CLOSING...The momentum revives...

After
two days of lackluster trade, markets ended firm today with the
benchmark indices advancing by more than 1%. While buying was witnessed
in auto, banking, power, cement and software stocks, select pharma and
media stocks ended in the red. On the sectoral indices front, BSE FMCG
(up 1.5%) and the BSE Auto Index (up 1.2%) emerged as the key gainers.
As far as global markets are concerned, Asian markets ended mixed.
European indices too have opened on a cautious note.

The
BSE Sensex closed at 15,616 (up 170 points) while the NSE Nifty closed
at 4,519 (up 43 points). The rupee was trading at 40.92 to the dollar.

Amidst
weak global cues, the BSE Sensex opened with a negative gap of more
than 60 points (0.4%). However, the index soon pared its losses to
enter into the positive territory. Thereafter, the index proceeded to
trade higher for the rest of the trading session and finally closed
with a gain of 1.1%. The overall market breadth was positive with
gainers outnumbering the losers in the ratio of 4.6 to 1 on the Nifty.
Reliance Energy (up 5%), Grasim and Ranbaxy (each up 4%) were the key
gainers on the NSE.

Reliance
Energy is planning to hive off its engineering, procurement and
construction (EPC) division into a new company. REL is considering the
option to list the new company to raise funds for its projects. The EPC
division has an order backlog of Rs. 70 bn. The EPC division's revenue
was Rs 20.8 bn in FY07, almost a third of company's total revenue of Rs
65.8 bn. The EPC division has contributed about 8% of the net profit of
Rs. 8 bn of Reliance Energy. Reliance Energy (up 5%) along with its peer Tata Power (up 3%) closed firm today.

Pharma closed mixed today with Ranbaxy, Dabur Pharma (each up 3%) and Cipla (up 1%) leading the pack of gainers, while Matrix Labs (down 4%) and Divi's Lab (down
1%) closed in the red. As per a leading business daily, Ranbaxy has
completed the second phase of the clinical trials of a revolutionary
anti-malarial drug that could enable it to be the nation's first
pharmaceutical company to launch a New Chemical Entity (NCE) globally.
The company has just finished phase II clinical trials and is doing a
phase II for the combination of that product. If everything continues
to be successful, Ranbaxy will be able to launch the NCE in the market
by 2011. While two to three dozen new molecules are being developed for
cardiovascular, arthritis, diabetes and oncology, there have been just
two products launched in the last 30 years for malaria. Though the
market size is considered small the competition is not likely to be
intense.

As per a leading business daily, Mahindra and Mahindra
(M&M) is planning to acquire a design firm in Italy to upgrade its
skills. The company has been looking for overseas buys to expand its
business. It has also been reported to be eyeing Ford Motor's brands
Jaguar and Land Rover. Though details regarding the deal have not yet
been divulged, the move is part of company's global strategy to source
the best product. Further, its manufacturing unit in Chennai which is a
joint venture with French carmaker Renault and Japan's Nissan, would be
operational in two years. The companies had formed a JV to make cars
with an investment of Rs 40 bn. The plant would have a capacity of 0.4
m cars and utility vehicles and would make models of all three
partners, besides power train for Renault and Nissan. These ventures
would help the company develop new models and increase its presence.
M&M along with its peers Tata Motors and Ashok Leyland closed firm today (each up 2%).

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