Market seen opening firm on upbeat global cues

The market is likely to open on a firm note on positive global cues. Positive US jobs data boosted Asian markets. But, the rise in crude oil prices may cap gains in Indian stocks. Trading of S&P CNX Nifty futures on the Singapore stock exchange indicates a gain of 15 points at the opening bell.



As per provisional figures, foreign funds bought shares worth Rs 415.28 crore and domestic funds sold shares worth Rs 412.63 crore on Friday, 1 April 2011.

Due to merger of settlements on account of bank holiday for Gudi Padwa festival on Monday, 4 April 2011, shares purchased on Monday, 4 April 2011 should not be sold on Tuesday 5 April 2011, brokers have advised clients.

The near term major trigger for the market is Q4 March 2011 results which will start trickling in from about mid-April 2011. Investors will scrutinize post-result management commentary to gauge outlook on earnings at a time when rising salaries, raw materials prices and interest rates are pressurizing profit margins of India Inc.

India's merchandise exports rose 49.7% to $23.5 billion in February 2011 from February 2010, according to provisional data issued Friday by the Ministry of Commerce. The government didn't give any reasons for the growth in exports. Imports rose 21.2% to $31.7 billion, largely due to a rise in non-oil imports, which were up 31% from a year earlier to $23.4 billion. Oil imports in February fell 0.3% to $8.21 billion. India's February trade deficit narrowed to $8.1 billion from $10.4 billion a year earlier, the data showed. Oil imports during April to February, the first 11 months of the just-ended fiscal year 2011, rose 12.4% to $88.1 billion, while non-oil imports rose 20.4% to $217.1 billion.

A survey showed on Friday that the strong pace of expansion in India's manufacturing sector steadied in March 2011, helped by sustained new orders and output, while input prices were at their highest in at least six years, signalling further inflationary pressures. The HSBC Markit Purchasing Managers' Index, based on a survey of around 500 companies, was unchanged at 57.9 in March 2011 from February 2011, the highest since November 2010.

Prime Minister Manmohan Singh said on Thursday the government will deal with the challenge of high inflation driven by rising oil, food and commodity prices because of political upheavals and natural disasters in some countries. He stated that the government wanted to manage inflation without disturbing the growth momentum. "I am hopeful of seeing lower levels of inflation in the coming months," he said. The Prime Minister also said the tax and financial sector reforms were on government agenda and the government would raise resources through sale of equity in the public sector firms. The government is expected to raise Rs 40000 crore in the year ending March 2012 through sale of stake in state-run firms.

India imports majority of its crude oil requirements and a surge in crude oil prices over the past few months has sparked inflation and interest rates worries. High oil prices have also raised concerns about higher oil subsidy bill for the government and its negative impact on the government's fiscal position. US crude futures up 61 cents a barrel or 0.57% at $108.55 a barrel as positive US jobs data reinforced economic growth expectations and as the ongoing conflict in West Asia and the Middle East kept investors worried about supply disruptions.

Billionaire investor and international investment icon Warren Buffett who was in his maiden visit to India last month said that he hopes to spend some money in India. His firm Berkshire Hathaway is looking to park funds in large investment destinations and India fits the bill perfectly, he said. India, according to him, is not an emerging market but a very big country with a large number of significant businesses. He said that Berkshire Hathaway would look at possible acquisitions in India as and when there were opportunities.

Asian stocks rose on Monday after a report showed US jobs grew faster than forecast. The key benchmark indices in Hong Kong, South Korea and Singapore were up by between 0.28% to 1.08%. Indonesia's Jakarta Composite slipped 0.13%. The Chinese market is closed today, 4 April 2011, for a local holiday.

US stock markets closed higher on Friday as traders welcomed a drop in US unemployment. The Dow Jones Industrial Average rose 56.99 points, or 0.46%, to 12,376.72 points. The S&P 500 index rose 6.58 points, or 0.50%, at 1,332.41 points and the Nasdaq Composite index rose 8.53 points, or 0.31%, at 2,789.60 points.

A US government jobs report showed the US unemployment rate dropped to a two-year low of 8.8% in March 2011 from 8.9% in February 2011. Payrolls grew by 216,000 workers after a 194,000 gain the prior month, the Labor Department said.