The market is likely to open on a cautious note next week, with investors reacting to somewhat subdued third quarter GDP data, released after trading hours on Friday (28 February 2014). Concerns about widening fiscal deficit will weigh on sentiment to a notable extent.
According to the data released by the government on Friday, the country's GDP growth for October - December 2013 quarter, came in at 4.7%. In the September 2013 quarter, GDP grew at 4.8%, up from 4.4% in the preceding quarter.
Meanwhile, fiscal deficit in the ten months to January 2014 stood at Rs 5.32 lakh crore (101.6%), well past the revised estimate of Rs 5.245 lakh crore for the financial year.
On Monday, investors will get to know the performance of India's factories in February 2014, as Markit Economics will unveil the HSBC India Manufacturing PMI. Factory activity saw an improved reading of 51.4 in January 2014, surging up from 50.7 a month earlier.
A couple of days later, the survey result on the performance of India's services sector in February 2014 will be released by Markit Economics.
On the global front, crucial data from China (the Chinese factory activity in February), the outcome of the policy meetings of the European Central Bank and the Bank of England will be eyed.
The subdued close on Wall Street last Friday amid mixed global economic data is likely to set up a somewhat sluggish start for the Asian markets next week.
The rupee's movements will play a role as well in setting the trend for the market. The fortunes of IT and pharmaceuticals stocks, in particular, will depend largely on the rupee's performance against the greenback.
Automobile and cement stocks will be in focus with February sales and shipments data from leading automobile and cement manufacturers providing cues.