Indian stock markets could witness a sharp spike in volatility this week, as traders await a cocktail of market-moving events — from the Reserve Bank of India’s
(RBI) monetary policy to Q1 earnings from sector bellwethers, and escalating geopolitical tensions following US President Donald Trump’s surprise tariff escalation. Markets closed last week on a sour note, pressured by persistent FII selling and renewed trade fears. The Sensex declined 863.18 points or 1.05 per cent, while the Nifty lost 271.65 points or 1.09 per cent over the week. On Friday alone, the Sensex plunged 585.67 points to close at 80,599.91, and the Nifty dropped 203 points to settle at 24,565.35. “All eyes will be on the RBI’s monetary policy on August 6, particularly its commentary on inflation, liquidity, and the growth outlook,” said Ajit Mishra, SVP – Research, Religare Broking. Market focus is also set to intensify around earnings from heavyweights such as Bharti Airtel, DLF, Bajaj Auto, Hero MotoCorp, SBI, LIC, and Tata Motors, among others. The uncertainty is compounded by Trump’s abrupt announcement of a 25 per cent tariff on Indian exports, coupled with a penalty over India’s energy and defence trade ties with Russia. Analysts believe this move may worsen near-term investor sentiment and strain Indo-US relations, although some remain cautiously optimistic. “Despite the uncertainty, the broader sentiment suggests that India and the US may reach an agreement post-negotiations,” said VK Vijayakumar, Chief Investment Strategist, Geojit Financial Services. Apart from the RBI decision, key macro data such as HSBC’s services and composite PMI numbers, oil price trends, and rate moves by the Bank of England will also be closely tracked. “Heightened global and domestic volatility makes the upcoming RBI policy meet a key event,” said Pravesh Gour, Senior Technical Analyst, Swastika Investmart. “Results from Nifty majors like Adani Ports, Airtel, Titan, SBI and Tata Motors could also trigger sharp stock-specific moves,” he added. According to Siddhartha Khemka, Head of Research, Wealth Management, Motilal Oswal Financial Services, mixed Q1 earnings, weak global cues, and ongoing FII outflows are likely to keep markets range-bound in the near term. He added that services PMI prints from the US and India will be closely watched by global investors.
