Global markets: Tech sector blues - Views on News from Equitymaster

Helping You Build Wealth With Honest Research
Since 1996. Try Now

  • MyStocks

MEMBER'S LOGINX

     
Login Failure
   
     
   
     
 
 
 
(Please do not use this option on a public machine)
 
     
 
 
 
  Sign Up | Forgot Password?  

Global markets: Tech sector blues

Jan 18, 2003

US markets remained volatile for most part of the week and finally closed in the red for the week. The Dow fell by over 2% while the NASDAQ fell by nearly 5%. Most of the fall in the NASDAQ was seen in on Friday. The main highlight of the week was result announcement from the IT sector. Microsoft, Intel, IBM, Sun Microsystems and Yahoo were among the prominent tech sector majors who announced their results this week. Microsoft's results were the most anticipated. Intel was the first to announce its results. While the results were better than expected the business forecast by Intel management was lackluster. Microsoft reported better than expected quarterly earnings figures for its second quarter yesterday, sales figures were however marginally below expectations. Expectations from the management for the whole year however, were not encouraging and this led to a fall in its stock prices. Both IBM and Sun Microsystems reported results, largely in line with market expectations. While the results were in line with expectations they are worse off than last year's performance. Fall in the NASDAQ on Friday was mainly due to the poor business outlook issued by the Microsoft management. Though most of the tech sector results have been better than the lowered estimates there is no clear indication of a revival in the tech sector. Markets could exhibit volatility in the coming weeks too, mainly due to weak corporate earnings reports as well as the Iraq impasse.

Indices 11-Jan-03 18-Jan-03 Change
FTSE 3,974 3,821 -3.9%
Japanese Nikkei 8,470 8,690 2.6%
BSE-Sensex 3,358 3,370 0.4%
Hang Seng 9,722 9,615 -1.1%
NASDAQ 1,448 1,376 -4.9%
Dow 8,785 8,586 -2.3%
Dax 3,037 2,919 -3.9%

Major global indices except the Indian BSE-Sensex and the Japanese Nikkei were in the red compared to last week. Geopolitical uncertainty has forced investors to take a re-look at their portfolio. Investors are now looking at other options like gold to hedge against the uncertainty. Indian markets on the other hand were buoyed mainly due to strength in the banking, Pharma and PSU counters . Software counters were weak after Wipro reported its results. While the sales figures exceeded expectations, earnings were a bit lackluster. Infosys, on other hand bounced back during the week after losing ground due to lower than expected earnings numbers. FIIs have invested close to Rs 6 bn in the current week, which has led to the Sensex closing in the positive for the week.

(Price in US $) 11-Jan-03 18-Jan-03 Change
Satyam Infoway 4.1 4.1 0.5%
ICICI Bank 6.5 6.8 4.8%
Dr. Reddy's 20.8 20.4 -2.0%
Wipro 32.9 31.5 -4.1%
VSNL 3.6 3.7 1.4%
MTNL 3.7 3.8 3.2%
Infosys 69 68.6 -0.7%
Rediff 2.3 3.4 47.8%
HDFC Bank 13.9 13.9 0.1%
Satyam 12.1 12.2 0.7%
Silverline 0.7 0.8 7.1%

Amongst Indian ADRs, ICICI Bank stands out as the key gainer. The Bank is expected to announce its results this month. The stock has been gaining in anticipation of announcement of its quarterly results. Also positive news from the India has further buoyed the counter. The bank has aggressively cut home loan rates in order to capture a larger pie in the same. ICICI Bank is aggressively targeting the retail and this is likely to be the main growth driver for the bank. HDFC Bank has also gained marginally in the week after it announced robust quarterly results figures. The counter had been running up since last week and it seems to have stabilized at this level. Software ADRs on the other hand were weak with the exception of Satyam. Wipro's lackluster results were the main reason for the gloomy sentiment. Performance of Indian ADRs in the short term is more likely to be dependent on news flows form the Indian subcontinent, rather than fundamentals of the US markets.


Equitymaster requests your view! Post a comment on "Global markets: Tech sector blues". Click here!

  

More Views on News

An Important Hurricane Update for Energy Traders (Fast Profits Daily)

Sep 22, 2020

In this video, I'll show you how the extended hurricane season in the US will affect traders in crude oil and natural gas.

Mutual Fund Investors Will Now Be Allotted Units Based on NAV of the Day AMCs Receive Funds (Outside View)

Sep 22, 2020

PersonalFN explains how SEBI's new circular on mutual funds impact investors.

My Top Stock to Buy in this Market Selloff (Profit Hunter)

Sep 22, 2020

The recent correction offers a great opportunity to buy this high conviction smallcap stock.

How Much Money Should an Investor Set Aside for Trading? (Fast Profits Daily)

Sep 21, 2020

In this video, I'll give you a simple equation which you can use to decide how much money you can set aside for trading.

Kotak Standard Multicap Fund: Strategizing Growth with Focused Approach (Outside View)

Sep 21, 2020

PersonalFN's analysis on the features and performance of Kotak Standard Multicap Fund.

More Views on News

Most Popular

How the 8-Year Cycle Can Help Identify Multibaggers (Fast Profits Daily)

Sep 11, 2020

This is how you can apply the greed and fear cycle in the market to pick stocks.

Why am I Recommending Caution? (Fast Profits Daily)

Sep 9, 2020

This is why I have changed my short-term view on the market.

Why We Picked This Small-cap Stock for Our Hidden Treasure Subscribers (Profit Hunter)

Sep 17, 2020

This leading household brand will profit big time in a post covid world.

This Could Be the Best September for Auto Stocks (Profit Hunter)

Sep 11, 2020

Here's why I think this month could be a great for auto stocks.

More

Covid-19 Proof
Multibagger Stocks

Covid19 Proof Multibaggers
Get this special report, authored by Equitymaster's top analysts now!
We will never sell or rent your email id.
Please read our Terms

S&P BSE SENSEX


Sep 22, 2020 03:37 PM

MARKET STATS