Indian stocks traded lower Tuesday as investors in the Far East reacted to weak global market cues and took the opportunity to sell shares of heavyweights. Dealers in the region said investors are taking a pause and waiting for bullish news as Indian and U.S. companies launch into earnings season.
The Bombay Stock Exchange Sensitive Index fell 169.46 points, or 1.1%, to 15,587.62.
"India is getting in sync with global markets. We have not seen the end of the unwinding in global financial markets. India has rallied to some extent recently due to short covering, but moderation of GDP growth, currency, and inflation risks remain a concern," said Stuart Smythe, head of equities for Macquarie in India.
Shares of Indian global communications company
Tata Communications
(TCL)
fell sharply by 7% after the company announced the district court of The Hague, Netherlands has upheld a decision that Tata must allow Reliance Globalcom access to FLAG Europe Asia Cable (FEA) landing station in Mumbai, which is controlled by Tata. American depositary shares of Tata finished down $1.97, at $25.48.
In the Indian technology space,
Patni Computer Systems
(PTI) - Get Report
announced the appointment of three new members to its senior European management team, according to a company press release. Patni's goal with the new appointments will be to drive an aggressive growth strategy across Europe. Peer Gribbohm, senior vice-president, strategic market development, will be in charge of business across Europe. Derek Kemp, senior vice-president, will lead up the company's efforts to push growth in the communications, media and entertainment sectors and Jeremy Mackinlay, marketing director, will be charge of building up Patni's brand in Europe. Shares of Patni closed essentially flat at $12.42.
Elsewhere in the Indian technology complex,
Satyam Computer
(SAY)
dropped 1.4% to $23.49;
Rediff.com
(REDF)
lost 1.2% to $8.82; and
Infosys Technologies
(INFY) - Get Report
fell by 1% to $36.60.
Be sure to check out the
at Stockpickr.com every night to find out which stocks in India and China are making big moves and announcing major news.
China Recap
Asian markets were weak across the board Tuesday with shares in mainland China experiencing the only gains among the major bourses in the Far East. Dealers in China said the airline and property sectors jumped after the Chinese yuan hit a new record high at 7.0008 to the U.S. dollar. Coupled with the sharp move in the yuan, investors are finding bargains among Chinese stocks with valuations now seen as far more reasonable after the benchmark Shanghai Composite Index slid 34% during the first-quarter.
The Shanghai Composite Index finished up slightly by 12.92 points, or 0.4%, at 3,612.54
"A slide in valuations and double-digit earnings growth both point to a near-term rebound, though China's price control policies could be a major risk," said Aaron Boesky, chief executive for Marco Polo Pure Asset Management.
Stocks in Hong Kong broke a four-day winning streak as investors took weak global cues from a mediocre performance on Wall Street to lock in profits. Analysts said market players are hesitant to build positions in front of the quarterly earnings seasons that are beginning in the U.S.
Hong Kong's Hang Seng Index finished off by 267.07 points, or 1.09%, to 24,311.69.
Chinese search engine giant
Baidu.com
(BIDU) - Get Report
announced it has inked a deal with Chinese
China Netcom Group
(CN) - Get Report
to jointly provide a Baidu-powered Internet search page for China Netcom users. Under the agreement, both firms will develop and power a search page that will redirect users after they attempt to visit an incorrect or nonexistent URL. American depositary shares of Baidu finished down 1.2% at $295.95, and China Netcom closed lower by 2% at $57.42.
The venture capital arm of U.S. semiconductor-chip maker
Intel
(INTC) - Get Report
announced it has formed a new $500 million China fund that will focus on investing in Chinese technology startups like wireless broadband, technology media and telecommunications firms. The fund has already kicked off operations by investing in game network platform maker
Holdfast Online Technology
and television equipment maker
Newauto Video Technology
. Shares of Intel closed lower by 3% at $21.08.
Chinese manufacturer and supplier of branded generic pharmaceuticals
Simcere Pharmaceutical Group
(SCR)
received some good news Tuesday after analyst Jodie Wehner of Global Hunter Securities initiated coverage of the firm with a buy rating and an 18-month price target of $18. Wehner cited a growing generic-drug market in China and an aggressive acquisition strategy for reasons to favor Simcere. Shares of Simcere fell 3% to $11.50.
In the Chinese alternative energy sector,
LDK Solar
(LDK)
announced it intends to offer around $300 million in senior convertible notes to help fund the construction of a polysilicon manufacturing plant, according to a company press release. The news of the offering comes just as the company was informed of the
Securities and Exchange Commission's
decision to not take action against the firm for allegations of overstating its polysilicon inventories. Shares of LDK finished higher by 2% $33.15.
Among Chinese ADRs that dropped noticeably Tuesday were,
E-House Holdings
(EJ)
, which fell 8% to $13.62;
China Finance Online
(JRJC) - Get Report
, which lost 7.7% to $16.10;
AirMedia Group
(AMCN)
, which declined 5.6% to $16.86; and
Uranium Participation
(U)
, which closed lower by 4.4% to $8.85.
Be sure to check out the
at Stockpickr.com every night to find out which stocks in India and China are making big moves and announcing major news.
For more on Asia, check out
Daniel Harrison's coverage
at
TheStreet.com
.
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