Indian markets are likely to open higher as Nifty futures signal a 150-point gap-up. Analysts said focus shifted to the upcoming RBI meet and quarterly results. Shishir Baijal said, "We expect the RBI's MPC to maintain a cautious stance, with a potential 25 bps increase in the policy rate."
Indian equity markets are likely to open on a positive note after a long weekend, thanks to global cues. According to an analyst, focus has shifted to the upcoming RBI meet and quarterly results from India Inc., which will start trickling in later this week.
After central bankers in the US, Australia and the UK hiked rates, analysts expect the RBI to follow suit given higher inflation figures.
RBI policy in focus
Shishir Baijal, International Partner, Chairman and Managing Director, Knight Frank India, said: "Given the persistent inflationary pressures, elevated oil prices and concerns around a weaker monsoon, we expect the RBI's MPC to maintain a cautious stance, with a potential 25 bps increase in the policy rate. While higher rates could weigh on borrowing costs and near-term housing demand, the move would underscore the RBI's focus on anchoring inflation expectations and maintaining macroeconomic stability. For the real estate sector, the impact is likely to be measured, particularly as underlying demand remains resilient."
Meanwhile, Nifty futures at Gift Nifty are ruling at 22,660, signalling a gap-up open of about 150 points for Nifty.
Crude and bond yields temper optimism
According to Hariselvan Radhakrishnan, Founder - HST Wealth, Indian equities are likely to open with a gap-up after weaker U.S. employment data lowered the probability of another Federal Reserve rate increase in October to below 25%.
Elevated crude prices and global bond yields temper the relief from softer jobs data. Brent crude is trading near $102 a barrel after the seven OPEC+ countries overseeing voluntary production adjustments left November output unchanged. Meanwhile, the U.S. 10-year Treasury yield remains around 5.28%. The combination suggests that, while immediate Fed-hike concerns have eased, the yield advantage of dollar assets remains substantial enough to sustain pressure on foreign flows into Indian equities," he added.
Motilal Oswal flags key market factors
Motilal Oswal Financial, in a latest India strategy report, highlighted 12 key factors such as Indian market weakness continues; Russia and Brazil rebound from the Aug'26 lows; Market returns cool sharply, improving risk-reward and reversion potential; Rate hikes begin, pushing global bond yields to multi-year highs; Global bond yields surge to multi-decade highs; India's forex reserves soar to a record high amid strong FCNR inflows; SMIDs' share of Indian market cap reaches an all-time high; MSCI EM weights: India, China at multi-year lows; Taiwan, Korea at record highs; Broad-based sell-off; Media the lone gainer, while Technology and Financials lag; Elevated commodity prices pose an extended margin risk; IRDAI's 2026 reforms: Reshaping the economics of insurance distribution; DII buying strengthens as FII selling resurfaces; and Nifty's valuations ebb to May'20 levels.
Meanwhile, after a sharp record close in US markets on Friday, Asian stocks are up between 0.3 per cent and 2.5 per cent.