The Indian stock market is expected to open on a tepid note on Wednesday, following mixed global market cues and cautiousness ahead of the Reserve Bank of India's (RBI) monetary policy.
The trends on Gift Nifty also signal a negative start for the Indian benchmark indices, Nifty 50 and Sensex, today. The Gift Nifty was trading around 22,741 level, a discount of nearly 54 points from the Nifty futures' previous close.
However, volatility is expected to remain elevated as the RBI is widely expected to deliver a hawkish monetary policy, with a hike in interest rates, amid higher inflation concerns.
“With the broader market structure remaining cautious amid elevated global macro risks, volatility is likely to stay high, favouring a selective, stock-specific approach as opportunities emerge,” said Ajit Mishra, SVP – research, Religare Broking.
Here are five key factors that may drive the Indian stock market today:
Asian Markets
Asian markets traded mixed on Wednesday. Japan's Nikkei 225 eased 0.12%, while the Topix rose 0.12%. South Korea's Kospi gained 0.44% and the Kosdaq slipped 1.21%. Hong Kong's Hang Seng index futures indicated a flat opening. Mainland China markets remain closed for a holiday.
Wall Street
US stock market ended higher on Tuesday, with the S&P 500 and Nasdaq posting all-time closing highs, supported by steady crude oil prices and easing Treasury yields.
The Dow Jones Industrial Average gained 253.14 points, or 0.49%, to 51,521.04, while the S&P 500 rallied 45.00 points, or 0.58%, to 7,818.95. The Nasdaq Composite closed 122.48 points, or 0.45%, higher at 27,599.79.
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RBI Policy
The Reserve Bank of India (RBI) will announce its fourth bi-monthly monetary policy for FY27 today. Analysts expect the RBI Governor Sanjay Malhotra-led Monetary Policy Committee (MPC) to raise the benchmark repo rate by 25 basis points to 5.50% from 5.25%, where it has remained for nearly 10 months. However, Street is divided on the stance.
US Trade Deficit
The US trade deficit widened sharply in August to the largest since early 2025. The gap in goods and services trade grew 13.7% from the prior month to $105.6 billion.
Gold Rate Today
Gold prices held gains amid a decline in bond yields eased pressure on the US Federal Reserve to hike interest rates this month. Spot gold price was flat at $4,167.05 an ounce, while silver price was steady at $61.34.
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