Tech shares pull down Sensex

Tech shares pull down Sensex

New Delhi: Fears that the US economy is heading into another recession have led to selling in the information technology stocks and pulled down the benchmark index.

After a weak opening, Indian stocks traded with negative momentum for rest of the day as investors cautiously gauged the impact of weakening US and EU economies on domestic companies. While concerns about the global economy led to selling in software stocks, the negative momentum in global equities dented sentiment in the domestic market.

Sensex: 16,141 –1.99%

Nifty: 4,845 –1.99%

Tata Motors, Infosys, Larsen & Toubro and BHEL led the losses in the Nifty shares. Morgan Stanley downgraded the Larsen & Toubro stock to equal-weight citing project delays and weakness in capital expenditure.

Tata Motors: 710 –5.6%

Infosys: 2,225 –5.5%

Larsen & Toubro: 1,546 –4.9%

BHEL: 1,680 –4.7%

Meanwhile, JP Associates, DLF, Hero MotoCorp and Hindalco registered gains of over 2% each. DLF rose 2.9% on reports that the company is selling a plot in Gurgaon to ease its debt burden. Read more...-

JP Associates: 60 +3.0%

DLF: 187 +2.9%

Hero MotoCorp: 1,996 +2.2%

Hindalco: 140 +2.0%

At the sectoral level, information technology, banking and capital stocks led the losses on the BSE. Except real estate, all BSE sectoral indices closed the day with losses.

BSE IT: 4,738 –4.4%

BSE Capital Goods: 11,535 –4.2%

BSE Bankex: 10,763 –1.9%

Indian software companies derive majority of their revenues from the US and European markets. Increasing uncertainty in these economies is expected to hit project pipelines of domestic software companies.

Patni Computers: 255 –4.1%

Tech Mahindra: 635 –3.9%

Oracle Financial Services: 1,760 –3.9%

TCS: 929 –3.4%

Fears that the slowing global economy will impact capital expenditure cycle in the domestic economy has led to selling capital goods stocks. Apart from L&T and BHEL, Areva T&D, Pipavav Shipyard, SKF India and Suzlon Energy are other big losers.

Suzlon Energy: 37 –5.4%

Pipavav Shipyard: 62 –4.9%

SKF India: 621 –4.5%

Areva T&D: 210 –4.3%

Overall, 70.35% of the shares traded on the BSE closed the day with losses.