The Hindu Business Line : Infosys, Wipro buck bullish trend

LED by Sun Microsystems, which settled a decade-long feud with Microsoft Corp to resolve legal disputes, the US benchmarks finished last week on a firm note.

The Standard & Poor's 500 Index registered its first weekly gain in a month; the S&P 500 rose three per cent for the week, the Dow Jones Industrial Average climbed 2.5 per cent and the Nasdaq Composite Index gained five per cent.

According to Bloomberg data, the increases for the S&P 500 and Dow average were the biggest since October 3, while the Nasdaq's rise was the largest since May.

For the domestic market, the strong economic data coupled with active FII inflows acted as a trigger. The BSE Sensex surged 4.69 per cent during the week while the S&P CNX Nifty by 5.36 per cent.

Tech stocks, however, suffered following the relentless appreciation of the rupee against the US currency.

Moving on to ADRs, except Infosys and Wipro all other counters finished the week on a firm note. In fact, Internet company Rediff.com touched new high levels of $13.87 during the week.

The company's announcement that it had entered an agreement with Yahoo! India, a unit of Yahoo! Inc., to promote online shopping and content across both portals seemed to have lifted the counter. Rediff.com finished last week at $11.12 compared to the previous week's close of $7.8, a gain of about 42 per cent.

Another counter that witnessed strong performance was VSNL, which closed at $9.25 ($8.68). Reports that the company will carry all overseas calls for BSNL's 42 million subscribers appeared to have induced positive sentiment.

Added to this was the company's announcement of the signing of an agreement with a consortium of 15 other international telecom companies for a new submarine cable system.

ICICI Bank, which received excess demand from investors for its public offer to mop up about Rs 3,500 crore, on the first day itself, also closed firm at $16.44 ($14.15). The offer is open for sale till April 7.

Dr Reddy's Laboratories also closed higher at $24.33 ($23.62) after the company informed that it has started selling a diarrhoea drug called `Redotil'.

Apart from the appreciating rupee, Wipro suffered after the company said that it had been served a notice by the Income-Tax authorities for payment of Rs 261.40 crore as taxes under the Income-Tax Act, 1961 primarily on account of denial of the deduction under Section 10A for the software profit earned out of its STP units located in Bangalore.

The company has decided to file an appeal before the Commissioner (Appeals), the first appellate authority. But the counter fell to $42.64 ($43.06).

On the premium front, the Satyam ADR widened its premium to its underlying equity to 59.28 per cent against last weekend's premium of 48.15 per cent. For other counters, there was not much deviation.