The monthly inflation data, the RBI's mid-quarter policy review, and the advance tax numbers

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will decide the mood of the market investors in the coming week, who have turned cautious after the massive earthquake in Japan on Friday, say experts.

The stock market benchmark Sensex plummeted by 312.36 points, or 1.68 per cent, last week, largely on account of the political drama between the DMK and Congress, the string of downbeat economic reports from Japan to the US, and escalation of violence in Libya.

Analysts opine the earthquake in Japan, which triggered a massive Tsunami and killed dozens of people is unlikely to have any immediate impact on the Indian markets next week.

"There should not be any immediate impact of the Japan massacre on the Indian stock market and the companies shares having operations in Japan in the coming week, but there may be some selling on the announcement of loss estimates in the later part of the week," Geojit BNP Paribas Financial Services Research Head Alex Mathews said.

Market observers feel the investors who ignored the positive domestic economic data, better than estimated IIP numbers, strong exports and sharp fall in food inflation last week, are looking at positive surprises from the advance tax numbers, monthly inflation data, RBI's mid-quarter policy review next week.

"Next week will be an important one as markets will react to monthly inflation data, RBI's mid-quarter policy review and the Fed meeting," IIFL Head of Research (India Private Clients) Amar Ambani said.

The RBI is widely expected to raise key policy rates by 25 basis points at its mid-quarter policy review on 17 March 2011, said an expert.

Besides, the strong macro-economic picture should lift the investor sentiment, said an expert.

"The overall macro factors are encouraging. Food inflation declined to 13-week low at 9.52 per cent, IIP numbers beat street estimates at 3.7 per cent were positives. UPA's settlement on the seat sharing front with DMK is also viewed positively," Motilal Oswal Securities Manager & Analyst (Derivatives) Bhavin Desai said.

The crude oil prices which have slumped below USD 100 per barrel may also provide some respite to the tumbling street, said an analyst.