IT stocks lead 523-point fall

A steep decline in the information technology (IT) stocks due to contraction in the US services sector yet again dragged Indian stock prices as investors judged recession in the world's biggest economy will trigger big cuts in IT spend, affecting revenues of companies such as Infosys, TCS and Wipro.

Top IT stocks, which had run-up by over 20 per cent during the past two weeks, shed 5 to 6 per cent on Wednesday thereby becoming top losers among the 30 Sensex shares. 

LOSERS ALL
Company	Price in Rs	%  fall
Satyam Comp	408.65	6.74
Wipro	425.00	6.45
Infosys Tech	1510.60	6.25
TCS	900.55	5.15

While the Bombay Stock Exchange (BSE) Sensex declined by 2.81 per cent (523 points) to close at 18,139, the broader S&P CNX Nifty of the National Stock Exchange (NSE) shed 2.94 per cent (161 points) to settle at 5,322.

Satyam Computers was down 6.74 per cent at Rs 408.65, Wipro Ltd fell 6.45 per cent at Rs 425, Infosys Technologies declined 6.25 per cent at Rs 1,510.60 and TCS Ltd dipped 5.15 per cent at Rs 900.55.

The IT index on BSE was down 5.59 per cent. Stock brokers indicated that investors were not too optimistic on the markets in the short-run and were not in a hurry to buy.

"Markets are going down on ridiculously low volumes. Most of the investors are looking at the global markets to stabilise," said Kashmira Mehta, institutional dealer at C D Equisearch Securities.

US stocks suffered their biggest drop in nearly a year on Tuesday after data showed the worst monthly contraction in the services sector since the last recession and Standard & Poor's (S&P's) warned it could cut bank credit ratings.