Quote on Daily Market Commentary for October 6th 2026 by Siddhartha Khemka - Head of Research, Wealth Management, Motilal Oswal Financial Services Ltd
Below the Quote on Daily Market Commentary for October 6th 2026 by Siddhartha Khemka - Head of Research, Wealth Management, Motilal Oswal Financial Services Ltd
Indian equity markets are expected to remain positive, with rate-sensitive sectors such as banks/NBFCs, real estate and consumption in focus ahead of tomorrow's RBI policy decision. The consensus expects a 25 bps repo rate hike from 5.25% to 5.50%, which would be the first increase since February 2023. On Tuesday, Indian equities extended their recovery for the second consecutive session, with the Nifty advancing 1.0% (220 points) to close at 22,776, following a 0.6% gain in the previous session that ended a four-day declining streak. The rebound follows an eight-week decline in which the Nifty fell 8.8%, the longest sequence of weekly losses since 2020. The correction has brought valuations to more reasonable levels, while Q2 business updates triggered stock-specific buying. Broader markets outperformed, with the Nifty Midcap 100 and Smallcap 100 rising 1.1% and 1.6%, respectively. Sectoral performance was largely positive. Nifty Chemicals led the gains, rising 2.0% on the broader market recovery and softer crude prices, as lower feedstock costs can support margins for downstream players. Pharma (+1.7%), Oil & Gas (+1.6%) and FMCG (+1.4%) also registered strong gains, while Healthcare, Metals, Consumer Durables and Auto advanced between 0.5% and 1.1%. Nifty Bank rose 0.8%, supported by healthy Q2 business updates, expectations around tomorrow's RBI policy and more attractive valuations following the correction. India's September Services PMI rose to a three-month high, supported by stronger demand in financial, consumer and digital services. However, activity for the July–September quarter was the weakest since 2022, indicating some moderation in broader momentum. The GST Council is also scheduled to meet tomorrow, with the focus on GST 2.0 process and compliance reforms, including redesigned compliance procedures and revised thresholds around notices and arrests. These measures could be relevant for consumer, retail and smaller businesses benefiting from formalisation. Meanwhile, the INR weakened to around 96.43/$, close to its all-time low, amid foreign portfolio outflows and elevated US yields. Overall, we expect markets to remain firm with a stock-specific bias in the near term. The RBI policy decision and GST Council outcomes will be the key triggers, while currency weakness and foreign flows remain the key risks.
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