Business Daily from THE HINDU group of publications
Monday, Sep 10, 2007
ePaper
Business Daily from THE HINDU group of publications Monday, Sep 10, 2007 ePaper |
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Markets
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Stock Markets Columns - ADR Watch
The US stocks continued their decline for the second straight week on worried job data – US Labour Department data on Friday showed lost jobs for the first time since 2003. The S&P’s 500 Index fell 1.4 per cent, while the Dow Jones Industrial Average tumbled 1.8 per cent; the tech-heavy Nasdaq retreated 1.2 per cent. The scenario was, however, better on the domestic front as the indices surged on the back of strong economy data and low inflation rate. The BSE Sensex climbed 1.8 per cent, while the NSE S&P CNX Nifty moved up by 1.02 per cent. The divergent show by the bourses was well captured by the Indian ADRs. While the most of the underlying equities gained, values of majority of ADRs tumbled. Of the listed 13 ADRs, four underlying equities – Patni Computers, Sterlite Industires , Tata Motors and Wipro – saw value erosion. On the other hand, only three ADRs – Dr Reddy’s, MTNL and Infosys (marginally) ended in positive territory. As a result, premium of all ADRs dipped, except for Patni Computers. The biggest loser among the ADRs was Patni Computers (10.8 per cent), followed by Satyam Computer (4.4 per cent) and Sterlite Industries (3.5 per cent). Dr Reddy’s and MTNL gained 2.6 per cent and 2.16 per cent respectively. HDFC Bank and ICICI Bank dipped 2.28 per cent and 1.19 per cent respectively, whereas their underlying equities on the BSE surged 2.07 per cent and 3.8 per cent respectively. Rediff.com and Sify also declined by 2.7 per cent and 0.17 per cent respectively. It was a divergent show by IT majors; while Infosys finished a tad better at $47.72 ($47.71), Wipro slipped 3.48 per cent, Satyam 4.43 per cent and Patni Computers 10.8 per ce nt. On the premium front, Wipro ADR commands higher premium of 20 per cent, while the ADRs of ICICI Bank and VSNL rule at a discount of 2.79 per cent.
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