Sunday, 2 August 2009

Share indices July 09

(By Richard Holway 4.00pm Sunday 2nd August 09) You cannot have missed all the euphoria about the performance of the FTSE100 this month. A near-term record 11 consecutive days of rises meant that the FTSE100 ended July 8.5% higher than it started – indeed some 31% higher than its March 09 low. Just for once, the FTSE100 led all the tech indices – on both sides of the pond. The FTSE SCS Index ‘only’ managed a 4.2% rise but that still puts it a massive 40% higher 2009 YTD. I will say, yet again, that over any medium term, the FTSE SCS and FTSE100 perform in line – so you can draw your own conclusions about what might happen next.
The FTSE SCS could have been a whole lot higher had it not been for a massive 18% slump in Autonomy’s shares (Autonomy is the highest weighted constituent of the FTSE SCS Index) I can’t really see what Autonomy did to deserve this! Looks more like investors realising that they might have ‘over egged’ things before. Anite also declined 24% on disappointing results and outlook – See our Anite betting on 4G. Elsewhere Logica put on an impressive 28% ahead of this week’s interims and as a reaction to good results from its European peers Atos and Capgemini. Outside the FTSE SCS, Morse was the star – more than doubling this month to 31p as bid talk intensifies. See our post Mixed news at Morse.

The FTSE Telcom Index put on 7% mainly on the back of a 25% increase (recovery) in BT’s stock as investors took a shine to the Q1 results. See our post – Market reacts positively to BT’s Q1 results.)

This general euphoria extended to most of the other stocks we track. HP was up 12% and Unisys continued its storming performance with an 18% rise in July. On the Continent, Atos (+32% - see our post UK star shines brightest for Atos), Steria (+30%), Capgemini (+24% See our post Capgemini talking about important things) and Sopra (+14%) all registered double-digit gains. Even SAP was up 15% - see our SAP update. Surprising as we were hardly inspired by their “Margins higher, revenues lower” guidance. The Indian stocks did even better with Satyam up 62%, WNS (+42%), Patni (+39% See our post Patni getting back on track), TCS (+35%), HCL (+30%), Wipro (+23% See our post Wipro Q1 2010 update), Infosys (+17% See our post Infosys barely less bearish on outlook),

Perhaps you can now understand our nervousness?

Finally just to remind you that we have just published our quarterly IndustryViews Quoted Sector note on the publicly quoted SITS stocks. Great read (of course) but only available as part of our subscriber package. Contact Puni on to join our ever expanding club.

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