Market may edge higher on better-than-expected US job data

The market may edge higher in early trade on gains in Asia stocks and stronger-than-expected US job data. The slowdown in the Indian economy is showing signs of moderation, Prime Minister Manmohan Singh said on Friday 4 December 2009. Finance Minister Pranab Mukherjee said on Friday, the Indian economy is expected to show strong growth in the October 2009-March 2010 period.

India could return to a higher growth trajectory of 8-9 % in two years, but it needs to invest more in infrastructure for sustaining such growth, World Bank president Robert Zoellick said on Friday. Excess liquidity in global markets is driving up prices of farm commodities, which could be potentially dangerous in the near term, Zoellick said.

The Reserve Bank of India (RBI) is likely to revise upwards growth forecasts for 2009/10 when it reviews policy in January 2010 and monetary action may be needed if inflation accelerates, Usha Thorat, a Reserve Bank of India (RBI) deputy governor said on Thursday 3 December 2009. Thorat, said India's exit from its loose policy would be a challenge and managing the crisis was easier than managing the recovery now.

Government data, last week, showed the economy grew at its fastest pace in 18 months expanding an annual 7.9% in the September 2009 quarter. C. Rangarajan, who heads the prime minister's Economic Advisory Council, said he expected 2009/10 growth close to 7%. The central bank is scheduled to review policy on 29 January 2009.

Foreign direct investment (FDI) into India in the April-October period was about $18 billion, Trade Minister Anand Sharma said on Friday. Between April and September, the first half of the 2009/10 fiscal year, foreign direct investment was in excess of $15 billion, Sharma said.

Meanwhile, Prime Minister Manmohan Singh arrived in Moscow, Russia on Sunday to ink billions of dollars of weapons deals and for talks on a landmark nuclear deal that could significantly widen atomic fuel imports from Russia.

Most of Asian markets rose on Monday on positive US economic data. The key benchmark indices in Japan, South Korea, Singapore and Taiwan rose by between 0.06% to 1.4%. But the key benchmark indices in China, Hong Kong and Indonesia fell by between 0.31% to 0.91%.

US markets ended higher on Friday, 4 December 2009 as employers cut less jobs than expected in the month of November 2009, which showed signs of improvement in the economy. The Dow Jones Industrial Average gained 22.75 points, or 0.2%, to settle at 10,388.90. The S&P 500 index rose 6.06 points, or 0.6%, to 1,105.98. The Nasdaq Composite Index added 21.21 points, or 1%, to 2,194.35.

US employers cut only 11,000 jobs in November 2009, the smallest decline since the recession started in December 2007. November unemployment rate also declined to 10% as against 10.2% in the month of October.

Countries should not rush to end fiscal incentives to help their economies cope with the global economic crisis, in order to build a base for sustained long-term growth, World Bank's chief economist Justin Lin said.

Justin Lin said on Sunday he expected full global economic recovery in 2013. He said countries should keep fiscal measures in place until 2012, despite concerns from policy makers about the risk of inflationary pressure from higher government borrowing to fund the plans,

Back home, the key benchmark indices lost ground on Friday as weak US services sector data fueled worries of a slower economic recovery. Stocks fell in Europe after mixed performance of Asian stocks. The BSE 30-share Sensex fell 84.14 points or 0.49% to 17,101.54 on that day.

As per provisional data, foreign funds on Friday, 4 December 2009, bought equities worth a net Rs 198.14 crore. Domestic funds sold stocks worth a net Rs 56.64 crore