Friday's Asia ADR Recap: Sohu.com

Goldman Sachs downgraded Cognizant Technology (CTSH Quote) a U.S.-based information technology company with large exposure to the Indian market, to neutral from buy and removed the stock from its Americas buy list citing valuation. Goldman analyst Julio Quinteros Jr. said the stock has reached a fair price and is unlikely to trade higher in the near term. Despite the downgrade, Quinteros kept his price target of $38 for the stock. He also said he sees more upside in Hyderabad-based Saytam Computer (SAY Quote) for investors who want to play the Indian IT outsourcing sector. Shares of Saytam, however, dove 5.8% to $25.20, and shares of Cognizant dipped 4.7% to $34.97.

Some big decliners among Indian ADRs Friday were Wipro Limited (WIT Quote), which lost 7.4% to $12.48; ICICI Bank (IBN Quote), which fell 5.7% to $33.54; Tata Communications (TCL Quote), which plunged 5.6% to $18.41; and Sterlite Industries (SLT Quote), which finished 4.6% lower to $17.74.

Be sure to check out the Far East Portfolio at Stockpickr.com every night to find out which stocks in India and China are making big moves and announcing major news.

China Recap

Stocks in mainland China surged higher Friday, led by oil refiners and power companies after the government hiked the retail price of gasoline by 17%, diesel 18%, jet fuel by a whopping 25% and electricity tariffs by 4.7%. China also implemented a six-month freeze on the price of coal sold to electric companies. Market players in the region were surprised to see the energy price hikes announced before the start of the Beijing Olympics in August.

In a research note published Friday, Credit Suisse regional chief economist Dong Tao wrote, "We believe the hike will be negative to oil demand and the timing and scale of the price adjustments were surprising."

Shares in Hong Kong did not join the rally in mainland China after government inflation figures came in higher than expected, due to rising food and rent prices. Consumer prices spiked to 5.7% in May, vs. 5.4% in April, according to the Census and Statistics Department.

"The bulk of the cost increases come from food, although rents, salaries and utility bills have also risen,'' said Linda Kwan, marketing director at Igor's in Hong Kong. "Some of these unfortunately got passed to our customers -- there is no way we can absorb everything."

The Shanghai Composite Index closed up 82.86 points, or 3%, at 2,831.74, and Hong Kong's Hang Seng Index fell 52.01 points, or 0.2%, to 22,745.60. Here's a look at how some China-based American depositary shares traded in the U.S. on Friday.

Shares of Sohu.com (SOHU Quote), a Chinese Internet media company, plunged 11.3% after the company said it expects online advertising revenue to grow by 40% to 45% for fiscal 2008 but warned that growth for 2009 will slow to 20% to 30%. American depositary shares of Sohu.com, which trade on the Nasdaq, lost $13.67 to $71.91.

Elsewhere in the Chinese Internet complex, shares of SINA (SINA Quote) dove 8.7% to $44.81; NetEase.com (NTES Quote) fell 4.8% to $21.94; and Baidu.com (BIDU Quote) slipped 3.5% to $322.89.

According to First Financial Daily, Chinese life insurance company China Life Insurance (LFC Quote) is in discussions to acquire a stake in the Bank of Ningxia, which is the only commercial bank located in northwestern China's Ningxia province. The bank is planning to issue 500 million new shares to domestic investors, and China Life is reportedly interested in acquiring 100 million of those new shares. Shares of China Life traded down 3.7% to $53.19.

Chinese mobile service provider China Mobile (CHL Quote) announced it added 7.49 million new subscribers in May, vs. 7.41 million subscribers in April. The new subscriber additions in May bring the firm's total subscriber base to 407.04 million. Shares of China Mobile slipped to 3% to $67.01.

Hurray! Holding (HRAY Quote), a Chinese company that is engaged in artist development, music production and offline distribution of music, announced its president, chief operating officer and acting chief financial officer Sean Wang is resigning from his positions, effective June 20. The company named Xiaoquing Guo as acting CFO effective today. Guo currently holds the position of vice president and financial controller at the company. Shares of Hurray! finished unchanged $3.05.

Some big movers to the downside among Chinese ADRs and China-based stocks Friday were Spreadtrum Communications (SPRD Quote), which dropped 10.4% to $5.32; Huaneng Power International (HNP Quote), which plunged 10.3% to $32.13; China Petroleum & Chemical (SNP Quote), which lost 9.8% to $101.39; and China Southern Airline (ZNH Quote), which ended down 8.2% to $21.50.

Be sure to check out the Far East Portfolio at Stockpickr.com every night to find out which stocks in India and China are making big moves and announcing major news.