Despite rupee depreciating to a 2-year low against the dollar, stocks of Indian IT majors tumbled on Friday following the collapse of Lehman Brothers and mainly on foreign brokerage UBS saying a sharp appreciation in the dollar against the British pound and euro would hit IT firms' revenue in dollar terms by 1-2 per cent.
Lehman is trying to raise capital and shed devalued real estate assets after $8.2 billion in write-downs and credit losses in the past year. The 4th largest investment bank in the US posted a loss of $3.9 billion for the June quarter.
The US Treasury and Federal Reserve are working in co-ordination with Lehman on a sale, after with Korea Development Bank failed. A deal may be announced by Monday.
Meanwhile, in its latest report to clients, UBS said the dollar has risen 5.5 per cent, 13.8 per cent and 13 per cent respectively against the Indian rupee, pound and euro in the current quarter (ending September).
"Indian IT majors have a large exposure to the US BFSI sector. This sector is already in worsening path, more so after the Lehman collapse," said V Theegala, an analyst with a local brokerage.
"Lehman is not able to find a buyer yet. Federal Reserve and US Treasury are negotiating to find a buyer. The intervention by the US government itself indicates a weakness," Theegala added.
American depository receipts of IT majors slipped in US markets on Thursday. Infosys Technologies ADR fell 5.13 per cent, Wipro lost 4.65 per cent and Satyam Computer shed 2.65 per cent.
At 2:48 pm on NSE, Infosys shares plunged 5.59 per cent, Hexaware slumped 5.05 per cent, Patni Computer fell 4.17 per cent and I-Flex dropped 3.39 per cent.
via ET
Lehman is trying to raise capital and shed devalued real estate assets after $8.2 billion in write-downs and credit losses in the past year. The 4th largest investment bank in the US posted a loss of $3.9 billion for the June quarter.
The US Treasury and Federal Reserve are working in co-ordination with Lehman on a sale, after with Korea Development Bank failed. A deal may be announced by Monday.
Meanwhile, in its latest report to clients, UBS said the dollar has risen 5.5 per cent, 13.8 per cent and 13 per cent respectively against the Indian rupee, pound and euro in the current quarter (ending September).
"Indian IT majors have a large exposure to the US BFSI sector. This sector is already in worsening path, more so after the Lehman collapse," said V Theegala, an analyst with a local brokerage.
"Lehman is not able to find a buyer yet. Federal Reserve and US Treasury are negotiating to find a buyer. The intervention by the US government itself indicates a weakness," Theegala added.
American depository receipts of IT majors slipped in US markets on Thursday. Infosys Technologies ADR fell 5.13 per cent, Wipro lost 4.65 per cent and Satyam Computer shed 2.65 per cent.
At 2:48 pm on NSE, Infosys shares plunged 5.59 per cent, Hexaware slumped 5.05 per cent, Patni Computer fell 4.17 per cent and I-Flex dropped 3.39 per cent.
via ET
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