UPDATE FOR NOVEMBER 5

Weakness in European stocks and lower US index futures

pulled themarket sharply lower in what was a volatile

trading session. TheBSE Sensex declined 511.11 points or

4.81% %, with indexheavyweight Reliance Industries (RIL)

plunging close to 13% onbrokerage downgrade. The S&P

CNX Nifty fell below the psychological3,000 mark. Realty,

banking and metal stocks dropped on profittaking after

recent strong gains. Firm Asian stocks had triggered an

intra-day recovery on thedomestic market in afternoon trade

after it had slipped into thered in mid-morning trade after

a strong start. The market hadsurged earlier in the day

boosted by rally in Asian stocks,Democrat Barack Obama's

election as the next US president andexpectations that a

cut in interest rates by state-run banks wouldresult in lower

borrowing costs for the corporates. The early rally was also

triggered by a sentiment by the Commerceand Industry

Minister Kamal Nath after trading hours on Tuesday, 3

November 2008, that the government will further ease

foreigninvestment rules, including those relating to

defence production.

Trading in US futures suggested the Dow would fall 82 points

at theopening bell, as the focus shifted to the weak economy

afterObama's decisive win in the US presidential election.

Europeanmarkets which opened after the Indian market, fell

as the spotlightmoved back to the troubled economy after

the US presidentialelection. Key benchmark indices in

France, Europe and UK were downby between 1.44% to

1.88%. Asian markets, which opened before the Indian

market, surgedboosted end of the uncertainty about

who will lead the US economyin the midst of great

financial peril. Key benchmark indices inChina, Japan,

Singapore, Hong Kong, and South Korea were up by

between 1.76% to 4.46%. But the Taiwan Weighted fell 0.29%.