Nov 27, 2004|
Global markets: ADRís up and running
All the major US indices closed with modest gains in a shorter trading week thanks to ĎThanksgiving Dayí. The Dow and S&P 500 have advanced for five and six weeks respectively in succession. For the week ended November 26, 2004, Nasdaq was up 1.5%, while Dow was up 0.6%.
While the week started on strong note with gains in technology stock, Tuesday ended rather flat with investors reacting to changes in the oil prices and dollar. Indices made further move on Wednesday, as tech rally picked up some steam in the last hour of trading. While new home sales grew at 1.2 m units, jobless claims were lesser in the month of October. Also, the consumer sentiment was up to 92.8 compared 91.7 in October survey, which also gives a better picture of the US economy.
Markets across the world remained more or less flat with the exception of the Japanese benchmark, Nikkei, which fell sharply by 2.2% mainly due to weakening of dollar. While steel and shipping stocks on Nikkei rose due to strength in steel prices and shipping freights, other stocks tumbled on concerns over fall in exports earnings due to weak dollar. Also, stocks in European markets traded lacklustre with drug makers falling due to weakening of dollar. The profit of these companies will have impact due to falling dollar as the US markets consume more than 50% of the total global drug consumption.
|(Price in US$)
Across the board buying was witnessed among Indian ADRs during the week. Telecom major VSNL led the charge among gainers with gains of 15% while on the other hand, dotcom major Rediff, closed 12% higher. ICICI Bank, Wipro and MTNL were among the other gainers with gains of 5% each. Gains in VSNL, the countryís largest ILD player is probably a continuation of revived interest in the stock post its acquisition of Tyco global network for a sum of around Rs 6 bn. On the other hand, gains in the ICICI bank could be attributed to a hike in deposit and lending rates effected by it and which is likely to push the earnings higher as there seems to be no let up on the credit off take front currently. The technology stocks also saw run up in their prices as the outsourcing to India is increasing and the hiring spree of these technology major continues.
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