India shares to drop as US bailout in chaos
Saturday, 27 September 2008

Reuters, Bangalore– The BSE Sensex is set to fall on Friday, tracking lower Asian markets after the US government's $700 billion bailout plan to revive the financial sector stalled.

Sentiment will also be dented by the collapse of Washington Mutual Inc in the biggest ever US bank failure.
 
JPMorgan Chase & Co bought certain Washington Mutual assets for $1.9 billion after the largest US savings and loan was closed overnight by a US regulator.
 
"Our market is expected to open 150 to 200 points down because of the weakness in the Asian markets," said S.P. Tulsian, an independent investment consultant. "If the bailout package really gets stalled then it will be cause for major weakness."
 
Traders said below normal rollover of the September derivatives contract, which expired on Thursday, indicated the market's softer underbelly amid the global financial sector turmoil.
 
Annual inflation was unchanged at 12.14 percent on Sept. 13, compared with a week earlier and below a Reuters forecast of 12.23 percent, according to data after market closed on Thursday.
 
Economists said volatile oil prices, which were below $107 a barrel on Friday, and the chance of a spike in some food costs would force the Reserve Bank of India to keep policy tight.
 
On Thursday, the main 30-share BSE index fell 1.06 percent to 13,547.18, its lowest close in a week. The index is down a third in 2008, with the withdrawal of more than $9 billion by foreign institutional funds a key factor.
 
By 0342 GMT, Japan's Nikkei was down 0.9 percent, Hong Kong was trading 1.8 percent lower and MSCI's measure of other Asian stocks was down 1.3 percent.
 
Nifty futures traded in Singapore fell 50 points.
 
STOCKS TO WATCH
 
* Unitech Ltd after the property firm said it received radio spectrum to start mobile services in Gujarat and Uttar Pradesh.
 
* Indiabulls Securities after it said it would take a 24.5 percent stake in Indiabulls Life Insurance Co, a joint venture between group firm Indiabulls Financial Services
 
and a unit of France's Societe Generale.
 
* State-run Rashtriya Chemicals and Fertilizers Ltd after a government official said it was in talks with a South African firm and IDC of Mozambique to set up a $2 billion
 
fertiliser plant in Mozambique.
 
* Pressure cooker maker TTK Prestige Ltd, after it received approval from shareholders for delisting its shares from the Mumbai and national stock exchanges.

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