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Indian markets are poised for a positive start on Monday, buoyed by the Reserve Bank of India’s surprise 50 bps repo rate and 100 bps CRR cut, signalling policy support.
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Markets are likely to open in a positive zone on Monday amid a strong undercurrent in favour of bulls. After the Reserve Bank of India surprised the markets with a 50 bps repo rate cut with a 100 bp CRR cut,
Gift Nifty at 25170 signals a gain of about 70 points at open. However, due to a sharp run-up in the share price, analysts expect the market to see some profit booking as the day progresses.
According to SBI Securities, as the earning season is now behind, global cues along with domestic economic data flow (CPI and trade balance data) are likely to catalyse the market. “Monsoon in 2025 made the earliest onset in 16 years and hence further progress and spread will be keenly watched,” it said, adding that Street is likely to remain constructive on rate sensitives like NBFCs, Banks (U shape margin trajectory with likely dip in 1QFY26 followed by strong exit during FY26 end), Real Estate, Auto, Consumption (especially credit linked), AMC’s (reduction in EMI burden may aid further inflows in MFs) etc.
Ajit Mishra, SVP, Religare Broking, said: High-frequency indicators such as CPI inflation will be closely tracked to gauge demand trends and the central bank’s next steps. “Additionally, the progress of the monsoon and sowing patterns will be monitored due to their implications for rural consumption, “On the global front, developments in trade negotiations and movements in U.S. bond yields will continue to influence investor sentiment,” he said.
Equities across the Asia Pacific region are up early on Monday.
Meanwhile, F&O data also present a bullish outlook for the stock market. Options data reinforces bullish undertones, with aggressive put writing observed at near-the-money strikes.
“ The Put-Call Ratio (PCR) has climbed from 0.79 to 0.97, indicating a marked reduction in bearish bets and a growing bullish bias. Max Pain stands at 24,900, suggesting that participants expect the index to expire near current levels, said Dhupesh Dhameja, Derivatives Research Analyst, SAMCO Securities. “India VIX cooled significantly during the week, dropping nearly 9% to 14.63, down by 3.00%. This moderation in volatility suggests declining market anxiety and is typically a precursor to a continued uptrend, signalling increasing investor confidence,” he added.
Foreign portfolio flows are likely to be sustained, said analysts.
Last week, the offshore investor fraternity adopted a vigilant approach while investing in the Indian capital market. The Central Bank and the market regulator are leaving no stone unturned to bring the foreign market participants at ease while they view India as one of the preferred jurisdictions to invest from a long-term perspective, said Manoj Purohit, Partner & Leader, Financial Services Tax, Tax & Regulatory Services, BDO India
Recently, the SEBI extended the implementation deadline by six months for key disclosure norms concerning ODIs and FPIs with segregated portfolios to provide additional time for smooth implementation. Also, the recent reduction of the repo rate by 50 basis points by the Central Bank and the recent steps to remove short-term investment and concentration limits for investments by FPIs in corporate debt securities are welcomed. “Currently, the regulations permit investments by any FPI, including investments by related FPIs, upto 50% of any issue of a corporate debt security. This move will surely provide much needed liquidity and penetration to the bond market and enhance the attractiveness of Indian – fixed-income instruments to overseas investors,” he added.
Published on June 9, 2025
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