Sep 11, 2004|
Global markets: Tech steals the show
Good old bargain hunting returned to the fore on the US bourses this week as investors lapped up tech stocks, which had seen some battering in recent times. As a consequence, while Nasdaq gained 3% for the week, Dow's gains were rather muted at 1%.
Last week, the tech laden Nasdaq had come in for some significant selling, led primarily by profit warnings from chip giant Intel. However, as is the case on most number of occasions, sentiments had prevailed over rationality and tech stocks had started looking a wee bit attractive for most part of this week. Also, with Dow gaining for four weeks in a row, the time was apt for some amount of sector rotation. As a result, some shuffling of portfolios in favor of Nasdaq resulted into the index gaining a handsome 3% during the week. A federal judge appeal in favor of tech giant Oracle also added to the momentum in tech stocks. However, some market observers seem to be skeptical about the continuation of rally and hence would not be surprised to see some selling next week.
Barring UK benchmark, FTSE, other indices across the globe also edged higher for the week. However with gains of almost 3%, Indian benchmark BSE left all others in the shade and emerged as the highest gainer. While there have been no encouraging news on macroeconomic front, the buying momentum seems largely a result of expectations of strong 2QFY05 performance from India Inc. Elsewhere in Asia, while Japanese benchmark was down on the last trading day of the week, the decline was not enough to reverse the gains witnessed earlier in the week. The European indices had a mixed outing as while Dax, the German index gained nearly 1%, its UK counterpart witnessed marginal decline.
Barring weakness in telecom sector scrips, Indian ADRs remained buoyant throughout the week. Edging higher by a handsome 17%, dotcom major Sify emerged as the highest gainer during the week. For the second week in a row, tech ADRs witnessed robust gains. Despite their impressive growth in the past few years, Indian IT services markets represent a mere 1.6% of the total global market and this signifies the sector's huge potential going forward which would ultimately benefit the major tech players. Significant buying was also witnessed among pharma major Dr Reddy and banking ADRs.
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