Strong US job data may lift Indian markets

Indian markets may be see an upside in the coming sessions, with stock-specific action based on corporate results. Although certain amount of profit booking cannot be ruled out.

US stock futures shot up in opening trades on Friday, 5 October 2007 after government data showed the economy added more jobs than expected in September 2007, easing worries about the outlook for growth and profits. The US Labor Department said the economy added 110,000 jobs.

Factors that would predict market trend in the coming weeks include quarterly results from Infosys and the board meeting of DLF to consider overseas acqusitions and raising funds offshore on Thursday, 11 October 2007. Quarterly results from HDFC Bank and Reliance Industries annual shareholder meeting on Friday, 12 October 2007.

The market will be keenly watching developments on the political front as India's political crisis over a controversial nuclear deal with the United States could enter a decisive phase as the government and its communist allies hold talks to resolve their bitter row. A joint panel formed to try and end the face-off will make a fresh attempt to convince communist leaders who have threatened to end their support to Prime Minister Manmohan Singh's coalition if it pursues the historic pact.

Annual inflation, based on the wholesale price index (WPI), moved up 3.42% in the week ended 22 September 2007 from 3.23% in the week ended 15 September 2007. The rise in inflation is due to increase in prices of manufactured products, with a 63.75% weight in WPI. Food products like salt and oil became dearer in the week.

Foreign institutional investors (FIIs) bought shares worth a net Rs 575 crore on Thursday, 4 October 2007, compared to their buying of Rs 3,161.50 crore on 3 October 2007. FII inflow of Rs 575 crore on 4 October 2007 was a result of gross purchases of Rs 4,403.80 crore and gross sales Rs 3,828.80 crore.