Investor sentiment remains cautious amid lingering concerns over potential US tariff actions and the absence of major positive surprises from the Q1 FY25 earnings season.
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Indian markets are likely to open on a flat to negative note amid concerns about tariffs. The Gift Nifty at 24,670 indicates that the Nifty may slip by about 50 points at the open. With most companies having announced their Q1 FY25 results, the focus will shift to the upcoming RBI outcome.
Ajit Mishra, SVP, Research, Religare Broking Ltd., said: Lingering uncertainty over the tariff situation, following recent statements from the US President, along with a lack of major positive surprises from the earnings season, has been weighing on market sentiment. “All eyes are now on the outcome of the upcoming MPC meeting. While the committee is expected to hold rates steady amid global uncertainties, the tone of their commentary will be crucial. Amid this corrective phase, select stocks across sectors are showing noticeable strength and offering buying opportunities. Participants should therefore maintain a stock-specific approach and focus on prudent position sizing,” he said.
Mandar Bhojane, Senior Technical & Derivative Analyst, Choice Broking, said: Volatility declined slightly, as the India VIX fell 1.84 per cent to 11.71, indicating reduced fear and improved trader sentiment. In the options segment, the highest Call open interest is seen at the 24,800 and 25,000 strikes—signalling key resistance levels. Meanwhile, the highest Put open interest lies at the 24,600 strike, suggesting it to be an important support zone.
“The combined technical and derivatives setup suggests that as long as key support levels hold, there is a potential for upward continuation. Traders are advised to remain cautiously optimistic, use dips to accumulate quality names, and manage risk with appropriate stop-loss strategies,” he added.
Amid tariff threats, foreign portfolio investors are resorting to heavy selling.
Gaurav Garg, Lemonn Markets Desk, said: Foreign investors continued their selling streak, adding to the negative bias. Additionally, heavy profit-booking in oil and gas stocks dragged sectoral indices lower, while uncertainty ahead of the RBI’s policy decision on Wednesday kept traders cautious, he said.
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Published on August 6, 2025
