Sebi investigates share movements of 6 firms
Mumbai--The Securities and Exchange Board of India (Sebi) is reported to have launched a probe into the share price activities of six companies in an effort to assess if these companies had links with stock broker Ketan Parekh whether they benefited from these connections.

The companies include S Kumars Synthetics, Hughes Escorts Communications, HCL Infotech, Tips International, Mukta Arts and Balaji Telefilms. It is learnt that Sebi will soon be sending them letters seeking a broad spectrum of information on their share prices.

Sebi also informed the Joint Parliamentary Committee (JPC) that it had launched the investigation after it received complaints of price rigging in these scrips and that details of price movements in these stocks were being obtained.

Meanwhile, Sebi will soon release its second investigation report on the market crash. Sebi sources say that though the second edition, is not as voluminous as the first, it details the various transactions related to parties named in the first report.

It has also devoted more pages to the working of overseas corporate bodies, mainly sub-accounts created by local brokers, which were allegedly used to route funds into the stock market to boost trading volumes. The report has also given some interesting insights into how exactly the market crash occurred and the price manipulation which lead to the eventual crash in prices in the first week of March, 2001.
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The rise and fall of Cyberspace
New Delhi—The rise of Cyberspace started in the 1990s and CMIE data reveals that nationalised banks were the first to have invested in Cyberspace before UTI, GIC or LIC.

CMIE data says that as on December 27, 1999 nationalised banks held 9.61 lakh shares, translating into a 16.7 per cent stake, in Cyberspace.

This was when no financial institutions, state finance corporation, insurance company and mutual fund including UTI held even a single share in Cyberspace.

But, after that in a few months, not only UTI but two public sector mutual funds— LIC Mutual Fund and GIC Mutual Fund— as well as Reliance Capital picked up large chunks of the company’s share capital through a preferential allotment.

It has also seems that LIC Mutual Fund and Reliance Mutual Fund actually booked profits on investments in Cyberspace.

At present Cyberspace is in trouble with companies like IBM and Lotus planning to terminate their relationship with it.

An IBM India spokesperson said that it had an agreement with Cyberspace for the distribution of Tivoli range of products in India. Now, with the company’s operations becoming defunct, IBM is in the process of reviewing the agreement with Cyberspace with the aim of terminating it.

Similarly Lotus, for which Cyberspace was managing the national support center, is also working towards terminating its service agreement with Cyberspace.

Cyberspace was established in 1984 and employed about 130 software professional in the beginning of the year 2000.

The company went public in 1994 when it had raised about Rs 3 crore. Today, the company scrip closed at Rs. 1.50 at the Bombay Stock Exchange.

The company had clocked revenues to the tune of Rs 38.6 crore during 1999-2000 with exports contributing about Rs 10 crore. The company had projected revenue of Rs 120 crore for the year 2000-01 with exports contributing about 50 per cent of it.

The company had also acquired UII Corporation of the US in a $6.23 million cash and stock deal. As per the deal with the $9.5 million software services and consultancy firm, Cyberspace was to offer 30 per cent of the consideration in cash and the remaining in stock.

KPMG, which carried out the complete due diligence on behalf of Cyberspace, conducted the deal.
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GIC-Cyberspace links to be probed by CBI
New Delhi-The CBI has now launched a probe into the circumstances in which GIC Mutual Fund purchased 35,000 Cyberspace Infosys shares of Rs 10 each, which at present is split into shares of Rs 2 each.
It is learnt that that CBI has called for relevant files from the mutual fund. The inquiry aims to find out whether extraneous considerations influenced the GIC MF's decision to pick up equity in Cyberspace.
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Rise of demat stocks on NSE
Mumbai-Of the total turnover on the National Stock Exchange in June trading in demat stocks accounted for 99.63 per cent.
Of this, ten stocks accounted for 66.24 per cent of the total turnover, while three stocks, which garnered more than 10 per cent share of the turnover each, and cumulatively accounted for a 32 per cent share in the total turnover.
At the first place stood Digital Equipment at 11.97 per cent of the total, Infosys Technologies stood second at 10. 87 per cent, and Satyam Computer Services at the third slot at 10.97 per cent.
The share of Wipro stood at 8.65 per cent, Global Tele-Systems at 6.03 per cent, Reliance Industries at 5.05 per cent, SSI at 4.09 per cent, Himachal Futuristic Communications Ltd (HFCL) at 3.83 per cent, Zee Telefilms at 3.14 per cent and Pentamedia Graphics at 2.41 per cent.
Satyam Computer Services registered the highest turnover on a volume basis at 22.71 crore shares, while value-wise Digital Equipment topped at Rs 51.22 crore.
According to NSE data, the top 10 stocks cumulatively accounted for Rs 283.41 crore of the total turnover of Rs 427.83 crore. NSE's average daily turnover in June stood at around Rs 2,037 crore, down from the previous month's Rs 2,197 crore. On an average, over 6.34 lakh trades were transacted daily in June with an average trade size of Rs 32,151.
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US stocks rally
New York-Wall Street rebounded yesterday on the back of good gains clocked by Lucent, AT&T and Texas Instruments.
The mood turned bouyant with companies meeting their numbers targets and maintaining a positive outlook for the second half of the year.
While the Dow advanced 165 points to 10,406, a gain of 1.6 per cent, recovering nearly half the 335 points it had lost earlier this week. Nasdaq gained 25 points to 1,984.
Analysts however were not convinced that business and profits were going to turn around.
The Standard & Poor's 500 index rose 18.85, or 1.6 per cent, to 1,190.50, while the Nasdaq composite index gained 25.18, or 1.3 per cent, to 1,984.42.
While all three indexes were above their lows for the year, they remained well below the point they started in 2001. The Dow was off more than 3 per cent, the S-and-P down nearly 10 per cent and the Nasdaq had fallen close to 20 per cent.
Even the prospect of an August interest rate cut - the seventh of the year - has failed to excite Wall Street.
Investors however rewarded companies that delivered good earnings news.
SBC Communications rose $2.58 to $43.38, a 6 per cent gain, after beating Wall Street estimates.
Investors also bid Texaco higher, up $3.13 at $67.65, a 4.9 per cent increase, after the company beat earnings expectations and said its merger with Chevron should be completed this fall.
Oil stocks were also helped by an Opec decision to cut crude oil output by at least 1 million barrels a day.
Technology stocks also advanced late in the day. Oracle rose 6 per cent, up $1.08 at $19.29.
Indian floats, however, ended on a mixed note. While Infy gained 1.54 percent ($0.85) to $56.10, Satyam declined 4.03 percent ($0.31) to $7.39.
Wipro was up 0.29 percent ($0.08) to $28.07. VSNL added 1.41 percent ($0.16) to $11.50.
ICICI tanked 13.5 percent ($1.20) to $7.68. HDFC Bank declined 4.19 percent ($0.64) to 14.65. DRL and ICICI Bank also closed in the red.
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