Sep 6, 2003|
Global markets: Green everywhere
US indices gained ground during the week and continued their upward journey for the year. While the Dow gained about 1%, the NASDAQ closed even higher by about 3% during the week. Gains on the indices were primarily led by improving sentiment towards technology stocks. The week was a short one as Monday was a holiday on account of Labour Day.
Market opened the week on a positive note with increasing interest towards technology stocks. Dell reported that its revenues from China might grow by 3 times the growth rate of the country's entire personal computer market in FY04. Sentiments improved further on Tuesday when positive news came in regarding the manufacturing sector. The Institute of Supply Management reported a rise in manufacturing index. On Wednesday, indices gained ground further. Positive reports on the economy front regarding construction spending aided gains on the indices apart from tech led buying. However weak reports on auto sales and news that the New York Attorney General accused four of the largest US mutual funds for illegal practices failed to dampen investor sentiments and markets continued their upward journey.
On Thursday, markets moved up further on account of positive reports on the economy. While factory orders witnessed a rise during the month of July, reading on productivity for the second quarter was revised upwards. This apart, Institute of Supply Management reports on service was also better than expected. Poor weekly unemployment numbers released during the week failed to dampen sentiments on that day. However profit booking was witnessed on Friday with selling pressure aided by weak economic reports from the labor markets.
Indian ADRs gained ground during the week barring some weakness in ICICI Bank (4%), Dr. Reddy's (2%) and MTNL (2%). The top five gainers were technology ADRs. It should be noted that optimism towards technology stocks rose during the week on the US indices. The same can be witnessed from the gains on the Indian technology ADRs. Top gainers for the week included Infosys (18%), Rediff (13%), Wipro (12%) and Satyam (11%).
Globally the optimism is on a rise as far as the stock markets are concerned. This can be reflected from the gains witnessed during the week across the major indices in the world. It should also be noted that most of these indices are trading at their higher levels for the current year. Top gainers this week, included the Dax (4%) of Europe, the Nikkei (3%) of Japan, the BSE Sensex (3%) of India and the NASDAQ (3%) of the US. In Europe reports indicating that both the manufacturing and services sector are witnessing growth at a faster pace led to increased optimism towards the stock markets. Much of the rally is based on hopes of recovery in the world's largest economy, the US, during the second half of the current financial year. However one must exercise caution on this front, as there are no clear signs of recovery till date.
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