Reacting negatively to some budget proposals, particularly to the hike in coporate tax surcharge, higher surcharge on dividend distribution tax and the decision to continue interest rate subsidy on short term crop loans, the market saw some heavy selling on the Budget Day last week.
And the mood, despite a modest rebound on the final session last week, is likely to remain somewhat bearish, due largely to worries about the near term economic outlook.
With a slew of economic data due for release a week later, and the Reserve Bank of India to undertake mid-quarter review of monetary policy on 19 March, 2013, movements are likely to be quite listless over the next couple of weeks.
Automobile and cement stocks will be in focus early next week, with sales and shipments data from leading automobile and cement manufacturers setting the tone. Metal stocks are also likely to see some action, and production data for February 2013 will give some direction to investors.
The data on services sector performance will give some cues. The Markit Economics will release the monthly survey on the performance of the services sector on 5 March. The Purchasing Managers' Index, that gauges business activity had jumped to 57.5 in January, from 55.6 in December 2012.
The next trigger for the market will be the data on advance tax payments. The data on industrial production for January 2013, and the inflation data for February will also set the tone for the near term.
The positive close on Wall Street on Friday on the back of an upbeat economic report on U.S. manufacturing activity, is likely to set up a firm start for Asian markets on Friday.
Economic data from across the globe, and interest rate decisions by the Bank of England, the European Central Bank and the US Federal Reserve will provide some direction to the market.