Post- Market Commentary, Monday, July 14, 2008

Ranbaxy, Infosys tumble
Stocks ended volatile session with losses for the second straight day on sustained selling in IT and select blue-chip stocks. Ranbaxy Labs suffered over 10% on high volumes. Fresh selling at day’s high in mid-afternoon trade derailed a sustained recovery from lower level witnessed earlier in the day. Volatility was high in the later half of day. The market breadth was weak.
IT pivotals tumbled hit by sharp fall in American depository receipts (ADRs) on the New York Stock Exchange (NYSE) on Friday, 11 July 2008.
European stocks surged, boosted by a US plan to rescue embattled mortgage finance companies Fannie Mae and Freddie Mac and by a fresh surge of acquisition activity. Key benchmark indices in UK, France and Germany rose by 1.22% and 1.77%.

BSE Sensex was down 139.34 points or 1.03% at 13,330.51. The Sensex gained 89.51 points at day's high of 13,559.36 hit in mid-afternoon trade. At the day’s low of 13,269.62, the Sensex slipped 200.23 points in late trade.

Nifty fell 9.03 points or 0.23% to 4039.70.

As per provisional data, foreign funds sold shares worth a net Rs 436.52 crore while domestic funds bought shares worth a net Rs 63.25 crore today, 14 July 2008.

India’s largest pharma company in terms of sales Ranbaxy Laboratories tumbled 10.83% to Rs 473.90 on 28.61 lakh shares. It was the top loser from Sensex pack. The stock was hammered on reports the US government has levelled serious allegations against the company. The US department of justice (DoJ) has said that there was evidence to suggest that Ranbaxy used active pharmaceutical ingredients (API) from unapproved sources, blended unapproved API with approved API, and used less-than-approved API at its Paonta Sahib (Himachal Pradesh) plant in its drugs, resulting in the sale of subpotent, super- potent or adulterated medicines in the US market.
In a statement, Ranbaxy strongly denied the allegations raised by the US Department of Justice (DOJ). The company also stated that its business in the US continues as normal. Ranbaxy also said the company's deal with Japanese drug maker Daiichi Sankyo is binding and final and remains on track.