Indian shares rise 4th day; Reliance, SBI rally

* Main index gains 2.1 pct to best close in 2 weeks

* Reliance up 3.5 pct on likely overseas buy report

* State Bank firms 5.2 pct as its sells stake in UTI AMC

* Telecom stocks lag on bleak sector outlook
(Updates to close)

By Ami Shah

MUMBAI, Nov 9 (Reuters) - Indian shares climbed 2.1 percent
on Monday, extending a winning streak to a fourth consecutive
session, with Reliance Industries (RELI.BO) leading the way
after a newspaper said the energy giant was close to an
overseas buy.

Firmer global stocks after the Group of 20 pledged to keep
stimulus in place until there was assured recovery, after data
showed the U.S. unemployment rate rose to a 26-year high also
helped sentiment. [ID:nL9362990]

Reliance, which has the most weight in the main index, rose
3.5 percent to 2,024.55 rupees after the Economic Times
reported it was close to a nearly $6 billion overseas
acquisition and the likely target was the assets of bankrupt
petrochemicals firm LyondellBasell [ACCEIN.UL]. [ID:nBOM433676]

"It would be a good buy at a time when the world braces for
recovery," said Prayesh Jain, a research analyst with India
Infoline. "Reliance has a huge cash pile and is comfortable
with the leverage position. If this acquisition does happen, it
will not really burden its balance sheet," he said.

The 30-share BSE index .BSESN closed up 2.11 percent, or
340.44 points, at 16,498.72, its best close in two weeks.
Twenty-five of its components advanced.

"There is a lot of speculative buying happening, with
positive global cues supporting," said Ambareesh Baliga,
vice-president of Karvy Stock Broking.

"But, the worry is the valuations are expensive. The
correction we saw recently was warranted," he said.

State Bank of India rallied 5.2 percent to 2,318.55 rupees,
after the top lender said it had entered into an agreement with
T. Rowe Price (TROW.O) to sell a 6.5 percent holding each in
UTI Asset Management Company and UTI Trustee Company.
[ID:nBOM135340]

Private lender ICICI Bank (ICBK.BO) firmed 4.7 percent and
HDFC Bank (HDBK.BO) rose 4.1 percent.

The benchmark index has risen 71 percent since the end of
2008, powered by foreign fund inflows of more than $14 billion.

On Sunday, the finance minister said the timing for winding
down stimulus measures would be decided when it was apparent
the economy is recovering, but there would be no more stimulus
measures. [ID:nBOM425910]

Prime Minister Manmohan Singh said on Sunday growth in the
next fiscal year, assuming a normal monsoon season, was
expected to be more than 7 percent compared with a 6.5 percent
forecast for the 2009/10 fiscal year. [ID:nBOM425840]

In the broader market, gainers outnumbered losers in the
ratio of 2.7:1 on a relatively moderate volume of 361 million
shares.

Telecom stocks fell as the sector outlook remained weak
after disappointing quarterly results and a deepening price
war, analysts said.

Bharti Airtel (BRTI.BO) fell 3.9 percent to 307.50 rupees
while rival Reliance Communications (RLCM.BO) was down 2.2
percent at 174.10 rupees.

Bharti Chief Executive Manoj Kohli said industry-wide
average revenue per user (ARPU) would continue to fall on
rising competition, but the ongoing price war was only a
short-term phenomenon. [ID:nBMA006378]

On Sunday, Chairman Sunil Mittal said the company was not
actively seeking acquisitions. [ID:nSP410388]

Cigarette to hotel business ITC (ITC.BO) raced 3.9 percent
while personal care products maker Hindustan Unilever (HLL.BO)
shed 0.7 percent, after Morgan Stanley added ITC to its focus
list and removed Hindustan Unilever from the same.

Hozefa Topiwalla, analyst at Morgan Stanley, said ITC was
in a strong position in one of the most attractive cigarette
markets in the world and was demonstrating strong pricing
power. He recently upgraded ITC to overweight from
equal-weight.

The 50-share NSE index closed 2.1 percent higher at
4,898.40.

STOCKS THAT MOVED

* Mahindra Satyam (SATY.BO) jumped 10.7 percent, its
biggest single-day gain in 3-½ months, to 114.45 rupees after
the outsourcer's chief executive said on Sunday the worst was
over and it had added 35 clients since mid-April, while it lost
just a handful. [ID:nSP416061]

* Hindustan Construction Co (HCNS.BO) rose 2.6 percent to
137.65 rupees after its chairman said the company expects its
order book to rise by a quarter to about 200 billion rupees
($4.3 billion) for the year ending March 2010. [ID:nHKG445113]

*

MAIN TOP 3 BY VOLUME

* Suzlon Energy (SUZL.BO) on 15.6 million shares

* Mahindra Satyam on 15.5 million shares

* Unitech (UNTE.BO) on 13.2 million shares

FACTORS TO WATCH
* For technical analysis double click on www.reutersindia.net
* India rupee report
[INR/]
* India bond report
[IN/]
* Euro above $1.50 as dollar extends post-G20 losses
[FRX/]
* Oil jumps $1 to above $78 on hurricane, dollar
[O/R]
* Stocks rise, dollar falls after stimulus pledge [MKTS/GLOB]
* U.S. stock futures point to gains after G20
[.N]
* For closing rates of Indian ADRs
INADR
(Editing by Ranjit Gangadharan)