Sensex Gains After RBI Policy, Nifty Flat as Auto and Realty Stocks Lead Broader Market Rally

Indian equities traded with a positive bias on Wednesday, August 5, although the benchmark indices showed a noticeable divergence following the RBI policy announcement. Around 11:30 am, the BSE Sensex was trading near 78,720, higher by around 290 points or 0.37 per cent. The Nifty 50, however, was almost unchanged at 24,621, up about 7 points or 0.03 per cent. The RBI kept the repo rate unchanged at 5.25 per cent while maintaining a neutral policy stance.

The broader market displayed much stronger momentum than the headline Nifty suggested. The Nifty Midcap index gained around 0.4 per cent, while the Nifty Smallcap index advanced about 0.8 per cent, with both broader indices touching fresh record highs during the session. Banking stocks remained relatively subdued, leaving the Nifty Bank largely flat. Market breadth was firmly positive, with 1,935 stocks advancing against 488 declines on the NSE earlier in the session.

Sectorally, buying was concentrated in rate-sensitive and domestic-facing pockets. Nifty Realty jumped around 2.4 per cent, emerging as the strongest sectoral performer, while Nifty Auto gained about 1.5 per cent. Lower crude oil prices also provided support to auto and other oil-sensitive businesses. On the other hand, FMCG, Financial Services and Private Bank indices slipped into the red as investors booked profits in select heavyweight counters.

Stock-specific action remained quite strong. Manipal Health Enterprises surged 10.5 per cent on its stock market debut following its USD 960 million IPO. APL Apollo Tubes climbed around 4 per cent to Rs 1,920 after quarterly revenue beat estimates by 8.4 per cent.

Bharti Airtel gained around 1 to 2 per cent after reporting a 37 per cent year-on-year rise in Q1 net profit to Rs 8,167 crore, while revenue increased 18 per cent to Rs 58,539 crore. In contrast, Nykaa fell around 3 per cent despite consolidated net profit more than tripling to Rs 80 crore and revenue rising 29 per cent year-on-year.

Institutional flows have also turned supportive. In the latest completed session on August 4, FIIs were net buyers of Indian equities worth Rs 2,446 crore, extending their recent buying streak. DIIs, however, booked profits and were net sellers worth Rs 936 crore.

Global cues remained favourable. Overnight, the S&P 500 gained around 2 per cent while the Nasdaq jumped nearly 3 per cent. Asian equities followed, with South Korea's Kospi rising more than 4 per cent and Japan's Nikkei gaining over 3 per cent. Brent crude slipped around 1.2 per cent to USD 78.43 per barrel amid hopes of progress towards a US-Iran agreement and reopening of the Strait of Hormuz.

For the remainder of the session, 24,530 remains an important near-term level for the Nifty, while the 24,775 zone could act as immediate resistance. Investors will also track Q1 earnings, crude oil movements and the market's assesSMEnt of the RBI's revised 6.7 per cent FY27 growth forecast. The broader market remains constructive, but stock-specific volatility could stay elevated during earnings season.

This market update is intended to provide perspective on the day's trading action rather than suggest any specific investment or trading strategy.

Disclaimer: The article is for informational purposes only and not investment advice.