Indian shares ended lower on Wednesday, dragged down by private-sector lenders ICICI Bank and Axis Bank amidst sluggish global risk appetite.
The Sensex lost 205.71 points or 0.62 per cent to settle at 32,968.68, while the broader Nifty shed 70.45 points or 0.69 per cent to end at 10,113.70. Markets were shut on Thursday and Friday for public holidays.
On Wall Street, U.S. stocks surged on Thursday as technology stocks rebounded, led by Facebook, Intel, Alphabet and Microsoft shares.
The Dow Jones Industrial Average rose 254.69 points, or 1.07 percent, to close at 24,103.11 while the S&P 500 gained 35.87 points, or 1.38 percent, to 2,640.87.
Going head, analysts expect domestic stocks market to witness further selling pressure.
Based on the rollover data for April series, positions carried forward to the next series were higher than three-month averages but most of the positions rolled over to the Nifty April series were on the short side.
The Reserve Bank of India's monetary policy review on April 5 and news flow around the state elections, which are slated this year, will guide the domestic markets.
On the currency front, the Indian rupee closed at weaker against the U.S. dollar after the country's fiscal deficit widened sharply.
The partially convertible rupee ended at 65.18, down 0.32 percent from its previous close of 64.97.
Government reported a fiscal deficit of Rs 7.2 trillion for April-February or 120.3 percent of the budgeted target for the current fiscal year that ends this month.
So far this year, the rupee weakened 2 percent, while foreign investors have bought $2 billion in equity and sold $174 million in debt market.
Here's what to watch in the coming days.
RBI policy review
The Reserve Bank of India is likely maintain key interest rates at next week's monetary policy review on a cool-off in inflation, according to analysts.
Analysts at Morgan Stanley said the six-member monetary policy committee will vote in the same pattern as last policy review.
The central bank maintained a status quo for the third time last month wherein RBI held rate since August 2017, when it had brought down the key lending rate by 25 basis points to 6 percent from 6.25 percent.
Auto stocks will be in focus as the auto companies will start announcing monthly sales numbers for March 2018 starting from April 1.
Markit Economics will unveil the result of a monthly survey on the performance of India's manufacturing sector in March 2018 on April 2. The Nikkei India Manufacturing Purchasing Managers' Index (PMI) fell to 52.1 in February 2018 from 52.4 in January 2018.
Global economic data
U.S. ISM manufacturing PMI data for March will be unveiled on April 2 followed by ADP nonfarm employment change data on April 4 and nonfarm payrolls data and unemployment rate data on April 6.
Germany and UK will disclose their manufacturing PMI data for March on April 3.