Jan 18, 2003|
Global markets: Tech sector blues
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.
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.
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.
More Views on News
Jun 10, 2017
Forty Indian investing gurus, as worthy of imitation as the legendary Peter Lynch, can help you get rich in the stock market.
Aug 19, 2017
Ever heard of Lindy Effect? Find out how you can use it to pick timeless stocks.
Aug 18, 2017
Buying the index now will hardly help make money in stocks even in ten years.
Aug 18, 2017
Donald J Trump, a wrasslin' fan, took a 'Holy Sh*t!' blow on Tuesday.
Aug 17, 2017
PersonalFN simplifies the mutual fund account statement for you.
More Views on News
Aug 7, 2017
The data tells us quite a different story from the one the government is trying to project.
Aug 10, 2017
Don't miss these proxy bets on growing companies or in a few years you will be looking back with regret.
Aug 8, 2017
Bharat-22 is one of the most diverse ETFs offered so far by the Government. Know here if you should invest...
Aug 12, 2017
The India VIX is up 36% in the last week. Fear has gone up but is still low by historical standards.
Aug 7, 2017
Raksha Bandhan signifies the brother-sister bond. Here are 7 thoughtful financial gifts for sisters...
Copyright © Equitymaster Agora Research Private Limited. All rights reserved.
Any act of copying, reproducing or distributing this newsletter whether wholly or in part, for any purpose without the permission of Equitymaster is strictly prohibited and shall be deemed to be copyright infringement. LEGAL DISCLAIMER:
Equitymaster Agora Research Private Limited (hereinafter referred as 'Equitymaster') is an independent equity research Company. Equitymaster is not an Investment Adviser. Information herein should be regarded as a resource only and should be used at one's own risk. This is not an offer to sell or solicitation to buy any securities and Equitymaster will not be liable for any losses incurred or investment(s) made or decisions taken/or not taken based on the information provided herein. Information contained herein does not constitute investment advice or a personal recommendation or take into account the particular investment objectives, financial situations, or needs of individual subscribers. Before acting on any recommendation, subscribers should consider whether it is suitable for their particular circumstances and, if necessary, seek an independent professional advice. This is not directed for access or use by anyone in a country, especially, USA or Canada, where such use or access is unlawful or which may subject Equitymaster or its affiliates to any registration or licensing requirement. All content and information is provided on an 'As Is' basis by Equitymaster. Information herein is believed to be reliable but Equitymaster does not warrant its completeness or accuracy and expressly disclaims all warranties and conditions of any kind, whether express or implied. Equitymaster may hold shares in the company/ies discussed herein. As a condition to accessing Equitymaster content and website, you agree to our Terms and Conditions of Use, available here
. The performance data quoted represents past performance and does not guarantee future results.SEBI (Research Analysts) Regulations 2014, Registration No. INH000000537.
Equitymaster Agora Research Private Limited. 103, Regent Chambers, Above Status Restaurant, Nariman Point, Mumbai - 400 021. India.
Telephone: +91-22-61434055. Fax: +91-22-22028550. Email: firstname.lastname@example.org. Website: www.equitymaster.com. CIN:U74999MH2007PTC175407