Equity Alert: Tech shares up on short covering; upside limited
MUMBAI--10:45AM--Shares of front line information technology
companies
were up on short covering, after the sector was battered in the last
few
sessions as credit crisis in U.S. financial market worsened further,
dealers
said. CNX IT Index has shed nearly 12% in the last five sessions.
Most IT shares derive major part of their export revenues from the
U.S.
banking and financial sector.
"The demand environment has not changed for these companies. With
Lehman
Brothers filing for bankruptcy and Merrill Lynch going for a sale, the
situation is getting worsened," an analyst at a large domestic
brokerage
house said.
Jul-Sep results and companies' comments for the second half of the
current financial year will set the direction for the sector, he said.
Infosys rose nearly 4% to 1,623 rupees, Satyam Computer Services
was up
2% at 362 rupees.
Wipro advanced nearly 1% to 395 rupees and CNX IT Index rose 1.2%.
Tata Consultancy Services was up marginally at 749 rupees, while
HCL
Technologies rose 0.5% to 223 rupees.
Dealers said gains may not sustain as some selling pressure is
expected
at higher levels.
Intraday resistances for Infosys and Satyam are seen at 1,650
rupees and
371 rupees, respectively, Gurudutta Dhanokar, technical analyst at
Almondz
Global Securities said.
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