Monthly sales data from auto, cement firms eyed

A raft of macro economic data will be in focus early next week. The monsoon also holds key. The developments in the euro zone will also be closely watched as investors have remained cautious and stayed away from risky assets in the recent past amid persistent worries that the debt crisis in the euro zone could dent consumer spending in that region and slow a global economic recovery.

Foreign institutional investors (FIIs) have sold Indian shares worth a net Rs 13,067.32 crore so far this month, till 27 May 2010, according to data from the stock exchanges. They had bought stocks worth a net Rs 2667.35 crore last month. Domestic funds have bought stocks worth a net Rs 6092.31 crore so far this month, till 27 May 2010.

The government will unveil Q4 March 2010 GDP growth data on Monday, 31 May 2010. The government will also announce the infrastructure output data for the month of April 2010 on Tuesday, 1 June 2010.

Investors will also keenly watch HSBC purchasing manager's Index (PMI) index indicating manufacturing activity and the HSBC business activity index indicating services activity for the month of May 2010

Cement, auto and steel stocks will be in action as companies announce their sales figures for the month of May 2010.

Progress of the monsoon will be closely watched as any surprises here will have a serious impact on investor sentiment specifically after the last year's drought. The monsoon rains are likely to hit the country's southern coast in three to four days, the India Meteorological Department said in its latest forecast on 27 May 2010. Conditions are becoming favourable for onset of southwest monsoon over Kerala during next 3-4 days, the weather office said.

The weather office had said late last week that rains were on track to hit the country's southern coast on 30 May 2010, and the Laila cyclone in the Bay of Bengal would not derail the vital June-September rainfall. The India Meteorological Department (IMD) in late April 2010 said rainfall is likely to be 98% of the long-term average. Good monsoon rains would help raise farm output, boost rural incomes and lower food inflation.

The south west monsoon is important for India as about 60% of the country's farmlands are rain-fed and more than half of the workforce is employed in the agriculture sector. The quantum of rainfall in the crucial sowing month of July and distribution of rainfall during the monsoon season also holds key.

The results season is almost over. The combined net profit of a total of 2,657 companies rose 13.8% to Rs 70,690 crore on 25.4% rise in sales to Rs 7,35,191 crore in the quarter ended March 2010 over the quarter ended March 2009.

Mahindra & Mahindra will announce its Q4 March 2010 result on Saturday, 29 May 2010.