Tech stocks pull Sensex down 172 pts

Outsourcing fears wreak havoc

Technology stock prices fell like nine pins yesterday, pulling the Bombay Stock Exchange Sensex down 2.85 per cent (171.92 points) to 5,855.10.

The Satyam Computer scrip plunged 6.52 per cent to Rs 312.80, Wipro 5.22 per cent to Rs 1,505.95 and Infosys Technologies 4.59 per cent to Rs 5,095.75.

Technology scrips were hammered as the market fretted over the possibility of greater pressure in the US to stop outsourcing jobs to India. The BSE IT sector index was down 4.62 per cent at 1,842.40 points.

While technology was the flavour of the day, selling pressure was seen across the board. The BSE PSU index lost 3.13 per cent, consumer durables index 3.19 per cent and Bankex 2.58 per cent.

"The selling pressure in the market was aggravated by margin calls as banks and brokerage houses sold stocks held as collateral against loans, intensifying the fall," said a dealer at a local brokerage. Margin calls are triggered when stocks fall below a specified level.

Reacting to the fall in the Sensex today, Disinvestment Minister Arun Shourie said the proposed public floats would not suffer on this account.

"The scrips going to the market are strong and the investor will gain like in the case of the Maruti issue," he said.

The State Bank of India scrip tumbled 4.11 per cent to Rs 602.75, Reliance Industries 3.82 per cent to Rs 581.30 and Hindustan Lever 2.96 per cent to Rs 182.05. ACC lost 2.92 per cent at Rs 262.20 and Gujarat Ambuja 4.85 per cent at Rs 303.95. Tata Power shed 4.70 per cent to Rs 374.50 and Reliance Energy 4.15 per cent to Rs 638.15.

The scrip prices of only two of the six state-owned companies on the current disinvestment list closed higher. IPCL gained 1.59 per cent at Rs 194.95 and CMC 1.45 per cent at Rs 573.40.

But ONGC declined 2.07 per cent to close at Rs 753.45, IBP 3.85 per cent at Rs 695.15, Gail 1.67 per cent at Rs 222.95 and Dredging Corporation 0.78 per cent at Rs 514.30.

Among the other state-owned companies, Hindustan Petroleum shed 3.95 per cent at Rs 457.95, Bhel 3.35 per cent at Rs 599.60 and Mahanagar Telephone Nigam Ltd 2.28 per cent at Rs 137.10.

Tata Motors was down 3.42 per cent at Rs 544, Bajaj Auto 3.25 per cent at Rs 952.15 and Hero Honda 2.83 per cent at Rs 490.05.

The weak market sentiment also reflected in the 4:1 ratio of losers to gainers on the BSE. In the specified group, 196 stocks, including 28 of the 30 Sensex counters, registered sharp to moderate losses, while 14 closed with gains.

The turnover on the BSE jumped to Rs 3,121.54 crore from Rs 2,573.93 crore yesterday. On the National Stock Exchange (NSE), the turnover was Rs 6,305.28 crore (Rs 5,507.92 crore).

In the NSE's derivatives segment, 3,49,043 (252,617) contracts worth Rs 17,053.45 crore (Rs 12,768.78 crore) were traded.