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Below the Quote on Daily Market Commentary for August 5th 2026 by Siddhartha Khemka - Head of Research, Wealth Management, Motilal Oswal Financial Services Ltd

Indian equities are expected to trade with a positive bias, supported by Brent crude prices at lower levels (US$80.5/bbl), which is expected to improve the outlook for inflation and corporate margins. With the RBI maintaining its policy stance and with the ongoing Q1FY27 earnings season, stock-specific action is expected to remain the dominant market theme. Investors will also continue to monitor developments in West Asia after US President Donald Trump stated that the Strait of Hormuz would reopen soon while warning of a strong response if disruptions persist. Key companies scheduled to announce Q1FY27 earnings on Thursday include Trent, Siemens Energy India, Premier Energies, LIC, Samvardhana Motherson International, Lupin, Hero MotoCorp, Kirloskar Oil Engines, Fortis Healthcare, Britannia Industries and Apollo Tyres, among others. Domestic equities ended marginally higher, with the Nifty 50 ending flat to close at 24,624, as gains in Metals, Automobiles and Realty offset profit booking in select index heavyweights. Investor sentiment remained cautious amid lingering geopolitical uncertainty surrounding the Strait of Hormuz, although Brent crude oil prices near US$80.5/bbl continued to provide support to domestic markets. Broader markets outperformed, with the Nifty Midcap 100 and Nifty Smallcap 100 advancing 0.2% and 0.7%, respectively. Within consumption, the Quick Service Restaurant (QSR) sector appears to be approaching an earnings inflection point. A moderation in store additions compared with the aggressive expansion seen over the past few years is expected to improve unit economics, while stronger same-store sales growth, improving dine-in traffic and better operating leverage are likely to support margin expansion and a gradual earnings recovery across the sector. The RBI's Monetary Policy Committee (MPC) kept the repo rate unchanged at 5.5% for the fourth consecutive meeting and retained its 'neutral' policy stance, in line with expectations. The RBI increased its FY27 real GDP growth forecast to 6.7% (from 6.6%) and CPI inflation forecast at 5.1% (from 5%), while highlighting that heightened uncertainty arising from the prolonged West Asia conflict and rising global trade tensions warrants close monitoring of inflation and growth dynamics. RBI Governor reaffirmed the central bank's commitment to maintaining orderly movements in the rupee, with the domestic currency expected to strengthen further as global geopolitical tensions ease. Rate-sensitive sectors, particularly Realty, responded positively following the policy announcement. Overall, easing crude oil prices, supportive monetary policy, resilient domestic fundamentals and a healthy earnings season are expected to provide support to Indian equities, although developments in West Asia and global geopolitical risks will remain key near-term monitorable

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