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Indian equity markets are likely to make cautious start on Thursday, despite optimistic cues from global markets. Traders are likely to remain subdued amid the ongoing U.S.-Iran conflict and volatile crude oil prices. Further, traders may remain cautious as Foreign Institutional Investors (FIIs) remained net sellers, pulling out Rs 5,834.90 crore from equities on May 6, 2026.

Some of the key factors to be watched: 

India's growth to moderate to 6.6% in FY27: S&P Global said that India's GDP growth is projected to moderate to 6.6 per cent in the current fiscal from the earlier estimated 7.1 per cent, and energy and food security reforms would be essential to achieve the Viksit Bharat goal by 2047.

India, South Korea likely to hold FTA review talks on May 25: The report said that India and South Korea are expected to hold negotiations on May 25 regarding the review of the comprehensive economic partnership agreement (CEPA), which was implemented in January 2010.

India's manufacturing growth sentiment positive in Q4: The Federation of Indian Chambers of Commerce & Industry (FICCI) report stated that Growth sentiment in India's manufacturing sector stays positive during the fourth quarter of FY26 despite rising input costs and geopolitical uncertainties.

Goods, services exports up 4.59% to $863.11 billion in FY26: Commerce ministry data showed that the country's goods and services exports rose 4.6 per cent to an all-time high of $863.11 billion during 2025-26, up from $825.26 billion in 2024-25, despite global economic uncertainties.

Unregistered business entities grow 8% in 2025: A government survey report stated that Unregistered businesses or unincorporated enterprises grew by 8 per cent to reach 7.92 crore and added 74.52 lakh jobs between January and December 2025.

Global front: The US markets ended higher on Wednesday amid optimism about an end to the conflict in the Middle East. Asian markets are trading in green on Thursday, tracking strong cues from Wall Street overnight.

Back home, a last-hour buying helped Indian equity indices to end near day’s high points on Wednesday, with both Sensex and Nifty ending with gains of over a percent, on reports of US nearing to end war with Iran. After a positive start, markets traded near neutral lines but witnessed rally towards the end of the session. Finally, the BSE Sensex surged 940.73 points or 1.22% to 77,958.52 and the CNX Nifty was up by 298.15 points or 1.24% to 24,330.95.

Some of the important factors in trade:

India’s services sector sees robust expansion in April: Sentiments were upbeat, as India’s services sector witnessed robust expansion in the month of April 2026, after activity and new orders strengthened, even as new export orders eased. According to the survey report, the seasonally adjusted HSBC India Services PMI Business Activity Index surged to 58.8 in April from 57.5 in March.

SCBs register robust credit growth of 15.9% in FY26 driven by strong economic activity: Adding some optimism, the Finance Ministry has said that Scheduled Commercial Banks (SCBs) in India have registered a significant 15.9 per cent credit growth in fiscal year 2025-26 (FY26), indicating strong economic activity and persistent demand for loans across several sectors.

Prolonged crisis in West Asia likely to slow India’s GDP growth to below 6.5%: Traders overlooked Confederation of Indian Industry (CII) President Rajiv Memani’s statement that a prolonged conflict in West Asia, accompanied by major disruptions in shipping and rising energy prices, poses a serious threat to India's economic growth momentum and likely to pull down the country's gross domestic product (GDP) growth to below 6.5%.

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