State Bank of India led the gainers in the index with a rise of 6.6% to 1,563 rupees. The bank has agreed to acquire one of its seven affiliated banks State Bank of Saurashtra. ICICI Bank jumped 6% to 883 rupees. Smaller banks participated in the market rally as well. Federal Bank jumped 5.4% to 323.80 rupees and Kotak Mahindra increased 4.8% to 680 rupees. Indian Bank jumped 15% to 151 rupees.

Tata Steel jumped 3.7% to 604 rupees on the news that it plans to increase its steel production by 35 million tons to 61 million by the year 2015. L&T increased 3.9% to 2,539 rupees after the board approved international offering to raise $700 million.

Bajaj Auto jumped 2.8% to 2,295 rupees. The company plans to shift its production to Waluj from Akurdi location to take advantage of lower operating costs and sales tax. Tata Motors increased 3.4% to 680 rupees after the company Chairman Ratan Tata confirmed its interest in purchasing Jaguar and Land Rover divisions from Ford. Maruti Udyog jumped nearly 6% in the rally to 835 rupees.

NTPC added 2.4% to 167 rupees on the news that the company plans to sell 4.75% of its stake and increase public float of the company. Reliance Industries jumped 3.4% to 1,835 rupees. GMR infrastructure jumped 4% to 749 rupees after its subsidiary received order to build power project in Himachal Pradesh.

Real estate stocks jumped after trading volatile in the last two weeks. Parsvnath Developers gained 4.8% to 293 rupees after winning land development order for BEST, the local bus transportation operator in Mumbai.

Indiabulls Real Estate soared 11.5% to 497 rupees, Peninsula Land increased 11% to 464 rupees, and Unitech added 7.6% to 491 rupees.


[R]09:45AM Wall Street opened lower ahead of housing data.[/R]

Wall Street opened Monday session in the negative ahead of existing-home sales report, expected to show continuous slow-down in the housing market.

Dow member Home Depot (HD: chart) rose 1.8% on news that owing to a slashed price it managed to salvage the takeover of its supply unit. The home improvement retailer agreed to sell off its wholesale-supply unit for $8.5 billion, which is $1.8 billion less than previously planned, signaling a harsh financing climate.

Another blue-chip stock, Altria Group (MO: chart), climbed 2% amid speculations that it is considering spinning off the overseas division of its cigarette business. At the same time, General Motors (GM: chart) weighed, posting a decline of 1.3%.

A decline in crude oil prices also weighed on sentiment, dragging energy companies down. Exxon (XOM: chart) declined 0.5%, leading both the Dow and S&P 500 down. Shares of oil giant Chevron (CVX: chart) dropped 0.7%.

Merger-and-acquisition news was in the spotlight again, helping to offset some of the negative sentiment. Gateway (GTW: chart) soared 52%, boosted by news that Taiwan''s Acer will acquire the company for 710 million to create the world''s No.3 PC maker. Further on the deal news front, Chicago Bridge & Iron Co. (CBI: chart) agreed to buy Lummus Global from engineering-services company ABB (ABB: chart) for $950 million.

The Dow Jones industrial was down 40.64 points, or 0.30%, at 13,338.23. The Standard & Poor''s 500 fell 6.02 points, or 0.41%, at 1,473.35. The Nasdaq Composite dropped 6.41 points, or 0.25%, at 2,570.28.


[R]09:00AM U.S. stock futures pointed to flat opening ahead of housing data.[/R]

U.S. stock futures were trading near the unchanged mark on Monday, reflecting positive mood generated by takeover activity and cautiousness ahead of housing data. Acquisition deals were announced in the steel and personal computer sectors. U.S. Steel (X: chart) agreed to buy Canada''s Stelco for about $1.1 billion, while Taiwan''s Acer said it will acquire Gateway (GTW: chart) for $710 million, creating the world''s No.3 PC maker.

Among other pre-market highlights, Home Depot (HD: chart) rose 1.8% on news it tentatively agreed to sell its wholesale distribution business to a private equity group for $8.5 billion, which is $1.8 billion less than previously planned. The news suggested that struggling credit markets had tightened control over financing of deals. In deal speculations, Wal-Mart (WMT: chart) is reportedly interested in acquisitions in the U.S.

In economic news, investors will focus on existing-home sales report, searching for clues on whether the Fed will cut interest rates in the short term. Existing-home sales are expected to have fallen to 5.70 million in July from 5.75 million in June. S&P 500 futures fell 2.3 points. Dow Jones industrial average futures slipped 11 points, and Nasdaq 100 futures fell 5 points.