Market observers pointed out that global crude oil prices along with the expectations of a healthy third quarter (Q3) earning result season would also influence the market's movement.
During the trade week starting December 30, key macro-economic data points such as the eight core industries' output, external debt, PMI numbers and monthly automobile sales' figures will be released.
"Monthly automobile numbers will be announced leading to some movements in their stock prices," HDFC Securities' Retail Research Head Deepak Jasani said.
"Core infra data for November and the PMI Manufacturing number will impact market mood in the coming week."
Edelweiss Professional Investor Research's Chief Market Strategist Sahil Kapoor said that stocks are likely to see low volume consolidation in the upcoming week.
"The uptrend remains intact and market breadth is improving.
"More and more stocks are now beginning to trade at multi-week and multi-month highs. This is a positive sign. We continue to believe that Nifty is likely to head towards 13,500 by Q2FY21," he said.
Vinod Nair, Head of Research at Geojit Financial Services, said: "Global markets seem to be in comfort zone fuelled by hopes of easing trade tension which will add adequate liquidity to emerging markets like India."
Sector-wise, Motilal Oswal Financial Services' Retail Research Head Siddhartha Khemka said: "Going ahead, we believe large private banks, consumer or FMCG, core sectors like cement and capital goods, would do well."
Furthermore, the movement of Indian rupee against the US dollar and crude oil prices will also set the course of key indices.
"With crude hovering at more than $68 level... Expect rupee to touch 72 to a USD, if crude advance continues," said Sajal Gupta, Head Forex and Rates, Edelweiss Securities.
Last week, the Indian rupee closed at 71.36 against the US dollar.
On the technical charts, the short-term trend of the National Stock Exchange's (NSE) Nifty50 remains' positive.
"Technically, while the Nifty has corrected marginally this week, the index remains in an intermediate uptrend," Jasani said.
"Further upsides are likely once the immediate resistances of 12,287-12,294 are taken out. Crucial supports to watch for resumption of weakness are at 12,118-12,046."
(Rohit Vaid can be contacted at rohit.v@.in)
( With inputs from IANS )