Market to open little higher

The market may see a flat-to-positive start, extending Saturday's rise, on follow-up buying. The S&P CNX Nifty futures for February 2010 expiry were trading 11.50 points higher in Singapore. Asian markets were trading mixed today. However, volatility may remain high as investors may remain cautious over sovereign debt problems in the euro zone.

The key benchmark indices jumped during the 90-minutes special trading session held on Saturday, 6 February 2010, tracking a strong intraday rebound of US stocks on Friday, 5 February 2010. The US unemployment rate surprisingly fell to a five-month low in January 2010, data showed on Friday. The BSE 30-share Sensex rose 124.72 points or 0.79%.

US markets had closed slightly higher on Friday, 5 February 2010 as US unemployment rate surprisingly fell to a five-month low. The Dow Jones Industrial Average staged a sharp pullback in late trade to erase a 167-point drop in the final hour of trading on speculation the European Union may propose a solution for Greece's budget deficit. The Dow Jones Industrial Average gained 10.05 points, or 0.1%, to 10012.23. The Nasdaq Composite Index was up 15.69 points, or 0.74%, to 2141.12. The Standard & Poor's 500 Index was up 3.08 points, or 0.29%, to 1066.19.

The US unemployment rate surprisingly fell to a five-month low of 9.7% in January 2010 and factory payrolls grew for the first time since 2007, hinting at a labour market recovery even though the economy lost 20,000 jobs.

Asian stocks fluctuated today as electronics makers fell on lower earnings, while commodity companies climbed after oil and metal prices increased. The key benchmark indices in China, Hong Kong, Japan and South Korea were down by between 0.07% to 0.49%. However indices in Singapore and Taiwan were up 0.29% and 0.15% respectively.

Back home, the Centre of Statistical Organization (CSO) will on Monday 8 February 2010 release the advance estimates of GDP growth for 2009-10. It will be based on the provisional data for the first half of the year and partial data for third quarter and no data on the fourth quarter, which contributes the highest to the annual Gross Domestic Product. The advance estimate will facilitate in the making of the Union Budget, to be presented in Lok Sabha on 26 February 2010.

The government will announce the industrial output data for the month of December 2009 on Friday, 12 February 2010. The industrial output rose 11.7% in November 2009.

Chairman of the prime minister's economic advisory council C. Rangarajan on Friday said the government is no hurry to roll back economic stimulus measures in one go. He also said that efforts will be made in the budget later this month to lower the fiscal deficit. It has been pointed out repeatedly that the process of exit must be gradual, coordinated and must not be sudden, should not disrupt the economy and efforts will be made to bring down the fiscal deficit in the coming budget, Rangarajan said.

Fast food chain operator Jubilant FoodWorks, which raised Rs 329 crore through initial share sale last month, debut on the bourses today, 8 February 2010. The company would list over 6.36 crore shares on the bourses at an issue price of Rs 145 a piece, the upper end of the price band.

The follow on public offer of the government-run power major NTPC, the first mega public offer of 2010, managed to scrape through with the issue getting subscribed 1.2 times. The issue, through which the government is divesting 5% of its stake, at a floor price of Rs 201 a share, opened on 3 February 2010 and closed on 5 February 2010. At the floor price, the follow-on-public offer (FPO) is valued at Rs 8,286 crore.

As regards government's divestment plan, Rural Electrification Corporation (REC) will be the next Government- owned entity to come out with a follow-on public offer (FPO). Its 17.1-crore share FPO will open on 19 February 2010 and will close on 23 February 2010. This will be followed by NMDC's FPO.

As per reports, in the next fiscal, the Government is likely to divest its stake in state-run firms such as Engineers India, Coal India through initial public offers (IPOs) and Power Grid and Sail through FPOs.

India can gradually start raising interest rates as Asia's third-largest economy is among the first to recover after the global financial crisis, the International Monetary Fund (IMF) said in a report published on 4 February 2010 on its website. India's economy is one of the first in the world to recover and the central bank should take a gradual approach to ensure the recovery reaches its full potential, the IMF report said.

As per provisional figures on NSE, foreign funds sold shares worth Rs 28.45 crore and domestic funds bought shares worth Rs 32.48 crore on Saturday, 6 February 2010.

Following rising prices of potato and pulses, food inflation rose to 17.56% in the week ended 23 January 2010 from 17.40% in the previous week, government data released on Thursday showed. The inflation for primary articles, which include food and non-food items, marginally eased to 14.56% in the reporting week from 14.66% in the previous week. The fuel price index rose 5.88%

Pronab Sen, the country's chief statistician, said on Wednesday the government should wait till May to roll back stimulus, as the strength of the demand recovery visible in available data may not be for real, pulling the finance minister, Pranab Mukherjee, away from a policy direction which the Reserve Bank of India (RBI) desires.

The advance estimates on economic growth for the current fiscal ending March 2010 will be released on Monday. It will be based on the provisional data for the first half of the year and partial data for third quarter and no data on the fourth quarter, which contributes the highest to the annual Gross Domestic Product.