The Hindu Business Line : IT counters, Tata Motors plummet

The major Wall Street indexes lost ground in a choppy week of ups and downs amidst hopes of a massive rescue plan by the Government. The Dow Jones Industrial Average fell 2.15 per cent on the week and the broad-market S&P-500 index slid 3.33 per cent; the technology-heavy Nasdaq composite tumbled 3.98 per cent.

But fall was quite huge in the domestic bourses, as foreign investors continued their heavy selling. The BSE Sensex crashed by 6.7 per cent and the NSE’s S&P CNX Nifty fell by 6.12 per cent.

Most of the ADRs also witnessed sharp falls. Among them, infotech counters were the worst-affected. Infosys Technologies plummeted by 14.5 per cent at $33.61 against the previous week close of $38.5. Satyam fell 9.4 per cent at $17.83 ($19.51), Patni Computer lost 11.7 per cent at $7.59 ($8.48) and Wipro declined by 11.6 per cent at $10.25 ($11.44). Fears that the US financial crisis could affect the outsourcing and revenues for Indian IT companies seemed to have affected the stock market.

However, the week’s biggest loser was Tata Motors, whose ADR tumbled by 16.8 per cent at $8.4 ($9.81).

Tata Motors, in its filing for the rights issue, reported the financial performance of JLR, which reported a net loss of $383 million for January-June 2008. This revelation appeared to have impacted the stock negatively. Meanwhile, the upcoming Tata Motors rights issue will be the first in the country where existing investors will have to commit funds as soon as they apply for shares — following SEBI’s decision to make the issue a pilot case for the Applications Supported by Blocked Amount concept.

ICICI Bank was the other counter to witness sharp fall, as its ADR tumbled by 12.2 per cent at $24.84 ($27.99). The other banking major, HDFC Bank, however, ended with a gain of 0.86 per cent at $91.49 ($90.7).

This week’s star performer was MTNL, whose ADR jumped by 5.27 per cent at $4.36 ($4.13). Tata Communications also ended in the green with a gain of 2.2 per cent at $21.35 (20.88).

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