Tech Stocks Dumped In Derivatives Market Also

Mad rush to sell technology shares between April 10 and April 16

Frontline software stocks are being treated almost like untouchables, with investors dumping them not only in the cash market, but also in the derivatives market.

Trading data on the Bombay Stock Exchange (BSE) and the National Stock Exchange (NSE) show there was a mad rush to sell shares of Infosys Technologies, Satyam Computer, Digital Global, Wipro, and several other software stocks between April 10 and April 16.

Infosys has been at the epicentre of the technology meltdown ever since it issued a low profit guidance for 2003-04. The delivery volume of Infosys on the BSE and the NSE shot up from 800,000 shares, or 11.12 per cent of the total traded volume, prior to April 9, to around 6.5 million shares, or 30 per cent of the traded volume, after the company declared its results.

The weekly trading volume of the Infosys scrip also increased substantially from around 8.7 per cent of its equity capital to around 20 per cent.

Wipro also witnessed a surge in delivery-based trading volumes from around 50,000 shares to around 300,000 shares after Infosys declared its results on April 10. Similarly, delivery volumes in Satyam

Computer increased from 1-1.5 million shares to 4-5 million shares during the five trading sessions after Infosys