US stocks rise as service industry activity improves; expect gap up (1%) opening for Nifty on Tue, Oct 6th.

US Market Update:-
Report that the service sector grew for the first time in more than a year gave investors a confidence boost and sent stocks higher. Financial stocks led the market Monday after Goldman Sachs raised its rating on large banks. Major stock indicators rose about 1 percent.

The Institute for Supply Management said its service index rose to 50.9 in September from 48.4 in August. Analysts polled by Thomson Reuters had expected a reading of 50, the dividing line between growth and contraction. The index tracks more than 80 percent of the country's economic activity and hasn't grown since August 2008.

Stocks have fallen in seven of the past eight days so some bounce in stocks wasn't surprising. The Dow has lost 332 points, or 3.4 percent, in the past two weeks. Bigger tests of the market will arrive in the coming weeks when companies begin turning in earnings reports for the July-September quarter.

A disappointing employment report Friday shook investors' confidence. The Labor Department said employers cut more jobs in September than in August. Economists had expected cuts would decrease. A drop in unemployment is considered vital to a sustained recovery.

Investors could begin to get a better sense of the health of the economy on Wednesday when quarterly earnings reports start arriving. Aluminum maker and Dow component Alcoa Inc. kicks off earnings season, and investors will be looking for signs of growth to ease recent concerns about the strength of a rebound.

Companies were able to mostly beat modest profit expectations in the second quarter primarily because of cost-cutting, including job cuts. Now traders will be looking for signs of growth in revenue to sustain improved earnings.

The dollar was mixed against other currencies, while gold prices rose. Crude oil rose 77 cents to $70.72 a barrel on the New York Mercantile Exchange.

-Team SLT