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Money News

Reliance drags shares on arbitration setback; metal stocks fall

BENGALURU (Reuters) - Indian shares ended lower on Monday as Reliance Industries fell to its lowest since August after a Singapore arbitration panel put its deal for Future Group assets on hold, while metal and auto stocks also contributed to losses.

FILE PHOTO: A man walks past the Bombay Stock Exchange (BSE) building in Mumbai, India, March 6, 2020. REUTERS/Francis Mascarenhas/File photo

The NSE Nifty 50 index fell 1.36% to 11,767.75, while the S&P BSE Sensex was down 1.33% at 40,145.5.

Reliance fell as much as 4.47% to its lowest level since Aug. 4, after Amazon.com Inc won an interim order in Singapore to pause Future Group’s $3.38 billion asset sale to India’s most valuable company.

Amazon has alleged the deal breached the terms of its stake purchase in Future Coupons Ltd, which owns a 7.3% stake in Future Retail.

“The reaction to Reliance is purely driven by sentiment,” said Ajit Mishra, vice president at Religare Broking in Mumbai.

“There is not much to worry as a Reliance investor and the deal stalling affects Future Group more.”

Shares of Future Retail dropped as much as 8.48% and the company said it would take steps in enforcement proceedings to close the deal without delay.

Among sectors, The Nifty metals index fell as much as 4.57% and the Nifty Auto index skid as much as 3.6%

Motorcycle makers Hero Motocorp and Bajaj Auto fell 6.72% and 6%, respectively. Miner Hindalco fell about 5.6%.

Among gainers, private-sector lender Kotak Mahindra Bank was up about 2.7% after the company reported a September-quarter profit that beat estimates.

U.S. Secretary of State Mike Pompeo arrived in India and kicked off his five-day Asian trip aimed strengthening ties with countries in the face of rising Chinese influence across the region.

Reporting by Derek Francis in Bengaluru; Editing by Shailesh Kuber

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