Stock market latest news: After a heavy beating on all four sessions last week, the key benchmark indices of the Indian stock market are witnessing strong buying for the last two straight sessions. The BSE Sensex has risen over 1,000 points this week, whereas the Nifty 50 index has added over 300 points in the last two successive sessions. As the three-day RBI MPC meeting began this Monday and the final outcome is due tomorrow, it is important to understand the reasons driving Indian stocks over the last two sessions.
According to stock market experts, there is buzz on Dalal Street that the RBI MPC meeting may come with a decision to keep the interest rate unchanged. Apart from this, Brent crude oil prices have slipped below $100 per barrel due to easing supply chain disruptions in the Middle East and short covering by FPIs, which are among the major factors fueling the Indian stock market.
RBI MPC meeting expectations
After positive US inflation and Non-Farm Payroll data, hopes are high that the US Fed may not hike interest rates at its October 2026 meeting. This may ease the pressure on the RBI, which is already at ease after the robust GDP data in the Q2FY27.
“After the easing in pressure on the US Fed after positive US inflation and the US Non Farm payroll data, expectations are high that the RBI MPC meeting may come out with a decision to keep the interest rates unchanged. The market is expecting this because there is no such inflation pressure in India, as we are witnessing in the US,” said Sandeep Pandey, Co-founder of Basav Capital.
Brent Crude oil price slips below $100/barrel
“The continuous rise in the Indian stock market ahead of the RBI MPC meeting outcome can be connected with the easing of crude oil prices. The Brent crude oil price has fallen below $100 barrel after the recent rally, which became possible after some Middle East countries started fresh crude oil supply,” said Sandeep Pandey of Basav Capital.
Anuj Gupta, a SEBI-registered market expert, believes the slide in crude oil prices may continue, as easing of tensions in the Middle East and fresh supply from Saudi Arabia and other Gulf countries are expected to cap any possible rebound in crude oil prices.
Short covering by FPIs
Decoding the FPI 150 index heatmap, Anuj Gupta said, more than 50% stocks listed in the FPI 150 index are trading green. Among these green stocks, most have gained a sizeable percentage from their previous close, suggesting FPIs are buying in the Indian stock market.
Decoding the FPIs’ buying, Sandeep Pandey of Basav Capital said, “FPIs had taken short positions during the heavy beating. Now, they are short-covering their position as the Indian market has fallen into the oversold zone. So, this short covering by the FPIs is also a major reason for the rally in the Indian stock market for the last two straight sessions.”
The Basav Capital expert also pointed towards the correction in the US bond yield as the US 10-year bond yield has corrected by over 0.50% on Tuesday.
Disclaimer: This story is for educational and informational purposes only. The views and recommendations above are those of individual analysts or broking companies, not Mint. We advise investors to check with certified financial experts before making any investment decisions.
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