MARKET VIEW 20.10.2009

Markets ended in the negative terrain on Tuesday after
returning from a sparkling Diwali break. The start seemed to be
quite promising; however bulls were unable to hold on to their
gains as key indices witnessed a constant declining intra-day
trend.
The BSE Sensex erased nearly 230 points while the NSE Nifty
wiped out almost 70 points from their respective intra-day
high. The index heavyweights like Reliance Industries, ONGC, M&M and RCom were the major laggards. Weak start to the equity markets across Europe further dampened the sentiment on Dalal-Street.The BSE Sensex fell 103 points at 17,223 after touching a high of 17,457 and a low of 17,185. The index opened at 17,414 against the previous close of 17,326. The NSE Nifty slipped 29 points to shut shop at 5,112.
The tussle between the two brothers seems to be far from over after the Supreme Court on Tuesday adjourned the hearing for the gas dispute. Shares of Reliance Industries slipped 2% to end at Rs2183. On the other hand, shares of RNRL gained by 1.2% to end at Rs87.9.RNRL is fighting with the Reliance Industries for supply of gas at US$2.34 per mBtu based on a family
agreement between the two brothers. However, the centre told the Supreme Court that the terms of a MoU signed between Reliance Industries and RNRL on supply of gas from the KG basin violated the production sharing contract between Reliance and the government.
According to the MoU, Reliance is to supply 28mmscmd of gas to RNRL at US$2.34 per mmBtu which is at a 44% discount to a price of US$4.20 per mmBtu fixed later by the government for sale of gas by Reliance to some power and fertilizer companies.