Market off lows

The key benchmark indices recovered from the lower levels in early
afternoon trade led by recovery in banking stocks. But a sharp fall
in index heavyweight Reliance Industries (RIL) capped the recovery.
The BSE Sensex was down 192.87 points or 1.91%, recovering close to
140 points from the day's low.

The slide on the domestic bourses was despite firm Asian stocks
which rose as investors welcomed the end to the uncertainty around
the US presidential election. Key benchmark indices in China,
Japan, Singapore, Hong Kong, and South Korea were up by between
2.44% to 5.33%. But the Taiwan Weighted fell 0.29%.

Democrat Barack Obama captured the White House today, defeating
Republican John McCain to make history as the first black to be
elected as the US president.

At 12:25 IST, the BSE 30-share Sensex was down 192.87 points or
1.91% to 10,428.15. The market had surged earlier in the day
boosted by rally in Asian stocks, Barack Obama's election as the
next US president and expectations that a cut in interest rates by
state-run banks that would result in lower borrowing costs for the
corporates. The early rally was also triggered by a sentiment by
the Commerce and Industry Minister Kamal Nath after trading hours
on Tuesday, 3 November 2008, that the government will further ease
foreign investment rules, including those relating to defence
production.

The Sensex surged 314.29 points at day's high of 10,945.41 in early
trade. The index declined 331.01 points at the day's low of
10,300.11 in early afternoon trade.

The S&P CNX Nifty was down 47.80 points or 1.52% to 3,094.30.

The BSE Mid-Cap index was up 0.95% at 3,479.12 and the BSE
Small-Cap index was up 0.39% at 4,053.10. Both the indices
outperformed the Sensex.

The market breadth was strong. On BSE, 1,230 shares advanced as
compared to 1,073 that declined. 74 shares remained unchanged.

India's second largest telecoms services provider by sales,
Reliance Communication slipped 7.39% on BSE after Morgan Stanley
cut price estimate on the stock by 45% to Rs 280.

Tata Steel (down 5.36% to Rs 227) and Bharti Airtel (down 3.95% to
Rs 689) were the major losers from Sensex pack.

The BSE Oil & Gas index fell 5.33% and was the biggest loser from
the sectoral indices on BSE. India's largest private sector company
by market capitalization and oil refiner Reliance Industries (RIL)
slumped 9.57% to Rs 1,316 after ABN Amro recommended a 'sell' on
the stock and cut its target price by whopping 38% to Rs 1,150 from
Rs 1,850 earlier. The scrip was the biggest loser from the Sensex
pack.

GAIL India fell 8.82% despite signing a cooperation agreement with
the Himachal Pradesh state government for extension of the proposed
Dadri-Bawana-Nangal natural gas pipeline to the state.

PSU OMCs fell on reports the government may cut petrol prices by
around Rs 2 a litre and diesel by Rs 1 per litre to drum up support
with voters ahead of key state elections later this month. BPCL,
HPCL and Indian Oil Corporation fell by between 1.44% to 3.28%.

Meanwhile, crude oil fell in New York as investors judged
yesterday's 10% gain as excessive on signs of slowing fuel demand
after US auto sales dropped to their lowest in 17 years. Crude oil
for December delivery declined as much as $2.08, or 3 %, to $68.45
a barrel on the New York Mercantile Exchange today.

FMCG stocks were mixed. Britannia Industries, United Breweries,
United Spirits, ITC fell by between 0.19% to 6.22%. On the other
hand, Dabur India, Hindustan Unilever, Marico, Nestle India, Tata
Tea rose by between 0.99% to 3.44%.

Power stocks, too, were mixed. NTPC, Tata Power Company, Power Grid
Corporation of India fell by between 0.27% to 1.86%. Reliance
Infrastructure and Reliance Power rose by between 0.16% to 0.24%.

IT stocks jumped despite strong rupee and also shrugging off
worries the US outsourcing business will be curtailed after Obama
won the US presidential election. India's third largest IT exporter
by sales Satyam Computer Services rose 2.57% even as its American
depository receipt (ADR) fell 0.83% overnight.

India's fourth largest IT exporter by sales Wipro rose 2.51% as ADR
jumped 5.25%. India's second largest IT exporter by sales Infosys
gained 2.01%, as ADR rose 4.84%.

India's largest IT exporter by sales Tata Consultancy Services
jumped 6.55%.

Democrat Barack Obama has strong reservations on outsourcing from
the US. He had made many statements during his election speeches
that he would discourage outsourcing from the US when he comes into
power.

The rupee strengthened 1.61% to 47.40. A strong rupee affects the
IT companies as they earn most of their revenues in dollar terms.

Bank stocks came off the day's lows on reports public sector banks
are likely to cut deposit and lending rates by 50 to 75 basis
points within one week. India's largest commercial bank State Bank
of India was down 1.9% to Rs 1,296.10, off the day's low of Rs
1,265.60, after its chairman O P Bhatt said on 4 November 2008 the
bank was likely to cut interest rates by up to 50 basis points.

But Indian Bank fell 1.48% after early gains after the bank said
yesterday it will consider cutting its lending and deposit rates by
50-75 basis points this week.

State Bank of Bikaner & Jaipur was flat at Rs 2651.70 after it cut
its benchmark prime lending rate to 13.25% from 14%, effective 5
November 2008.

State Bank of Travancore rose 1.92% after bank fixed 20 December
2008 as the record date for 10 for 1 stock split.

India's largest private sector bank by net profit ICICI Bank lost
0.28% to Rs 459, off the day's low of Rs 441.10, after the American
depository receipt (ADR) spurted 7.28% overnight. ICICI Bank's
chief executive K.V. Kamath said on 3 November 2008, the bank will
review interest rates in the next few days.

India's second largest private sector bank by net profit HDFC Bank
rose 1.38% to Rs 1,126 off the day's lowof Rs 1105. The ADR jumped
7.63% on Tuesday.

However, India's largest home loan lender by operating income HDFC
fell 1.22% to Rs 1,902 off day's high of Rs 1,999.

Gammon India surged 6.40% extending gains for the fourth day in a
row, on bargain hunting after a recent sharp fall caused by poor
quarterly performance.

Shri Dinesh Mills hit 10% upper circuit after company fixed 27
November 2008 as the record date for for 10 for 1 stock split.