EQUITY RESEARCH (08th Aug 2026)

Nifty extended its gaining streak for the second consecutive trading week and settled with a gain of 0.77% at the mark of 24,570.65. Nifty couldn’t sustain the momentum as investors remained cautious and volatility in the market increased amid rollout of SEBI’s new mechanism of closing the auction session. RBI’s monetary policy that kept the interest rate unchanged at 5.25% also disappointed the investors, but the only silver lining was the growth projection which was revised higher to 6.7%, while inflation was projected lower at 5% for FY27. The market is also eyeing on the easing geopolitical tension that has helped in reduction of oil prices to near $80, warning off inflationary pressure, supporting the index upside. But investors are yet eyeing on how the closing auction mechanism will impact on the liquidity in the market along price discovery.

RBI Monetary Policy

RBI in its latest monetary policy concluded on 5th August, kept REPO rate unchanged at 5.25%, maintaining standing deposit facility rate at 5% and Bank rate at 5.5%. On the economic growth projection, RBI revised FY27 growth projection higher to 6.7%, making India the fastest growing economy in this geopolitical crisis as well.  Further inflation was also reduced to 55 from earlier projector 5.1% for FY27.Central bank maintained a cautious approach, but it also stated that it will keep eye on economic data, and will stay focused on aligning the inflation, while supporting the economic growth.

Indian Economy and INR Performance

Economic growth in India’s private sector decelerated. The Business Activity Index dropped from June’s 57.4 to 53.3 in July. Concurrently, the HSBC India Composite PMI Output Index dipped to 54.3 from 57.1, indicating the weakest private-sector gains since 2022. Despite these slower growth rates, both metrics remained above the crucial 50-point mark, meaning the economy is still expanding and not shrinking. Furthermore, overall business sentiment stayed upbeat, even though optimism cooled to its lowest point in seven months.

INR continued to strengthen for the second consecutive week and touched the mark of ₹94.92, however, it closed the week little higher at ₹95.1980. If INR falls below the mark of ₹94.92, then INR can further strengthen to ₹94.77, however if it reaches above the mark of ₹95.37, the it may weaken to 95.61

For the week ahead

Domestically, the index would get a direction, taking cues from the performance of INR along with FII’s, which continued to remain sellers. Further investors would take cue from Middle east tension along with prices of the crude oil. Further WPI numbers would also be released on 14th august and retail inflation on 12th August, would give further insight about the Indian economy.

NIFTY WEEKLY

Nifty 50 traded with mixed  momentum and the index managed to  stay above its crucial resistance of 24,560, The index managed to touch the weekly high of 24,774.30. RSI also inched higher to 54.18, indicating room for upside in the index. It is trading below  the highest band of the bollinger band at 24,836. If it manages to stay above 24,750 and breaches the mark of  24,840, then 25,000 would be the next upside destination. Only falling below the mark of 24,430, would weigh heavily on nifty for 24,250.

BANK NIFTY WEEKLY

Bank Nifty traded with positive  momentum and index went to touch the weekly high of 58,247.95, but failed to break the resistance of 58,200. Banking index has formed a base at the level of 57,350, where index has formed a double bottom, from where index has rebounded. Further, with RSI pointing upward to the  mark of 54.32 from previous week’s number of 52.45, is hinting strength in the index which may further push the index towards the level of 58,690. Thus for the index to further upside the index must pull itself  above the mark of 58,200 then must reach for the next upside destination of 58,700 level. However, if the index breaks the weekly low of 57,352, then we may see the index slipping to the level of 56,640.

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