and said it will assess the extent to which currency gains curb inflation.

China’s Shanghai Composite Index (SHCOMP) declined 2.9 percent this week. The Hang Seng China Enterprises Index of mainland shares traded in Hong Kong slipped 2.8 percent, while the city’s benchmark Hang Seng Index Index lost 2.4 percent.

HSBC Holdings Plc and Markit Economics survey of China manufacturing had a preliminary reading of 48.3 in April, matching the median estimate of analysts surveyed by Bloomberg and rising from March’s final figure of 48. Readings below 50 signal contraction.

There are “now expectations that the target of 7.5 percent Chinese GDP growth for this year might be the top end of guidance,” Tony Farnham, an economist at Patersons Securities Ltd. in Perth, said by phone. “The actual growth number may be a little below that.”

No ‘Strong’ Stimulus

Premier Li Keqiang has said China isn’t considering “strong” stimulus, and reiterated that economic growth a bit higher or lower than the official goal is within a reasonable range.

Chinese cement makers and lenders dropped. Anhui Conch dropped 6 percent to HK$29 this week. BBMG Corp., a mainland cement producer and developer, sank 9.1 percent to HK$5.80. Industrial & Commercial Bank of China Ltd. slid 3.7 to HK$4.63. Agricultural Bank of China Ltd lost 3.6 percent to HK$3.21.

China Mobile fell 4 percent to HK$69.05. Net income slid 9.4 percent to about 25.24 billion yuan ($4 billion) in the first quarter, the Beijing-based company reported yesterday. Profit was expected to be 27 billion yuan, based on the median of five analysts’ estimates compiled by Bloomberg News.

Hyundai Motor Co. fell 3.7 percent to 236,000 won in Seoul. South Korea’s largest automaker reported first-quarter profit that missed analyst estimates as a stronger won eroded export earnings.

Samsung Heavy Industries Co., the world’s second-largest shipyard, tumbled 9 percent to 28,500 won in Seoul. Samsung Group has been conducting an internal audit of the company since February, the Korea Economic Daily reported, citing officials it didn’t identify. Samsung Heavy spokesman Koo Sang Ok declined to confirm details. Two calls to Samsung Group weren’t immediately answered.

Apple Suppliers

Apple suppliers advanced after the world’s most valuable company reported second-quarter revenue and profit. Largan Precision jumped 17 percent to NT$1,875 in Taiwan. Catcher Technology Co., which makes casings for iPhones and iPads, climbed 8.2 percent to NT$256.50.

Resona Holdings Inc. rose 6.6 percent to 520 yen after Greenlight Capital Inc., a hedge fund run by David Einhorn, said it bought shares in the Japanese lender. Greenlight paid 547 yen per share, and described the bank as “cheap on both an absolute and relative basis.”

To contact the reporter on this story: Jonathan Burgos in Singapore at jburgos4@bloomberg.net

To contact the editors responsible for this story: Sarah McDonald at smcdonald23@bloomberg.net Jim Powell, Jim McDonald

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Ukraine May Resume Push in East as Russian Deal Crumples By Daryna Krasnolutska, Volodymyr Verbyany and Julianna Goldman - Apr 22, 2014

Ukraine considered resuming operations to oust militants from eastern cities as an agreement with Russia to reduce tensions in the region lay in tatters.

Acting Ukrainian President Oleksandr Turchynov yesterday called on security forces to move against the separatists after the discovery of two bodies in the country’s eastern region, saying that “terrorists” backed by Russia had “crossed the line.” He spoke hours after meeting in Kiev with U.S. Vice President Joe Biden, who pledged American support including $50 million in aid.

With the April 17 accord faltering, Ukraine is inching closer to a renewed push to dislodge militants in defiance of Russia’s warnings that such a move risks sparking civil war. The “active phase” of the offensive was suspended five days ago as Ukraine’s government pledged to abide by the deal negotiated in Geneva by Ukraine, the European Union, the U.S. and Russia.

In a call yesterday with Russian Foreign Minister Sergei Lavrov, U.S. Secretary of State John Kerry voiced concern “over the lack of positive Russian steps to de-escalate” the crisis, according to a State Department release. Lavrov, in a statement from his office, told Kerry that Ukraine must retract orders to use its army in the southeast and proceed with disarming local “ultra-nationalist” militias to comply with the accord.

The government in Kiev accuses Russian President Vladimir Putin of stirring unrest and exploiting the situation to possibly lay the groundwork for an invasion. The separatists who took over buildings in eastern Ukrainian cities have said they’re not bound by the Geneva agreement.

‘Coming Days’

The crisis has hit both Russian and Ukrainian markets. Russia’s Micex Index (INDEXCF) dropped 0.7 percent to 1,335.62, extending its slide since Putin’s intervention in Crimea started on March 1 to 7.6 percent. The hryvnia, the world’s worst-performing currency this year, retreated after the biggest rally on record last week, depreciating 3.2 percent to 11.67 per dollar.

Ukraine’s government is doing its part to uphold the Geneva accord and “Russia needs to comply with the commitments it made” or face more sanctions, White House spokesman Jay Carney told reporters traveling with U.S. President Barack Obama. A decision to impose additional penalties may be made in the “coming days,” he said.

The U.S. and European Union have urged Russia to withdraw about 40,000 troops from its border with Ukraine. The Obama administration has threatened further measures against Russian interests, including the banking and energy industries, unless progress is made in easing the crisis sparked by Russia’s annexation of Crimea last month.

Chief Abducted

During a day marked by incidents with the pro-Russian groups, a Ukrainian military plane was damaged by gunfire during a reconnaissance flight near insurgent-held Slovyansk, where government buildings have been seized and road blocks set up, according to the Defense Ministry.

Separatists abducted the chief of police in the eastern city of Kramatorsk and took him to Slovyansk, Ihor Diomin, the spokesman for the Donetsk regional police, told Ukrainian TV 5.

The two bodies recovered yesterday showed signs of torture, Turchynov said. While the identity of one of the victims wasn’t known, one of the dead was a member of the municipal council from the nearby town of Horlivka in the Donetsk region, he said. The politician was identified as a member of presidential candidate and former Prime Minister Yulia Tymoshenko’s Batkivshchyna party, to which Turchynov also belongs.

Biden Visit

Valentyn Nalyvaichenko, the director of Ukraine’s national security service, said government authorities have arrested or detained 21 Russian agents, including three intelligence officers being held and questioned in Kiev.

“They gave us very important information and evidence,” he said during an online discussion sponsored by the Washington-based Atlantic Council.

The U.S. aid unveiled yesterday will help Ukraine pursue political and economic changes to stabilize its government, Biden’s office said in a statement. It includes $11.4 million for a May 25 presidential election that Biden said “may be the most important” to date for the country of 45 million people. The U.S. will also help on issues including non-lethal military aid to the fight against corruption, Biden’s office said.

“The opportunity to generate a united Ukraine, getting it right, is within your grasp,” Biden told a group of prominent Ukrainians including Tymoshenko, confectionery magnate Petro Poroshenko, and former world boxing champion Vitali Klitschko. “And we want to be your partner and friend in the project.”

IMF Package

The International Monetary Fund’s executive board will receive within days a staff report detailing Ukraine’s proposed loan program, in an effort to approve emergency financing by early May, a board official said.

The report, which will describe the economic outlook, financing needs and policy steps Ukraine agreed to take, may trigger a request for an expedited board review, according to the official, who spoke about private discussions on condition of anonymity. That means a typical two-week period for the board to study the report may be cut in half, with a vote next week, the person said.

The IMF is leading a $27 billion international loan package with a contribution of as much as $18 billion, which was agreed to in principle almost four weeks ago. The fund is seeking to complete its report.

After meeting Turchynov and Prime Minister Arseniy Yatsenyuk, Biden said Obama’s administration was also ready to help on energy issues “so that Russia can no longer use energy as a political weapon against Ukraine and Europe.”

U.S. Troops

Russia will demand advance payments for gas supplies to Ukraine unless the country resumes paying its bills, Russian Prime Minister Dmitry Medvedev said yesterday. The move, which would cut off gas to Ukraine without the payments to Russia, would “be a tough but fair decision,” Medvedev said in Russia’s State Duma.

With the crisis in Ukraine raising concerns across eastern Europe, the U.S. will send 600 troops from the Army’s 173rd Airborne Brigade Combat Team to four European nations for bilateral exercises this week, Rear Admiral John Kirby, a Pentagon spokesman, said yesterday.

A company-sized force of 150 troops each from the brigade based in Vicenza, Italy, will arrive in Poland, Lithuania, Latvia, and Estonia -- all members of the North Atlantic Treaty Organization -- by the end of this week for a month of training, Kirby said.

“This is a tangible representation of our commitment to security obligations in Europe and to the alliance” and are in response to the crisis in Ukraine, he said.

To contact the reporters on this story: Julianna Goldman in Kiev at jgoldman6@bloomberg.net; Daryna Krasnolutska in Kiev atdkrasnolutsk@bloomberg.net; Volodymyr Verbyany in Kiev at vverbyany1@bloomberg.net

To contact the editors responsible for this story: James M. Gomez at jagomez@bloomberg.net; Balazs Penz at bpenz@bloomberg.net; Steven Komarow at skomarow1@bloomberg.net Michael Shepard, Don Frederick

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India’s Nifty Futures Swing After Benchmarks Climb to Records By Santanu Chakraborty - Apr 21, 2014

Indian stock-index futures swung between gains and losses after benchmark indexes climbed to records yesterday.

SGX CNX Nifty Index futures for April delivery lost less than 0.1 percent to 6,834.5 at 10:08 a.m. in Singapore. The underlying CNX Nifty Index gained 0.6 percent to a record 6,817.65 yesterday. The S&P BSE Sensex (SENSEX) also added 0.6 percent to an all-time high. The Bank of New YorkMellon India ADR Index of U.S.-traded shares fell 0.3 percent.

HDFC Bank Ltd. (HDFCB) may report today that quarterly profit surged to 23.8 billion rupees ($393 million), according to a Bloomberg survey of 28 analysts. All four of the 30 Sensex companies that have reported earnings so far for the three months ended March 31 have either exceeded or matched estimates.

“Fourth-quarter results will dictate market trend,” Nidhi Saraswat, an analyst with Bonanza Portfolio Ltd., wrote in an e-mail yesterday.

International investors bought a net $67.6 million of Indian shares on April 17, ending three days of net sales, according to data compiled by Bloomberg. That brought this year’s net inflow to $4.8 billion, the second largest among eight Asian markets tracked by Bloomberg, after Taiwan.

The Sensex has climbed 7.5 percent this year and trades at 14.3 times projected 12-month profits. The MSCI Emerging Markets Index has risen 0.9 percent in 2014 and is valued at 10.5 times.

To contact the reporter on this story: Santanu Chakraborty in Mumbai at schakrabor11@bloomberg.net

To contact the editors responsible for this story: Michael Patterson at mpatterson10@bloomberg.net Matthew Oakley, Chan Tien Hin

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Speculators’ Natural Gas Wagers Rewarded With Late Rally: Energy By Naureen S. Malik - Apr 21, 2014

Speculators’ decision to raise bullish bets on U.S. natural gas was rewarded with a rally to the highest price since February.

Their net-long position across four natural-gas contracts rose 1.9 percent in the seven days ended April 15. Two days later, prices advanced the most in two months after a government report showed a second week of below-average U.S. stockpile gains, bolstering concern about tightening supply.

Inventories are 54 percent below the five-year average, the U.S. Energy Information Administration said April 17. Another year of record production will be needed to cut the shortfall by the end of October, when stockpiles may be at the lowest pre-winter level since 2008, according to EIA projections. Frigid weather since November helped send supplies last month to the lowest in 11 years.

“Right now the bullish sentiment is prevailing in term of that storage situation,” said John Kilduff, partner at Again Capital LLC, a New York-based hedge fund that focuses on energy. “It is surprising to have this kind of strength this time of the year. The past two injections haven’t lived up to expectations. The bullish sentiment is a hangover from this tremendous consumption we saw last winter.”

Net-long wagers on the four U.S. natural gas contracts rose a combined 7,793 to 426,010 in the week ended April 15, the most since Feb. 28, according to U.S. Commodity Futures Trading Commission data released April 18.

Gas Prices

Futures rose 3.3 cents, or 0.7 percent, to $4.567 per million British thermal units on the New York Mercantile Exchange during the report week. They climbed 4.7 percent to $4.741 on April 17, the biggest one-day gain since Feb. 19 and the highest settlement price since Feb. 26, and rose as much as 1 percent in today’s electronic trading. The market was closed April 18 for a public holiday.

The EIA said stockpiles increased by 24 billion cubic feet in the week ended April 11 to 850 billion. The five-year average gain for the week is 37 billion cubic feet. A week earlier, supplies rose by 4 billion, below the average gain of 9 billion.

Inventory increases lagged behind average levels as a cold front that brought freezing weather to parts of the Midwest and Northeast in mid-April was a continuation of the frosty winter that plagued much of the U.S. and sent fuel demand soaring. About 49 percent of households use gas for heating, according to the EIA.

Coldest March

Last month was the coldest March since 2002 in the contiguous 48 states, the National Climatic Data Center said, while gas demand in January was the highest on record at 104 billion cubic feet a day, according to the EIA.

The cold weather upended a seasonal trading strategy that held for the previous five years, when gas futures fell an average of 19 percent from the start of the year to early April. Prices this year climbed 12 percent through April 17.

Long wagers on four U.S. natural gas contracts rose 1.1 percent to 629,109 while short positions declined 0.5 percent to 203,099, CFTC data show. The measure includes an index of four contracts adjusted to futures equivalents: Nymex natural gas futures, Nymex Henry Hub Swap Futures, Nymex ClearPort Henry Hub Penultimate Swaps and the ICE Futures U.S. Henry Hub contract.

Hedge funds increased their bullish bets on West Texas Intermediate for a third straight week.

Net-long positions in the U.S. benchmark crude held by money managers, including hedge funds, commodity pools and commodity-trading advisers, rose by 3.1 percent to 341,477, according to the CFTC. Long positions gained by 10,876 to 365,619, the most since March 4, while shorts rose by 455 to 24,142, the first increase in three weeks.

Crude Prices

Crude rose $1.19, or 1.2 percent, to $103.75 a barrel on the Nymex in the report week. Prices increased 54 cents to $104.30 on April 17.

Net-long bets on gasoline climbed by 15,929 futures and options combined, or 28 percent, to 73,525, the most since April 2, 2013, the CFTC data showed.

Futures advanced 6.2 cents, or 2.1 percent, in the reporting period to $3.0421 a gallon on the Nymex. The contract rose 1.42 cents to $3.0547 on April 17.

Regular gasoline at the pump, averaged nationwide, increased 0.6 cent to $3.663 a gallon April 17, the highest since July 22, according to Heathrow, Florida-based AAA, the largest U.S. motoring group. The price has climbed every day since March 21.

Money managers’ bullish wagers on ultra low sulfur diesel, a category that includes heating oil, surged 5,074 futures and options combined, or 34 percent, to 20,139. The fuel gained 5.26 cents, or 1.8 percent, to $2.987 a gallon in the report week. The contract settled at $3.0082 on April 17.

Marketed Gas

U.S. marketed natural-gas production may increase 3 percent in 2014 from a record last year to 72.29 billion cubic feet a day as new wells come online at the Marcellus shale deposit in the Northeast, according to the EIA. Output has climbed every year since 2005. The U.S. met 87 percent of its energy needs in 2013, the highest since 1985.

The government agency estimates that a record 2.6 trillion cubic feet will flow into storage to reach its projection for 3.422 trillion by the end of October, which would be the lowest level for the time of the year since 2008.

“The market has the potential to trade significantly higher because we are coming off of the lowest storage levels since 2003,” said Tim Evans, an energy analyst at Citi Futures Perspective in New York. “We need to have average storage injections 25 percent above the five-year average rate. The longer before we start that process, the more we are going to have to scramble to even do that.”

To contact the reporter on this story: Naureen S. Malik in New York at nmalik28@bloomberg.net

To contact the editors responsible for this story: Dan Stets at dstets@bloomberg.net Bill Banker

®2014 BLOOMBERG L.P. ALL RIGHTS RESERVED.

Asian Stocks Rise as U.S. Data Overshadow China Slowdown By Yoshiaki Nohara - Apr 18, 2014

Asian stocks rose this week after U.S. data and earnings boosted optimism about the world’s biggest economy while further signs of slowdown in Chinastoked speculation the government will add stimulus to stabilize growth.

The MSCI Asia Pacific Index gained 0.9 percent to 139.16 this week. U.S. industrial production increased more than forecast in March and Federal Reserve Chair Janet Yellen said the central bank remains committed to supporting the recovery.

“Confidence grew about the global economy and that was the No. 1 driver for the market,” said Junya Naruse, chief strategist at Daiwa Securities Group Inc., Japan’s second-largest brokerage. “Shares have yet to start a strong rally, but investors are getting confident that at least downside risk has receded.”

Man Wah Holdings Ltd. (1999), a sofa maker that gets half its sales from the U.S., surged 5.9 percent in Hong Kong after saying it expects higher profit. SoftBank Corp. (9984), which owns about 37 percent of Alibaba Group Holding Ltd., soared 10 percent in Tokyo after Alibaba’s quarterly profit more than doubled ahead of a planned U.S. initial public offering. CapitaMalls Asia Ltd. jumped a record 21 percent in Singapore after CapitaLand Ltd., Southeast Asia’s biggest developer, offered to buy out investors in its mall unit.

Chinese Shares

The Hang Seng China Enterprises Index of mainland companies listed in Hong Kong, also known as the H-share index, dropped 1.4 percent this week. Hong Kong’s Hang Seng Index declined 1.1 percent. The Shanghai Composite Index lost 1.5 percent.

China’s gross domestic product rose 7.4 percent from a year earlier in the January-to-March period, the statistics bureau said on April 16, the weakest pace of expansion in six quarters. Aggregate financing, the broadest measure of new credit, was 2.07 trillion yuan ($333 billion) in March, the People’s Bank of China said on April 15, down from 2.55 trillion yuan a year earlier.

China will lower reserve ratios at “qualified” rural banks in order to provide more funds to agriculture-related industries, according to a statement on the government website yesterday, citing a State Council meeting chaired by Premier Li Keqiang. He also said the nation isn’t considering “strong” stimulus, and reiterated that economic growth a bit higher or lower than 7.5 percent is within a reasonable range.

Japan’s Topix index added 3.5 percent as the yen weakened. The Cabinet Office cut its economic view this month for the first time since Prime Minister Shinzo Abe came to power in 2012, citing the sales-tax increase at the start of the month.

South Korea’s Kospi index gained 0.3 percent. Australia’s S&P/ASX 200 Index advanced 0.5 percent, while New Zealand’s NZX 50 Index added 0.2 percent. Singapore’s Straits Times Index climbed 1.7 percent, and Taiwan’s Taiex Index increased 0.7 percent. Markets in Hong Kong, Singapore, Australia and New Zealand were closed for a holiday yesterday.

U.S. Production

U.S. industrial production climbed 0.7 percent in March after a revised 1.2 percent increase the prior month that was twice as big as previously forecast, figures from the Federal Reserve showed on April 16.

Man Wah jumped 5.9 percent to HK$13.18 after saying it expects a “significant” increase in net income for the 12 months ended March 31.

The Fed has a “continuing commitment” to support the recovery even as policy makers now see the U.S. reaching full employment by late 2016, Yellen said this week. Investors should pay attention to shortfalls in both inflation and the jobless rate for signals on the Federal Open Market Committee’s decisions on the policy rate, she said.

The central bank announced last month a $10 billion reduction in monthly bond buying to $55 billion and repeated that it will taper purchases “in further measured steps.”

The Standard & Poor’s 500 Index increased 2.7 percent this week on signs of strength in the economy as well as earnings reports from General Electric Co. to Morgan Stanley that beat estimates. Tech shares rallied as Yahoo! Inc.’s results were boosted by Alibaba, in which it holds a 24 percent stake.

SoftBank soared 10 percent 7,623 yen after Alibaba posted $1.35 billion in fourth-quarter net income. The jump in profit drove the estimated valuation for China’s largest e-commerce company 9.8 percent higher to $168 billion, based on a Bloomberg survey of analysts. Alibaba last month began the process for a U.S. IPO that may be larger than the $16 billion raised when Facebook Inc. went public in 2012.

CapitaMalls Jumps

CapitaMalls Asia soared 21 percent to S$2.19 after CapitaLand offered to take its shopping-center unit private for about S$3.06 billion ($2.4 billion) to boost shareholder value. Shares of the parent company climbed 8.9 percent to S$3.18.

GungHo Online Entertainment Inc. surged 13 percent to 590 yen in Tokyo after the Nikkei newspaper reported the Internet-game maker’s operating profit rose.

The MSCI Asia-Pacific gauge ended the week trading at 12.65 times estimated earnings, compared with multiples of 15.9 for the S&P 500 and 14.6 for the Stoxx Europe 600 Index, according to data compiled by Bloomberg.

To contact the reporter on this story: Yoshiaki Nohara in Tokyo at ynohara1@bloomberg.net

To contact the editors responsible for this story: Sarah McDonald at smcdonald23@bloomberg.net Jim Powell, Jim McDonald

®2014 BLOOMBERG L.P. ALL RIGHTS RESERVED.

India’s Sensex Ends Three-Day Drop as Lenders, Carmakers Rally By Rajhkumar K Shaaw - Apr 17, 2014

India’s benchmark stock index rallied for the first time in four days led by shares of lenders and automakers.

Tata Motors Ltd. (TTMT), the owner of Jaguar Land Rover, soared the most in five months. ICICI Bank Ltd. (ICICIBC), the country’s second-biggest lender, advanced to its highest level since November 2010. Tata Consultancy Services Ltd. (TCS), India’s largest software exporter, led an advance among peers after profit in the last quarter rose 51 percent.

The S&P BSE Sensex (SENSEX) jumped 1.6 percent to 22,628.84 at the close in Mumbai, erasing the weekly loss. Indian markets are closed tomorrow for the Good Friday holiday. The gauge fell for three consecutive days after climbing to a record on April 10.

“The market is continuing its run after some profit booking,” V.K. Vijayakumar, an investment strategist at Geojit BNP Paribas Financial Services Ltd. in the southern Indian state of Kerala, said in a phone interview today. “Some investors had gone short, and now may have been forced to cover. Thus we saw such a sharp bounce-back.” He expects indexes to rally at least 10 percent if a strong government comes to power after election results are announced May 16.

The Sensex is the best performer among the largest emerging markets this year on expectations a victory by the opposition Bharatiya Janata Party will produce a government with a mandate to spur economic growth. Overseas investors have bought a net $4.8 billion of local shares this year, the most inAsia, data compiled by Bloomberg show.

Elections, Inflation

Several opinion polls have projected the coalition led by the BJP will win the general election for the 543-seat lower house of India’s parliament. For the first time, a poll earlier this week found that the coalition may win an outright majority.

India’s elections, the world’s biggest-ever exercise in democracy, began on April 7 and will end on May 12 after nine phases of voting. Counting will take place on May 16.

Investors may have been prompted to sell shares over the past three days after data showed inflation accelerated and factory output declined, according to CNI Research Ltd.

India’s wholesale-price index rose 5.7 percent in March, the most in three months, official figures released April 15 showed. Consumer prices climbed 8.31 percent in March from a year earlier, government data showed. Industrial production contracted 1.9 percent in February from a year earlier, the biggest slide since May, separate data showed on April 11.

Reserve Bank of India Governor Raghuram Rajan has raised the benchmark interest rate 75 basis points since taking charge in September to curb price rises. The next policy review is due June 3.

Tata Motors, ICICI

Tata Motors rallied 4.4 percent, the most since Nov. 14. Mahindra & Mahindra Ltd. (MM), India’s largest maker of sport-utility vehicles and tractors, rose 2.1 percent, ending a four-day decline.

ICICI Bank added 3.3 percent to its highest level since Nov. 5, 2010. State Bank of India Ltd., the nation’s biggest lender, increased 3 percent, the most since April 9.

Tata Consultancy gained 1.2 percent. The company reported after markets closed yesterday that net income jumped 51 percent in the three months ended March 31. Infosys Ltd., the second-biggest software services exporter, forecast on April 15 full-year sales growth that beat analysts estimates, while Wipro Ltd. may report today net income rose more than 20 percent.

Infosys gained 1.1 percent, while Wipro (WPRO) added 2.4 percent.

TCS, Wipro

Tata Consultancy profit rose to 53 billion rupees ($879 million), compared with the 52.4 billion-rupee median estimate of 39 analysts surveyed by Bloomberg. The company predicts growth will be stronger this year as customers in the U.S. and Europe, as well as the Asia Pacific region, outsource more work.

Wipro, the country’s third-largest software services company by market capitalization, reported after the close of trading today that profit rose 29 percent to 22.3 billion rupees in the last quarter, beating estimates of 21 billion rupees.

“We are in a massive bull run for the next four years, said B.P. Singh, chief investment officer for equities at Pramerica Asset Managers Pvt. Higher corporate profits are driving the rally, he said.

The Sensex has risen 6.9 percent so far in 2014 and trades at 14.3 times projected 12-month profits, in line with the average multiple over the past five years. The MSCI Emerging Markets Index has gained 0.3 percent in 2014 and is valued at 10.5 times.

Overseas investors sold a net $15.4 million of Indian shares on April 15, a second day of sales and the first consecutive outflow since February.

To contact the reporter on this story: Rajhkumar K Shaaw in Mumbai at rshaaw@bloomberg.net

To contact the editors responsible for this story: Michael Patterson at mpatterson10@bloomberg.net Dick Schumacher

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Tata Consultancy Predicts Stronger Growth on Outsourcing By Anoop Agrawal and Bianca Vázquez Toness - Apr 16, 2014

Tata Consultancy Services Ltd. (TCS), India’s largest software exporter, predicts growth will be stronger this year as customers in the U.S. and Europe, as well as the Asia Pacific region outsource more work.

“We are exiting the year with a great growth momentum,” Chief Executive Officer N. Chandrasekaran said yesterday after the company reported a 51 percent jump in fourth-quarter profit. “If you look at what clients are telling us, if you look at the deal pipeline, deal closures, order book, sentiment, and the discretionary spend, taking all of this we believe FY15 will be a stronger year.”

Net income rose to 53 billion rupees ($879 million) in the three months ended March, Mumbai-based Tata Consultancy said. That compares with the 52.4 billion-rupee median of 39 analysts’ estimates compiled by Bloomberg.

Tata Consultancy joins competitor Infosys Ltd. (INFO) in posting earnings that beat estimates as more companies spend on cloud-based solutions, mobility and data analytics. Sales growth at Tata Consultancy will be stronger in the fiscal year that started April 1 than the prior 12 months as customers in the financial services, retail and life sciences industries step up technology spending, according to Chandrasekaran.

“We expect the stock to react positively,” said Ravi Menon, assistant vice president at Centrum Broking Pvt. in Mumbai. “People were concerned if there is an industrywide softness in demand. TCS has said they don’t see any weakness in the retail or high-tech verticals. In fact, they are seeing clients spending on digital in these two verticals.”

Tata Consultancy declined 2.5 percent to 2,196.30 rupees in Mumbai trading yesterday, before the earnings release. The benchmark S&P BSE Sensex Index fell 0.9 percent. The stock has climbed 48 percent in the past 12 months, compared with a 38 percent gain for Infosys and the Sensex’s 19 percent increase.

Contract Wins

Revenue at Tata Consultancy rose to 215.5 billion rupees, from 164.3 billion rupees a year earlier. That compared with the 216.9 billion-rupee median of 41 analysts’ estimates.

The software-services provider, which last month said the fourth quarter was “seasonally weak” amid slowing demand in India ahead of general elections, expects the home market to stay “soft” for longer, Chandrasekaran said. “We think that India from the current levels will improve. We’re going to wait for the first two quarters.”

The company, which has won contracts from India’s Department of Posts and the tax office, got 7.8 percent of sales from the home market in the year ended March 2013. Voting in India’s general elections, which began April 7, will conclude May 12 and ballots will be counted May 16.

Discretionary Budget

Tata Consultancy, which maintains computers and provides software and outsourcing services for companies including Citigroup Inc. and France’sGDF Suez SA (GSZ), won nine large deals in the last quarter. Contracts included one with a European utility to transform customer service processes and a multiyear, multimillion dollar order from a North American drugmaker, the company said.

Companies are investing in technology to simplify business processes and drive efficiency, Chandrasekaran said yesterday. “There is a discretionary budget that is going towards digital that we are hearing across the board, and we are engaged with our clients in the area. The third area of spend is regulatory changes, governance, security, controls and risk management.”

Demand Recovery

Worldwide information technology services spending will climb 3.7 percent to $671 billion in 2014, accelerating from 2.8 percent growth last year, according to market researcher IDC.

“We maintain our thesis of an industrywide demand recovery” in the current fiscal year, driven by a spending recovery at U.S. banking and financial services companies, Nitin Jain, an analyst at Ambit Capital Pvt. in Mumbai, wrote in an April 7 report. Demand will also be bolstered by an increased offshoring trend in Europe and greater acceptance of social media, mobility, analytics and cloud, Jain wrote.

Infosys, India’s second-largest software-services exporter, on April 15 forecast full-year sales growth that beat analyst estimates. Revenue in the 12 months started April 1 will climb 7 percent to 9 percent in U.S. dollar terms, Infosys said, faster than the 6 percent to 8.3 percent average of six analysts’ estimates compiled by Bloomberg.

To contact the reporters on this story: Bianca Vázquez Toness in New Delhi at btoness@bloomberg.net; Anoop Agrawal in Mumbai ataagrawal8@bloomberg.net

To contact the editors responsible for this story: Robert Fenner at rfenner@bloomberg.net Suresh Seshadri, David Risser

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