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Published On: Tue, Oct 22nd, 2019

Sensex, Nifty bleed on Infosys share price crash

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103756-sensex-crashes-ptiMUMBAI : On account of heavy selloff in the Infosys shares in the intraday trade, the Indian indices went down after showcasing gains in the early morning trade session. Infosys shares nosedived nearly 17 per cent on Tuesday in their worst single-day drop in over six years, wiping out investors’ wealth worth nearly Rs. 53,000 crore.

The BSE Sensex went down 334 points to 38,963 levels while the 50-stock Nifty crashed 73 points after closing at 11,588 levels post-Closing Bell trade session. However, the Bank Nifty index scaled 290 points and closed at 29,411 levels.
Elaborating upon the Indian stock market Prakash Pandey, MD & CEO at Plutus Advisors said, “The 50-stock Nifty has rallied 400 points in the last six trading sessions and the index has tested the upper resistance of its range.
Nifty will face the hurdle/resistance in the zone of 11705 to 11810 and profit booking on Nifty is advisable in this zone.” He said that the Nifty-50 index would trade in the range 11530-11810 throughout this week.
On why the Indian share market crashed in the intraday trade Prakash Paney of Plutus Advisors said that this crash was due to the Infosys share price nosedive. Pandey went on to add that had the Infosys shares had not gone down the 50-stock Nifty would have ended 30 points higher as other stocks at Nifty performed in such a way that Nifty could have gained 100 points from its previous close.

Infosys share price crashed around 16.73 per cent in the intraday trade. Apart from Infosys, shares of L&T Technology Services, Orient Cement, General Insurance Corporation,

Zensar Technologies, Cyient and Dewan Housing Finance Corporation Limited or DHFL were among the major losers in the intraday trade while shares of Reliance Power, Reliance Infrastructure, Vakrangee, Piramal Enterprises, Nippon LifeAM and SBI Life Insurance were among the major gainers after the closing bell trade session.
IT and Tech stocks led the bloodbath at Dalal Street as the BSE IT and Tech index crashed near 7 per cent and 6.35 per cent respectively. IT major Cyient share price nosedived 5.53 per cent, shares of HCL Technologies went down 2.91 per cent, Hexaware Technologies stocks dipped 2.02 per cent, L&T Technology Services dipped towards south to the tune of 10.10 per cent.

Among major Asian markets; the Japanese Nikkei went up 0.25 per cent, South Korean Kospi soared 1.16 per cent, Hang Seng added 0.23 per cent while the Shanghai markets closed 0.48 per cent higher from its previous day’s closing.
While the whistleblowers accused CEO Salil Parekh of leading an effort to shore up profits through irregular accounting, Infosys said one of the complaints dealt largely with allegations relating to his international travel to the US. The allegations come just two years after the IT major endured a shake-up that saw its top boss Vishal Sikka leave the company.
In a statement released on Tuesday morning, Infosys chairman Nandan Nilekani said the two anonymous complaints have been placed before the company’s Audit Committee on October 10, 2019 and the non-executive members of the board on October 11, 2019. “These Complaints are being dealt with in an objective manner,” he said.
One of the complaints “largely deals with allegations relating to the CEO’s international travel to the US and Mumbai”, the Infosys chairman added.  He also said that the CEO and CFO have been recused from this matter to ensure independence in these investigations.
The audit committee has retained law firm Shardul Amarchand Mangaldas to conduct an independent investigation, and the company’s board will take appropriate steps based on the outcome of the investigation, Mr Nilekani said.
A series of whistleblower complaints over the past two years have wrought havoc at Infosys – Asia’s second-most valuable IT services firm – triggering the exit of Vishal Sikka as CEO after a confrontation with co-founder Narayana Murthy.
Until Monday, Infosys shares in India had gained 16.35 per cent so far this year.(With Agency Inputs ).

 

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