with market participants yet to come into terms with the new Closing Auction System (CAS), that kicked in from August 3 to discover closing price equilibrium, participation from retail investors will be guarded, say analysts
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REUTERS/FRANCIS MASCARENHAS
Gift Nifty at 24,670 indicates stable opening of Indian markets despite Asian stock markets reeling under pressure. However, with market participants yet to come into terms with the new Closing Auction System (CAS), that kicked in from August 3 to discover closing price equilibrium, participation from retail investors will be guarded, said analysts. With the spot and futures prices vary significantly for both major indices and several stocks, experts believe participation from retail investors to remain low, as least in early hours. On macro front, the focus will be on RBI’s policy meet, the outcome of which will be known on Wednesday. Though the central bank is widely expected to keep the rates unchanged, market participants will closely monitor the pronouncements from the RBI team, especially on interest rates, inflation outlook and growth commentary.According to Ponmudi R, CEO of Enrich Money, a SEBI-registered online trading and wealth-tech firm, Indian equity markets are expected to trade on a steady note, with improving global sentiment and sustained institutional buying is likely to extend the recent recovery.“Investor confidence has been bolstered by signs of easing geopolitical tensions after U.S. President Donald Trump said negotiations with Iran remain underway, describing the current round of talks as the “last chance” to secure a deal. The comments have helped temper fears of a broader regional escalation, while WTI crude oil has stabilized near the $80-per-barrel mark after retreating sharply from its recent highs,” he said.Institutional flows continue to provide a supportive backdrop for domestic equities. Steady buying by Foreign Portfolio Investors (FPIs), alongside sustained inflows from Domestic Institutional Investors (DIIs), has reinforced the market’s constructive undertone, with investors now looking for fresh catalysts from global developments and domestic macroeconomic cues, he added.Key results Meanwhile, the Q1 FY27 earnings season gathers further momentum with several large-cap companies scheduled to announce their quarterly results, including Bharti Airtel, ONGC, Power Grid Corporation, Trent, Hindalco Industries, State Bank of India, and Titan Company.Management commentary on demand trends, margins, and future outlook will remain closely monitored and is likely to drive stock-specific action throughout the week.According to Hariselvan Radhakrishnan, Founder & CEO of HST Wealth, the geopolitical backdrop, however, remains fluid. President Donald Trump has paused further military action as diplomatic efforts gather momentum, while Iran has denied that direct negotiations with the U.S. are under way. Tehran’s discussions with Oman over the Strait of Hormuz have nevertheless raised hopes that shipping through the critical energy corridor could gradually normalise. The conflicting signals suggest that markets have reduced—but not eliminated—the geopolitical risk premium attached to crude oil.For Indian equities, the combination of lower crude prices and easing near-term geopolitical fears remains supportive, but much of that optimism was reflected in Monday’s rally. “Investors are therefore likely to adopt a more selective approach, with profit-taking at higher levels potentially limiting the upside. The near-term bias remains cautiously constructive, though the opening is expected to be flat to mildly weaker as markets await clearer diplomatic signals and the Reserve Bank of India’s policy decision on Wednesday,” he said.Published on August 4, 2026
