The Indian stock market ended the first trading week of August 2025 on a volatile and bearish note, with global and domestic triggers pushing investors to take a risk-off approach. As the new derivatives series kicked off, the Sensex plunged by 586 points to close at 80,599.91, while the Nifty 50 declined 203 points to settle at 24,565.35.
This marks the fifth straight weekly decline as macroeconomic
headwinds ranging from trade tensions with the U.S., disappointing Q1 earnings,
and foreign institutional investor (FII) outflows continue to dampen investor
sentiment.
Let’s break down all the key triggers and understand what lies ahead for the Indian stock market.
Weekly Recap: Key Highlights
| Index | Close (Aug 1) | Weekly Movement |
|---|---|---|
| Sensex | 80,599.91 | -586 points (-0.72%) |
| Nifty 50 | 24,565.35 | -203 points (-0.82%) |
| BSE Midcap | — | -1.37% |
| BSE Smallcap | — | -1.59% |
Despite a strong intraday rebound on Thursday, the markets couldn’t hold
momentum. Selling pressure returned sharply on Friday amid fresh tariffs and
poor earnings numbers.
Key Market Triggers for the
Coming Week
1. RBI MPC Meeting (August 4–6)
The RBI
Monetary Policy Committee (MPC) meeting has been rescheduled to August 4–6, and all eyes are now on the
central bank's commentary around inflation,
growth, and liquidity.
While no rate change is expected, the tone and forward guidance could impact
market sentiment. With India’s CPI inflation hovering within the RBI's comfort
zone, a dovish tone could support a rebound in equities.
2. 🇮🇳🇺🇸
India-US Trade Tensions Escalate
In a surprise move, President Trump imposed a 25% reciprocal tariff on
Indian goods starting August 1. This reversed the favorable tariff structure
introduced in April.
| 📦 Country | Tariff on Key Exports |
|---|---|
| India | 25% |
| Vietnam | 20% |
| Indonesia | 19% |
| South Korea | 15% |
India is contemplating a digital tax
on tech giants like Amazon, Meta, and
Google in response. However, negotiations are still open, and both
sides remain committed to finalizing a bilateral
trade agreement.
3. Q1 Earnings Season Continues
More than 900 listed companies have released
their Q1 FY26 results. While sectors like FMCG and healthcare outperformed, IT, banking, and auto remained mixed.
Upcoming Q1 results to watch this week:
·
Bharti
Airtel
·
DLF
·
Tata
Motors
·
Hero
MotoCorp
·
LIC
·
SBI
4. IPO Activity to Stay Buzzing
Ten new IPOs are lined up for launch next
week:
·
2
Mainboard IPOs
·
8 SME IPOs
Additionally, 12 IPOs will debut on the stock exchange next week.
Analysts expect strong investor interest in consumer, defense, and tech-focused issues.
5. FII Selling Pressure
Foreign investors have been on a selling spree for 9 straight sessions,
withdrawing nearly ₹27,000 crore
from Indian equities. The reasons:
·
Disappointing Q1 earnings
·
25% U.S. tariffs
·
Strong U.S. dollar
This has heavily impacted midcaps, smallcaps, and export-oriented sectors.
| 🔄 Day | FII Outflows |
|---|---|
| Jul 22–Aug 1 | ₹27,000 crore |
Commodity Prices
Crude Oil
Oil prices dropped due to speculation that OPEC+ may raise output and signs of slowing U.S. labor market.
| Type | Price | % Change |
|---|---|---|
| Brent Crude | $69.67 | -2.83% |
| WTI Crude | $67.33 | -2.79% |
This decline offers relief to India,
a major importer, though any volatility remains tied to geopolitical shifts.
Gold
Gold prices surged nearly 2% amid:
·
Weaker-than-expected U.S. jobs report
·
Higher global trade tensions
·
Rate cut expectations
| Spot Gold | $3,347.66/oz | +1.8% |
Gold continues to be a safe-haven asset, attracting inflows amid equity volatility.
Technical View: What Charts Suggest
Nifty 50
·
Closed below 24,600, breaking a key support.
·
Next support: 24,400, then 24,180
(200 DEMA)
·
Resistance: 24,650, then 24,850–25,000
“Breach below 24,400 may accelerate the decline;
a rebound above 24,800 needed for short-term reversal.”
Bank Nifty
·
Support zone: 55,100–54,500
·
Resistance: 56,500, and major at 57,400
Despite strong performance from ICICI Bank and HDFC Bank, the index remains under pressure.
What Should Investors Do?
Strategies for August 2025:
·
Stay invested in non-discretionary sectors like FMCG and utilities.
·
Avoid aggressive buying in small- and mid-caps till FII flows
stabilize.
· Watch out for IPO listing gains especially in defense and tech.
Final Thoughts
August 2025 will be a make-or-break month for Indian equities. While
short-term risks from tariffs and FII outflows remain, positive commentary from the RBI, stable inflation, and strong
domestic demand could spark a reversal.
Keep a close eye on:
·
RBI MPC stance
·
India-US trade developments
·
Q1 earnings from market heavyweights
·
IPO listing performance
The volatility is likely to continue but so are the opportunities for long-term investors.
