Equity markets this week will turn their focus on the RBI's interest rate decision, Q1 earnings from several blue-chip firms and tariff-related news for further cues, analysts said.
Moreover, trading activity of foreign investors and trends in global equity markets will also drive investors' sentiment.
"At the domestic level, all eyes will be on the Reserve Bank of India's monetary policy meeting, where the central bank's commentary on inflation, liquidity, and growth outlook will be keenly watched. On the earnings front, results from marquee companies, including Bharti Airtel, DLF, Bajaj Auto, Hero MotoCorp, Tata Motors, State Bank of India and Life Insurance Corporation of India, will shape sectoral momentum," Ajit Mishra – SVP, Research, Religare Broking Ltd, said.
Other important triggers include the release of HSBC services and composite PMI, crude oil price movement, and further commentary from the US on trade negotiations -- all of which are likely to influence near-term volatility, Mishra added.
Trade-related concerns and persistent selling by foreign investors added to the gloom in the markets last week.
Pravesh Gour, Senior Technical Analyst at Swastika Investmart Ltd, said, "Looking ahead, the RBI policy meeting scheduled for August 6 will be a key event, especially amid heightened volatility from both global and domestic triggers.
"Meanwhile, several major Nifty companies, including Adani Ports, Bharti Airtel, Bajaj Auto, Hero MotoCorp, Trent, Titan, State Bank of India and Tata Motors, are set to report their earnings this week, which could drive stock-specific action".
Last week, the BSE benchmark Sensex tanked 863.18 points or 1.05%, and the NSE Nifty dropped 271.65 points or 1.09%.
US President Donald Trump’s decision to impose a 25% tariff on Indian goods and an unspecified penalty for trade in energy and defence goods with Russia was unexpected, and therefore, it has impacted market sentiments in the short term, VK Vijayakumar, Chief Investment Strategist, Geojit Investments Limited, said.
Indian equities are expected to remain in consolidation mode amid the imposition of US tariffs, a mixed Q1 FY26 earnings season so far, and intensifying FII outflows, Siddhartha Khemka - Head of Research, Wealth Management, Motilal Oswal Financial Services Ltd, said.
"On the macro front, important data to watch include the RBI and Bank of England’s interest rate decisions, along with the services PMI for both the US and India," he added.
On Friday, the Sensex tumbled 585.67 points or 0.72% to settle at 80,599.91, and the Nifty declined 203 points or 0.82% to 24,565.35.
Market perception is that after the initial chaos, there will be a deal between India and the US after the next round of negotiations. A steady trend of FPI flows will emerge after the dust settles, Vijayakumar said.
