Mar 8, 2003|
Caution is the watchword
The Dow closed with losses of 1.9%, while the Nasdaq shed 2.4% during the week. An uncertain economic outlook, terror threats and the possible US-Iraq conflict keep investors away from equities. However, with the capture of Khalid Shaikh Mohammed, No.3 at Al-Queda, the focus shifted from possible terror attacks against the US to economic numbers.
Monday saw markets heading south, on the back of bleak economic numbers. The Institute for Supply Managementís (ISMís) index for manufactures grew at a much slower pace for the month of February compared to expectations. Further, numbers tracking personal spending also reported a dip. The selling continued on Tuesday. However, weak business outlook from corporates like GM and Walt Disney were responsible for the selling this time. Infact, heavy equipment manufacturer, Caterpillar, indicated that it expects the industry and its sales growth for FY03 to be flat.
ISMís numbers for the service sector came in much stronger than expected on Wednesday. This triggered a relief rally. Not surprisingly, key gainers of the rally were software majors like Microsoft and Oracle. However, this was only a lull before the storm. On the back of negative news on the employment front (number of unemployed rose), markets witnessed a sell off. The Dow closed lower by 101 points and the Nasdaq shed 11 points. However, with Mr. Hans Blix, the chief weapons inspector, asking for more time and therefore, effectively delaying the US-Iraq conflict, markets made staged a come back on Friday.
Tech leading the charge south
|(Price in US $)
With possibility of a war hurting business sentiment, technology majors like Infosys, Satyam and Wipro were the key loserís amongst the Indian ADRs for the week. Silverline had the distinction of topping the loserís list. The stock also figured amongst the top ten losers from the BSE ĎAí group on the Indian bourses. Other ADRís fell prey to the pessimism seen on the Indian bourses.
The markets, globally, continued to be weak with the European and the Indian market being the worst hit. Going forward, it is likely to remain range bound on the back of a sluggish global economy. Further, the war clouds looming on the horizon will continue to keep investors at bay.
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