Bulls retained their control over the Indian stock market in Tuesday's trade, October 6, as frontline indices closed higher for the second straight day, with the rally largely supported by banks, while supportive global cues also aided sentiment ahead of a crucial RBI policy decision.
Stocks opened the session higher, followed by a strong rally on Wall Street, and momentum was sustained through the close, supporting a partial recovery from recent losses. Market attention now shifted to the RBI's policy outcome tomorrow, with the Street largely anticipating a 25-basis-point repo rate hike, which would be the RBI's first increase since February 2023.

Indian stock market today The Nifty 50 wrapped up the trade with a 0.72% gain to settle at 22,717.40, while the Sensex surged 0.72% to 72,905. The broader markets, however, posted even bigger gains, with the Nifty Smallcap 100 index surging 1.54% and the Nifty Midcap 100 index rallying 0.95%.
Sectoral performance was largely tilted towards gainers, with chemicals topping the charts, followed by pharma, oil and gas, private banks and FMCG. On the flip side, IT was the biggest laggard, while realty, PSU banks and cement also closed the trade lower.

Elsewhere, Brent crude held losses from Monday, when it fell almost 2% to about $100.30 a barrel. The decline followed rising Persian Gulf exports and a Saudi Arabian price cut that pointed to a loosening market. Stock markets have largely looked through last month's Federal Reserve interest-rate hike, elevated energy costs and renewed inflation concerns that sent global bond yields soaring.
Instead, investors have focused on September-quarter earnings. In the bond market, US Treasury yields remained near their multi-decade highs. The 10-year US Treasury yield climbed to around 5.30%, from 5.28% on Friday, after it briefly crossed the 5.35% mark, its highest level since 2002, driven by inflation concerns despite easing bets of a US rate hike later this month.

The Monetary Policy Committee (MPC) may raise the key repo rate by 25 basis points to 5.50% on October 7, according to nine of 10 economists surveyed by Mint, with only one respondent expecting a pause. Nikkei, Kospi outlook: Can bulls sustain momentum above key levels?
Among other key Asian markets, Japan’s Nikkei 225 rose 1.1% to 70,683.98. The benchmark has returned above the 70,000 mark this week for the first time since early July. South Korea’s Kospi lost 0.9% to 6,941.39. Technology-related stocks in Japan and South Korea were volatile.

Japanese chip-testing equipment manufacturer Advantest gained 3.9%, while OpenAI investor SoftBank Group fell 3.1% after its CEO, Masayoshi Son, warned of potential dangers related to the technology. South Korea’s Samsung Electronics dropped 1.5%, while memory chipmaker SK Hynix slipped 3.7%.
Hong Kong’s Hang Seng climbed 0.8% to 24,234. Australia’s S&P/ASX 200 rose 0.6% to 8,735.70. Taiwan’s Taiex edged up 0.2%. Vipin Kumar, AVP-Research at Globe Capital Market, said the Nikkei is gradually moving towards its all-time high of 72,831 spot levels.

Any dips towards the 69,500–69,000 spot levels should be considered a fresh buying opportunity. On the Kospi, Vipin Kumar said the index is still consolidating in a congestion range, with immediate support around the 6,700–6,580 spot zone and resistance around 7,220 spot levels.
A decisive close above 7,220 is essential for a sustainable up move towards 7,800 spot levels.(more to come)