Key indices end in green amid easing geopolitical tensions

Indian equity benchmarks closed in green in a volatile session on Thursday as hopes for a U.S.-Iran deal to reopen the Strait of Hormuz along with a better-than-expected June-quarter earnings season helped underpin sentiment. However, the newly-launched closing auction session (CAS) continued to create divergence in benchmark indices. 

The BSE Sensex ended the weekly F&O expiry session up by around half percent, as buying in sectors such as energy, capital goods and PSU stocks helped the Sensex outperform the Nifty. Reliance Industries was among the biggest contributors to the Sensex rally, while selling in Realty and Utilities stocks limited the broader market's gains.  

The Nifty 50 traded in a narrow range throughout the session and ended with modest gains, supported by buying in index heavyweights. However, the upside remained limited as data from the NSE showed foreign institutional investors (FIIs) turned net sellers in Indian equities, offloading shares worth Rs 943.42 crore on August 5, 2026.

Some of the important factors in trade: 

Manufacturing firms’ optimism on demand conditions weakens in Q1: The Reserve Bank of India (RBI) in its latest report has stated that manufacturing firms turned less optimistic about demand conditions during the first quarter of FY27, with sentiments on production, order books, capacity utilisation and exports weakening amid the ongoing conflict in West Asia.

Rural economy, agriculture sector gain resilience over years: Reserve Bank of India (RBI) Governor Sanjay Malhotra has said that the rural economy and the agriculture sector have become more resilient over the years, supported by the growth of allied activities, expanded irrigation, greater farm mechanisation, and improved crop varieties. 

Jaishankar calls Africa key partner and priority for India: External Affairs Minister S Jaishankar has said that Africa is a key partner and a priority for India. He asserted that the continent must be given its due place whether one speaks of a multipolar world order or of a reformed multilateralism. 

India's non-fossil fuel power capacity crosses 300 GW: Union minister Pralhad Joshi has said India's non-fossil fuel electricity generation capacity has already crossed the 300 GW mark and the nation is on track to achieve its target of having 500 GW of renewable energy by 2030.

Insurance sector’s stocks remain in watch: S&P Global Ratings India's insurance sector is poised for 'massive' long-term growth, supported by structural reforms, low insurance penetration, and a favourable regulatory environment, but macroeconomic headwinds and profitability pressures remain key risks.

Global front: European markets were trading higher buoyed by easing geopolitical tensions and strong corporate earnings sentiment. Asian markets closed mostly lower as chip stocks faced selling pressure following a sharp pullback in U.S. semiconductor and technology stocks overnight. 

Finally, the BSE Sensex rose 373.76 points or 0.48% to 78,954.76 and the CNX Nifty was up by 11.35 points or 0.05% to 24,636.00.     

The BSE Sensex touched high and low of 78,954.76 and 78,633.73, respectively. There were 14 stocks advancing against 16 stocks declining on the index.        

The top gaining sectoral indices on the BSE were Capital Goods up by 1.29%, Energy up by 1.14%, PSU up by 1.09%, Bankex up by 0.86% and Industrials up by 0.83%, while Realty down by 1.42%, Utilities down by 1.02%, Telecom down by 0.82%, Metal down by 0.79% and IT down by 0.72% were the top losing indices on BSE.

The top gainers on the Sensex were Reliance Industries up by 3.43%, State Bank of India up by 3.02%, Bharat Electronics up by 2.56%, ICICI Bank up by 2.28% and Eternal up by 1.99%. On the flip side, Power Grid down by 3.99%, TCS down by 2.06%, Interglobe Aviation down by 1.49%, Mahindra & Mahindra down by 1.41% and Maruti Suzuki India down by 1.15% were the top losers.

Meanwhile, Reserve Bank of India (RBI) Governor Sanjay Malhotra has said that the rural economy and the agriculture sector have become more resilient over the years, supported by the growth of allied activities, expanded irrigation, greater farm mechanisation, and improved crop varieties. These developments have reduced the impact of rainfall deficiencies on agricultural output. He added that allied activities have also helped rural households cushion income losses during periods of agricultural stress.

RBI Deputy Governor Poonam Gupta has said that data from the past 15 years show the resilience of the rural economy has strengthened in multiple ways. She said 'We have seen that the overall economy has become very resilient, and that resilience extends to different sectors, particularly the agriculture sector and the rural economy'.

Gupta noted that agriculture and allied sectors have increasingly complemented each other, while the expansion of irrigated land has made agriculture less vulnerable to rainfall deficiencies. She said 'If you look at some of the measures by the government, the share of area that is irrigated now is much larger, and it's a secular increase, which means that although rainfall deficiencies and weather vagaries still matter, they matter less than they did in the past'. She added that greater access to farm credit, increased mechanisation, and improvements in crop and seed varieties have further strengthened the sector. She noted that 'Taken together, all of these measures point to a healthy rural economy and a highly resilient agriculture sector'.

CNX Nifty touched high and low of 24,677.05 and 24,604.15, respectively. There were 15 stocks advancing against 34 stocks declining, while 1 stock remain unchanged on the index. 

The top gainers on Nifty were Reliance Industries up by 3.52%, State Bank of India up by 2.84%, Bharat Electronics up by 2.36%, Eternal up by 1.90% and Titan Company up by 1.74%. On the flip side, Power Grid down by 3.90%, Tata Steel down by 1.91%, TCS down by 1.66%, JSW Steel down by 1.66% and Bajaj Auto down by 1.53% were the top losers. 

European markets were trading higher; UK’s FTSE 100 increased 24.66 points or 0.23% to 10,912.96, France’s CAC rose 63.1 points or 0.72% to 8,732.40 and Germany’s DAX gained 68.5 points or 0.26% to 26,194.80.

Asian stocks ended mostly lower on Thursday, as participants booked profits due to growing anxiety over massive capital spending on Artificial Intelligence (AI). Investor sentiments dulled after soft financial outlooks from major tech entities, including SanDisk, Western Digital, and Advanced Micro Devices (AMD), failed to meet exceptionally high market expectations. Lingering uncertainty surrounding the US-Iran conflict and hawkish comments from Federal Reserve also pressured equity investments. South Korea's KOSPI plunged due to extreme retail leverage in single-stock ETFs. An avalanche of forced liquidations and automatic margin calls also added the negative trend.