Indian Equities Poised for Positive Start as Crude Oil Prices Ease Ahead of RBI Policy Decision
Investors eye RBI's Monetary Policy Committee meeting outcome and ongoing Q1 earnings for market direction this week.
The story
Indian equity benchmarks extended their winning streak for a third consecutive session on Friday, July 31. The BSE Sensex advanced 166.49 points, or 0.21%, to settle at 78,094.64, while the NSE Nifty 50 gained 66.45 points, or 0.27%, to finish at 24,383.60. [5, 24]
This positive momentum was supported by renewed buying interest from both foreign and domestic institutional investors. Foreign Institutional Investors (FIIs) were net buyers, purchasing shares worth ₹277.48 crore on Friday, July 31, while Domestic Institutional Investors (DIIs) bought ₹2,260.37 crore. [13, 24, 28, 31, 32] Global cues also played a role, with easing crude oil prices boosting sentiment after reports of US President Donald Trump cancelling a planned attack on Iran. Brent crude fell almost 5% to $84.12 per barrel, and West Texas Intermediate (WTI) crude slipped 4.72% to $80.67 per barrel. [13, 24, 25]
Looking ahead, Indian markets are expected to open with a gap-up on Monday, August 3, as indicated by GIFT Nifty futures surging 180 points, or 0.74%, to 24,628. [24] This week, the Reserve Bank of India's Monetary Policy Committee (MPC) meeting, scheduled from August 3 to 5, is the key domestic event, with its decision due on August 5. [2, 3, 8, 15, 25] Additionally, Q1 FY27 earnings from several large companies will continue to influence stock-specific movements. [3, 4, 8, 9, 15, 25]
The tape
| Instrument | Last | Change |
|---|---|---|
| Nifty 50 | 24,383.60 | +66.45 (0.27%) |
| Sensex | 78,094.64 | +166.49 (0.21%) |
| India VIX | 11.76 | -0.39 (-3.2%) |
Flows & data
| Item | Reading | Read |
|---|---|---|
| FII Net Flows | +₹277.48 Cr (July 31, 2026) | Foreign institutional investors were net buyers in the cash segment. |
| DII Net Flows | +₹2,260.37 Cr (July 31, 2026) | Domestic institutional investors were net buyers in the cash segment. |
| July GST Collections | ₹2.1 L Cr (July 2026) | Goods and Services Tax collections increased by 15.4% year-on-year. |
| July UPI Transactions | ₹29.88 L Cr (July 2026) | Unified Payments Interface recorded its highest-ever transaction value. |
IPOs & the primary market
India's primary market saw varied activity, with the MV Electrosystems IPO closing on August 2, having been subscribed 12.03 times, and its Grey Market Premium (GMP) reportedly jumping. [14, 21, 27] The Juniper Green Energy IPO, which opened on July 30, is set to close today, August 3, and was subscribed 1.27 times as of August 3. [14, 21, 27] Meanwhile, Advance Technoforge, an SME issue, made a muted debut on the bourses today. [14] Looking ahead, Anawil Wire & Engineering's IPO opened on August 2 and will close on August 4. [14, 19, 21] Several new issues are slated to open this week, including Ardee Industries (August 5-7), Aegeus Technologies (August 4-6), and LAPL Automotive (August 6-10). [16, 19, 21] The broader sentiment indicates a cooling in India's IPO boom, with overall proceeds down from a year earlier as companies adjust deal sizes and valuations. [36]
Valuation watch — India & global
While specific Nifty PE ratios for the current week were not readily available, market sentiment suggests Indian equities were perceived as 'probably oversold' in recent weeks, contributing to foreign institutional investor (FII) inflows in July. [3, 8] However, a broader trend indicates a cooling in India's Initial Public Offering (IPO) boom, with overall proceeds down by a fifth from the previous year. This suggests that the primary market is experiencing some moderation, with companies reportedly cutting deal sizes and accepting lower valuations. [36] This shift could be a signal of reduced froth in certain segments, as issuers adapt to evolving market conditions rather than the exuberance seen previously.
Monsoon watch
India's southwest monsoon showed improvement in July, with cumulative rainfall across the country at 99% of the Long Period Average (LPA) for the month. However, the overall cumulative rainfall as of August 1 remained 12% below the LPA, an improvement from a 24% deficit in mid-July. [10] The distribution of rainfall has been uneven, with Central India recording a 6% surplus, while North and West India faced a 12% deficit, the Southern Peninsula was 22% below normal, and East and North-East India saw a significant 29% deficit. [10] This unevenness has impacted kharif sowing, which stood at 89.4 million hectares as of July 31, nearly 3% lower than the same period last year. [10] The India Meteorological Department (IMD) forecasts below-normal rainfall for August-September, projecting it at 94% of the LPA. [12]
What we'll be watching
- Reserve Bank of India's Monetary Policy Committee meeting outcome on August 5.
- Ongoing Q1 FY27 corporate earnings season, with results from DLF, IREDA, Bharti Airtel, and SBI.
- Release of India's Manufacturing and Services Purchasing Managers' Index (PMI) data this week.
- India's foreign exchange reserves data to be released on August 7.
- IPO openings for Ardee Industries (August 5-7) and Aegeus Technologies (August 4-6).
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