Indian share markets will be cautious next week when a second round of corporate quarterly earnings takes place. There is no clear direction for the main indices at the current levels, dealers said.
The markets were disappointed with this week's release of quarterly earnings from frontline software exporter Infosys, with stock falling nearly three percent despite a 37 percent jump in June-end net profit.
The Mumbai stock exchange's 30-share Sensex closed the week at 7,271.54, up 59.46 points over the previous week's close of 7,212.08.
"The Reliance de-merger formula and the performance of some of the other Sensex heavyweights like Wipro, Hindustan Lever and motorcycle maker Bajaj Auto will determine trends over the short-term," said Manoj Kakaiya, dealer with ULJK Securities.
The markets will keep a close eye on the macro-economic picture arising from the quarterly credit policy review set from India's central bank later this month.
Foreign fund flows continue to be a key trigger for the Indian markets.
Overseas funds were net buyers of Indian stock worth five billion dollars in the first half of 2005.
"We expect some amount of profit-booking to take place at higher levels. The markets are at a stage where stock portfolio churning will be necessary for large mutual funds to ensure strong returns for unitholders," said Hemen Kapadia, analyst with investment advisory firm Morpheus Inc.
"The trading action has thus shifted slightly from large-sized Sensex heavyweights to mid-sized companies."
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