Domestic markets are expected to open on a firm note despite CAS-induced closing price confusion that triggered huge variance for the closing price. Gift Nifty at 24,729 indicates a sharp gap-up opening for the markets. The focus will be on RBI monetary policy outcome.Ponmudi R, CEO of Enrich Money, said, Indian equity markets are poised for a firm start, with improving global risk sentiment underpinning investor confidence after renewed optimism over a potential US-Iran agreement raised expectations that shipping through the Strait of Hormuz could gradually normalise. The prospect of easing geopolitical tensions has driven a sharp decline in crude oil prices, with WTI crude falling to a fresh low near $74 a barrel before stabilising around the $75 mark. Reflecting the improvement in sentiment, GIFT Nifty futures are trading above the 24,700 level in early trade, comfortably above the Nifty’s previous close of 24,614, pointing to a positive opening for domestic equities. Asian markets are trading sharply higher, adding to the improving risk appetite across global equities. Japan’s Nikkei 225 has advanced more than 3%, while South Korea’s Kospi has surged over 4%, reflecting broad-based optimism as easing geopolitical tensions and lower crude oil prices continue to support regional markets,” he added.Dr. Manoranjan Sharma, Chief Economist, Infomerics Valuation, said the RBI is likely to hold the repo rate at 5.25% and retain a neutral stance, with the pause aimed at preserving policy flexibility rather than signalling policy inertia. However, according to him, inflation has emerged as the key concern, with CPI inflation rising to 4.38% in June 2026, food inflation at 5.32% and WPI inflation reaching 9.87%, indicating significant upstream cost pressures. • Liquidity management is expected to remain central to the RBI’s policy approach, with calibrated interventions needed to balance excess liquidity against unnecessarily tight financial conditions and ensure effective monetary transmission, he said.However, market participants are yet to cope with the wild swings induced by the closing auction session. Hitesh Rathi, Technical Analyst -Equity & Derivatives, Angel One, said the first weekly expiry following the introduction of the new CAS-based closing price determination system commenced on a highly uncertain note. After the previous session’s unusually strong close, where prices witnessed a sharp spike during the closing auction, the session with a gap-down. “Prices largely drifted lower throughout the session, as the market appeared to adjust for the previous day’s closing-auction spike. However, a sharp surge once again emerged during the closing auction, resulting in the index recouping almost all of its intraday losses.”While the recent decline in crude oil prices reflects growing optimism over a potential normalisation of shipping through the Strait of Hormuz, investors are likely to remain cautious until there is greater clarity on the evolving geopolitical situation. Against this backdrop, attention is firmly focused on the Reserve Bank of India’s Monetary Policy Committee (MPC) decision due this morning. Market participants will closely assess the central bank’s commentary on inflation, liquidity conditions, economic growth, and the broader policy outlook for clues on the future path of interest rates. The policy guidance is expected to be especially significant for banking and other interest rate-sensitive sectors. Foreign Institutional Investors (FIIs) extended their buying streak for a sixth consecutive session, with sustained participation from Domestic Institutional Investors (DIIs) further reinforcing the market’s constructive undertone and providing an additional cushion to the ongoing recovery.Meanwhile, India VIX edged higher to 12.19, suggesting a marginal pickup in volatility while remaining at relatively comfortable levels. “Option chain data continues to indicate a positive undertone, with maximum Put Open Interest concentrated at the 24,500 strike, followed by 24,300, reinforcing immediate support through aggressive Put writing. On the upside, maximum Call Open Interest is positioned at the 24,600 strike, followed by 25,000, highlighting the immediate resistance zone where Call writers remain active. The Put-Call Ratio (PCR) stands at 0.82, reflecting a mildly cautious derivatives setup following the recent profit booking,” said Dhupesh Dhameja, Derivatives Research Analyst, SAMCO SecuritiesPublished on August 5, 2026