Benchmark indices opened Wednesday's session on a cautiously positive note, with the Sensex climbing 397.59 points to 78,826.54 and the Nifty 50 gaining 62.7 points to 24,677.60 in early trade as of 10:38 AM on August 5. According to The Hindu, this represents a significant recovery from Tuesday's session when the Sensex declined 210.08 points, or 0.27%, to settle at 78,428.95 and the Nifty dropped 159.40 points, or 0.64%, to end at 24,614.90. The latest gains were driven by falling crude oil prices and continued foreign fund inflows, with GIFT Nifty futures having pointed to a stronger open, trading above the 24,700 level ahead of the bell.
Brent crude, the global oil benchmark, traded 1.16% lower at $78.44 per barrel in the latest session, continuing the downward trend that began with the previous day's 5% overnight fall to a three-week low, slipping below $80 per barrel. The sustained decline in oil prices is significant for India, a major crude importer, as it eases pressure on inflation, the current account deficit and the rupee. As per The Hindu BusinessLine, Dr. VK Vijayakumar, Chief Investment Strategist at Geojit Investments, noted that "the sharp dip in Brent crude to below $80 and record closing in the U.S. markets augur well for the Indian market today." The focus of the market today will be the RBI's Monetary Policy Committee decision, with the central bank widely expected to hold the repo rate at 5.25% and maintain a neutral policy stance.
Foreign Institutional Investors purchased Indian equities worth ₹2,446.47 crore on Tuesday, extending their buying run for a sixth consecutive day. However, Domestic Institutional Investors turned net sellers, offloading equities worth ₹936 crore as they booked profits following the recent market rally. According to The Hindu BusinessLine, Vijayakumar noted that "it appears that the market is poised for a breakout on the upside," citing growth resilience, improving corporate earnings and FIIs turning net buyers for a sixth consecutive day. In calendar year 2026 to date, FII equity outflows still stand at $26.5 billion, while DII equity inflows have reached $53.7 billion. As per HST Wealth's Hariselvan Radhakrishnan, "Domestic sentiment has also improved as foreign portfolio investors continue to rebuild positions in Indian equities following a prolonged period of outflows."
Among Nifty 50 gainers in early trade, InterGlobe Aviation, Mahindra & Mahindra, Trent, NTPC, Larsen & Toubro and Bajaj Finserv were among the major winners. On the losing side, Sun Pharma, Tata Consultancy Services, Titan and Bharat Electronics were among the laggards. In Tuesday's session, Realty was the biggest laggard, declining 2.40%, followed by Oil & Gas, FMCG and IT, while Media and Metal were the only sectors to close in the green, with the Media index gaining 1.80%. The RBI's Monetary Policy Committee decision is the principal event risk for the session, with the central bank widely expected to hold the repo rate at 5.25% and maintain a neutral policy stance.
Asian markets followed suit, with South Korea's KOSPI jumping 4% and Japan's Nikkei 225 index climbing 3%, while Shanghai's SSE Composite index and Hong Kong's Hang Seng index were also trading higher. The overnight session on Wall Street was driven by a surge in technology stocks tied to artificial intelligence spending, with The Dow Jones Industrial Average surging 907.47 points or 1.7%, the S&P 500 advancing 1.8% to its first record close since June, and the Nasdaq Composite rallying 2.6%, now nearly 9% higher since last Wednesday. Microsoft shares surged 25% over three days on strong quarterly results, with its Azure cloud unit nearing a $100 billion annual revenue run rate, while Palantir Technologies jumped nearly 30% after beating quarterly estimates and raising its full-year revenue guidance. The recent recovery in the rupee, supported by softer crude oil prices and improving global risk sentiment, has further enhanced the appeal of Indian financial assets.
