The benchmark indices have been swept by the latest wave of uncertainty to grip the global bourses, negating the strength of last week and the apparent stability witnessed on Monday. The pounding metted to the IT counters in wake of the not-so-enthusing results from the TCS and HCL Tech counters has only exacerbated matters. The Sensex has broken the psychological 17,000 level s and is currently at 16737, weaker by 287 points and the Nifty is at 5031, down 86 points. The midcap index is at 6114, lower by 74 points and the smallcap index is at 6847, down 75 points.
Wall Street had suffered its worst loss in two weeks on Monday after comments from Germany's finance minister caused investors to fear Europe's solution to its debt crisis may not come fast enough. The Dow ended down 246 points and Nasdaq shed 52 points. And Moody's warned that it may give a negative outlook on France's Aaa credit rating in the next three months if the costs for helping to bail out banks and other euro zone members stretch its budget too much.
The Asian markets understandably went into a tailspin; Hang Seng shed more than 4%, while Shanghai, Nikkei, Straits Times and Taiwan lost 1-2% each. The European markets dampened sentiment further; the CAC, FTSE and DAX were down about a percent each in early trades.
On the results front, TCS failed to meet market expectations in reporting a 6.1% jump in consolidated net profit to Rs 2,301 crore for the second quarter ended September 30, 2011 as against Rs 2,169.21 crore for the July-September quarter last year.
HCL Technologies was also unsuccessful in meeting estimates as it reported 2.7% quarter-on-quarter drop in its consolidated net income to Rs 496.70 crore in first quarter ended September 2011, as per US accounting standards. Consolidated sales climbed 8.2% to Rs 4,651 crore on a sequential basis. Consolidated sales, however, climbed 8.2% to Rs 4,651 crore on a sequential basis.
However, Patni Computer Systems was able to script a turnaround, reporting a consolidated net profit of Rs 90.27 crore in the third quarter ended September 2011, against a net loss of Rs 51.52 crore at the end of the first quarter ended June, due to lower staff cost. The total income grew by 2% at Rs 892 crore on a quarter-on-quarter basis.
More From This Section
TCS received the brunt of pounding among the IT stocks, diving by a whopping 8% at Rs 1029. Among the other IT biggies, Wipro weakened by 2.8% at Rs 346 and Infosys shed 1.6% at Rs 819. In the broader IT univers, HCL Tech crumbled by 7.9% at Rs 404 and Mphasis slumped by 5.3% at Rs 322.
Metals also lost their luster, with Sterlite weakening by 3.8% at Rs 116l, Hindalco losing 3.3% at Rs 125 and Tata Steel losinf 2.4% at Rs 428.
And index heavyweight Reliance Industries (RIL) extended Monday's losses triggered by weak Q2 operating performance to shed another 1.7% at Rs 818.
Coal India bucked the overall trend to gain 2.4% at Rs 329 and Hero Motocorp added 0.4% at Rs 2001.
The overall market breadth was extremely negative as 1,821 stocks declined while 807 stocks advanced.