Financial Daily from THE HINDU group of publications
Monday, Nov 11, 2002
Columns - ADR Watch
Infosys registers new 52-week high
K.S. Badri Narayanan
THE US markets did not react much to the US Federal Reserve's rate cut during last week. For the first time in five weeks, the broader S&P 500 and the tech-focussed Nasdaq Composite index fell while the Dow Jones Industrial Average just managed to end firm. The S&P-500 dropped 0.7 per cent last week to close at 894.74 over the previous week close of 900.96 and Nasdaq 0.1 per cent to 1359.28 (1360.70). The Dow gained 0.2 per cent.
All three benchmarks are headed toward their third year of declines for the first time since World War II.
Sentiment also took a beating following the UN Security Council's unanimous vote to adopt a US resolution demanding unrestricted arms inspections in Iraq.
The domestic markets were also stuck in a narrow range. Concerns over the disinvestments process had affected the sentiment. After confining to the narrow range of 2993.61-2950.71, the Bombay Stock Exchange (BSE) Sensitive index closed the week at 2956.84 (2950.55). The National Stock Exchange's S&P CNX Nifty at 956.95 (951.45).
Moving to ADRs, infotech majors Infosys Technologies, Satyam Computer and Wipro closed the week on a firm note. Infosys counter registered its new 52-week high at $79.22. Reports that Infosys and Wipro were shortlisted by Lehman Brothers for outsourcing contracts seemed to have lifted the sentiment for all the three big players. In fact, Wipro announced that it bagged order.
However, profit warning from global IT major, Cisco Systems triggered a selling pressure on these counters. Infosys closed the week at $75.45 (70.48) and Wipro at $29.25 ($28.24) while Satyam at $11.22 ($11.02).
VSNL and Dr. Reddy's Laboratories hit their fresh 52-week low levels during the week. Dr. Reddy's however, recovered to close the week flat at $14.44 (14.45) after hitting the yearly low of $13.31.
On the other hand, VSNL closed around at its yearly low levels; the counter finished the week at $3.57 and its yearly low is $3.53 at $3.57.
Bank counters HDFC Bank and ICICI Bank also closed the week on negative note at $13.33 ($13.35) and $5.53 ($6) respectively.
As far as premiums are concerned, there were not much deviations in the premium of the ADR to the underlying stock. Infosys ADR continued to rule above the 80-per cent premium mark at 82.13 per cent as against the previous weekend premium of 85.29 per cent.
Internet counters, Satyam Infoway and Rediff.com, closed the week on positive note with Sify closing at $1.295 ($1.145) and .34 ($.27) respectively.
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