The market is likely to start the week on a firm note following the home minister P Chidambaram and the government getting a breather following the 2G trial court dismissing the petition filed by Dr Subramanhyam Swamy to include P Chidambarm as a co-accused in the 2G spectrum case. However, some telecom stocks are likely to find the going tough due to the cancellation of the 122 licenses issued during the tenure of former telecom minister A Raja.
Among the companies that are slated to announce their quarterly results next week are Hindustan Unilever, Mahindra & Mahindra, Bharti Airtel, ONGC, Power Grid Corporation, Tata Steel, Hindalco, Nalco, ACC, Ambuja Cements, Tech Mahindra, Tata Power and GMR Infrastructure. PSU oil firms Hindustan Petroleum Corporation and BPCL will also report their earnings next week.
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A strong and sustained inflow of funds from foreign institutional investors has lifted the maket to impressive levels over the past few weeks. And it looks very likely that this set of investors will continue to pump in funds in the near term. FIIs were net buyers to the tune of over Rs 5800 crore last week, and according to data available from the exchanges, have pumped in over Rs 15,000 crore this calendar year.
With the recent batch of economic data turning out to be rather encouraging, the market stayed bullish on four successive sessions last week. The rupee's strong comeback against the U.S. dollar amid expectations of more fund inflow into the country too contributed substantially to the market's solid gains.
Though no negative news has cropped up to warrant a slide, some heavy profit booking is not ruled out altogether, considering the pace at which the market has rallied since late December 2011.
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A stronger than expected U.S. jobs report lifted the major indices to a positive close on Wall Street on Friday. While this could result in a steady start for stocks on the Asian bourses on Monday, concerns about the financial situation in Europe may weigh on sentiment and cap upside to a significant extent.
The market will be watching the developments in Europe, where plans are on for a second bailout deal for Greece. Investors will also be looking out for the outcome of the policy meetings of European Central Bank and the Bank of England.