RBI policy, Q1 earnings and global cues likely to drive Dalal Street after strong weekly rebound
Mumbai, Aug 2
Indian equity markets will enter the new trading week with investors closely tracking the Reserve Bank of India's monetary policy decision, a fresh round of June quarter earnings, global geopolitical developments, crude oil prices and foreign institutional investor flows after benchmark indices staged a strong recovery in the previous week.
The market snapped its recent losing streak as easing crude oil prices, improving geopolitical sentiment, strong corporate earnings for the April-June quarter and renewed buying by foreign institutional investors lifted investor confidence.
The decline in crude oil prices from recent highs helped ease concerns over imported inflation, pressure on corporate margins and India's external account, providing support to equities.
The Nifty advanced 2.59 per cent during the week to close at 24,383.60, while the Sensex gained 2.68 per cent to settle at 78,094.64. Both benchmark indices also recorded their second consecutive monthly gain in July.
Commenting on Nifty technical outlook, experts said that a decisive close above the 24,500-24,600 zone could extend the rally towards 25,200.
"On the downside, 24,100 is expected to provide immediate support, followed by a stronger support zone in the 23,600-23,800 range," an analyst stated.
The RBI's Monetary Policy Committee (MPC) meeting will be the key domestic event this week. The three-day meeting will begin on August 3, with the policy decision and RBI Governor's statement scheduled for August 5.
Investors will closely monitor the central bank's commentary on inflation, economic growth and the future interest rate trajectory for cues on market direction.
Corporate earnings will remain another major driver as several heavyweight companies are set to announce their financial results for the first quarter of FY27.
Global developments will also remain on investors' radar amid persistent tensions in the Middle East. US President Donald Trump warned of additional strikes on Iran as Washington stepped up efforts to reopen the Strait of Hormuz.
Crude oil prices will continue to be closely monitored after ending Friday more than $1 per barrel higher and registering their strongest monthly gains since March amid concerns over global supply disruptions following reports that some oil tankers had reversed course in the Strait of Hormuz.
— IANS
Reader Comments
Good to see FIIs coming back after weeks of selling. The Middle East situation is still a worry though — any escalation and crude will spike again, putting pressure on everything from fuel prices to the rupee. I hope the government is prepared for all scenarios. As an investor, I'm staying cautious but not panicking.
The Q1 earnings season has been quite encouraging, especially in IT and FMCG. But I'm a bit concerned about the mid-cap and small-cap valuations — they've run up a lot and could correct sharply if there's any bad news. Sometimes I feel the market is ignoring the risks and only looking at the positives.
It's a relief to see the market rebound, but honestly, the street is too focused on foreign flows. Domestic retail investors are the real backbone now, and we proved that during the volatile days. Let's hope the RBI provides some clarity on rates so that businesses can plan better. 🤗
As someone who's been tracking emerging markets from New York, India's resilience is impressive. The combination of a strong earnings season, a stable government, and moderate oil prices makes it a standout. The only thing I'd flag is the global sentiment — if the US economy shows more softness, there could be waves across all markets.
The Strait of Hormuz tension is scary, but I feel India has done well to diversify its oil imports. Also, the RBI's focus on growth is the right move — we need lower interest rates to push consumption and manufacturing. Let the market celebrate the rebounds, but the real test is consistency.