Data late on Thursday showed India's gross domestic product grew 6.3 percent in July-September, in line with expectations, as businesses started to overcome troubles after the bumpy launch of a national sales tax.
The data failed to lift sentiment fiscal deficit reached 96 percent of the budgeted target for the fiscal year ending in March 2018, sending shares sharply lower on Thursday.
The Reserve Bank of India (RBI) is also meeting next week at a time of rising concern about a rally in crude prices, which rose following OPEC's decision to extend production curbs.
Nearly all analysts expect the central bank to keep rates on hold.
"Since there was a sharp run-up in the markets last week, there is a bit of profit-booking. Even though the GDP number is along expected lines, there is concern building up on the fiscal deficit front," said Hitesh Agarwal, EVP & Head - Retail Research, Religare Securities Ltd.
Both indexes were down around 1.7 percent for the week, heading for their biggest weekly loss since late September.
Indiabulls Housing Finance Ltd led losses on the NSE index, falling as much as 2.1 percent. The stock had gained in the last five sessions.
Banking stocks weighed on both indexes ahead of the RBI meeting. State Bank of India fell as much as 0.9 percent while ICICI Bank Ltd lost 0.8 percent.
However, the Nifty auto index gained about 1 percent as automakers reported sales for November. A private survey on Friday showed factory activity accelerated last month to the fastest pace since late last year, driven by a surge in new orders.
Maruti Suzuki India Ltd rose 1.1 percent after posting a 14 percent rise in November sales. Tata Motors Ltd, expected to report later in the day, rose as much as 1.4 percent.
© Thomson Reuters 2017
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