Indian equity benchmarks ended the week with mixed performance, with the Nifty 50 rising 0.76% to close at 24,570 while the Sensex gained 0.51% to settle at 78,499. According to The Times of India, markets ended the week with modest gains despite heightened volatility, as investors navigated the roll-out of the new Closing Auction Session (CAS) framework for F&O stocks, the Reserve Bank of India's monetary policy decision, and lingering geopolitical uncertainties. As per The Hindu BusinessLine, markets ended the week with modest gains despite heightened volatility, as investors navigated the roll-out of the new Closing Auction Session (CAS) framework for F&O stocks, the Reserve Bank of India's monetary policy decision, and lingering geopolitical uncertainties. As per Business Standard, the newly launched closing auction session continued to create unusual volatility and divergence between the benchmark indices. Last week, the BSE benchmark Sensex climbed 404.53 points, or 0.51 per cent, and the NSE Nifty went up by 187.05 points, or 0.76 per cent, demonstrating continued resilience in the face of multiple market pressures.
Crude oil prices have shown significant volatility amid ongoing Middle East geopolitical tensions, creating uncertainty for Indian markets. As reported by The Economic Times, after dropping in the first three sessions, crude oil prices rose on Thursday and Friday amid continued uncertainty over negotiations aimed at determining control of the Strait of Hormuz and reopening the key shipping artery. JPMorgan estimates that every additional month of disruption could push Brent crude higher by about $7 to $8 a barrel, with the bank expecting average monthly Brent prices to reach around $114 a barrel if disruptions continue for three months. Goldman Sachs has warned that Brent could climb to $120 a barrel if shipping disruptions through the Strait of Hormuz persist. The trajectory of oil prices will largely depend on the duration of supply disruptions, with the Strait of Hormuz being the world's most important oil transit route. Meanwhile, OPEC+ approved a production-target increase of 1.88 lakh barrels per day for September, completing the rollback of its 2023 voluntary cut, though actual supply remains constrained by Middle East and Ukraine-related disruptions. However, expectations of renewed diplomatic engagement between the US and Iran, coupled with efforts to stabilize the Strait of Hormuz, eased fears of prolonged supply disruptions. As a major oil-importing nation, India stands to benefit considerably from softer crude prices through lower inflationary pressures, improved corporate margins, and a more stable external account.
The Q1 earnings season is set to intensify significantly, with over 2,045 companies scheduled to announce their June quarter earnings between Monday and Friday, August 14. According to The Hindu BusinessLine, corporate earnings are projected to grow around 10%, marking the strongest expansion in four quarters. The June quarter earnings season, which kicked off on July 9 with Tata Consultancy Services reporting its results, is expected to gather pace this week. Key stocks like Tata Motors, HAL, and Vodafone Idea will be keenly watched by investors. As per The Times of India, the Q1 FY27 earnings season will gather further momentum, with several companies including HAL, Bharat Forge, Grasim Industries, and Tata Motors scheduled to announce their quarterly results. As per The Hindu BusinessLine, Ajit Mishra from Religare Broking expects the Q1 FY27 earnings season to gather further momentum, with several companies including HAL, Bharat Forge, Grasim Industries, and Tata Motors scheduled to announce their quarterly results. Q1FY27 results have generally exceeded expectations, with small-cap companies emerging as the strongest performers relative to large- and mid-cap peers. Sectoral leadership came from IT as a value buy, autos and consumer durables supported by volume growth guidance, and banks backed by lending growth and below-average valuations. Goldman Sachs sees the Nifty 50 rebounding to 26,500, a level above its record high of 26,373, as it turns more constructive on India following an improvement in the recent macro backdrop.
The Reserve Bank of India delivered a constructive policy outcome that reinforced market confidence. The RBI's MPC maintained the repo rate at 5.25% and retained its neutral policy stance, largely in line with market expectations. More importantly, the central bank delivered a constructive assessment of the domestic economy by marginally upgrading its FY27 GDP growth forecast to 6.7% from 6.6%, while lowering its FY27 inflation forecast to 5.0% from 5.1%. This reflected confidence in the resilience of domestic demand despite global uncertainties. Compared with the previous policy review, the latest RBI communication was incrementally more optimistic. While maintaining a data-dependent approach, the central bank acknowledged stronger economic momentum and a better inflation trajectory. The revised projections also suggest that growth is holding up better than previously anticipated, while inflation pressures, although still present, are becoming more manageable. The market interpreted this combination of lower crude prices, easing inflation concerns, and an improved growth outlook as supportive for corporate earnings. Realty and auto stocks are expected to benefit from festive demand and favourable financing conditions, while energy and heavyweight stocks are attracting buying interest as investors position themselves for potential margin improvements in a lower-oil-price environment.
Foreign Institutional Investors maintained their buying momentum for the second consecutive week, with FIIs remaining net buyers in the cash market, purchasing equities worth ₹2,887 crore so far in August 2026. According to The Hindu BusinessLine, Foreign Portfolio Investors (FPIs) maintained their buying spree in Indian equities, investing ₹12,921 crore in the first week of August, demonstrating continued foreign investor confidence in Indian markets. After months of caution, FIIs returned to India as the excessive AI-led rally began to bring greater parity to the performance of non-AI markets, with investors showing renewed interest in portfolio diversification. As per The Times of India, the buying comes after Indian benchmark indices closed the previous week with gains, with the BSE benchmark Sensex advancing 404.53 points, or 0.51 per cent, while the NSE Nifty gained 187.05 points, or 0.76 per cent. As per Business Standard, Domestic Institutional Investors (DIIs) also sustained their buying momentum, with DIIs recording net purchases of ₹7,768 crore, with inflows seen in four of the five trading sessions. The sustained buying by both FIIs and DIIs was largely driven by the de-escalation of geopolitical tensions, which boosted investor confidence and supported market sentiment. However, elevated U.S. bond yields are among the concerns that continue to weigh on the market, raising questions about the durability of capital flows into emerging markets.
This week will be crucial for Indian markets as they navigate multiple domestic and global economic catalysts. According to The Hindu BusinessLine, investors will closely monitor the July CPI inflation print, WPI inflation, and the latest foreign exchange reserves data for fresh insights into inflation trends and external sector stability. As per The Times of India, Ajit Mishra from Religare Broking expects the week will also be important from a macroeconomic perspective, with India scheduled to release CPI inflation on August 12 and WPI inflation on August 14. In the US, CPI and PPI (Producer Price Index) data will be released on August 12 and 13, respectively. As per The Hindu BusinessLine, the week will also be important from a macroeconomic perspective, with India scheduled to release CPI inflation on August 12 and WPI inflation on August 14. The closing auction session remained the key highlight of the last week, as it was the first week of the new system, with 68% of NIFTY50 stocks trading above their 50-day moving average, increasing from 62% in the previous week. The market started with higher-than-usual volatility due to the implementation of the new F&O closing price system, CAS, but the system has since stabilized and is likely to become more effective as volumes normalize. While geopolitical risks and global yield movements remain important variables, the market increasingly appears focused on India's strengthening economic fundamentals and improving growth-inflation balance, laying the groundwork for sustained investor optimism.
