Indian equity benchmarks staged a strong intraday recovery on Thursday, erasing most of their early losses to close nearly flat as investors cautiously positioned themselves ahead of the Reserve Bank of India's (RBI) monetary policy announcement scheduled for Friday.

Key Highlights

• Indian equities recovered from early losses as investors awaited the RBI policy outcome.
• Rising crude prices and Middle East tensions kept market sentiment cautious throughout.

The market opened on a weak note amid negative global cues, elevated crude oil prices, and continuing geopolitical tensions in West Asia. However, buying interest emerged near key support levels, helping benchmark indices rebound from the day's lows and stabilize by the close.

According to Hariprasad K, Research Analyst and Founder of Livelong Wealth, Indian equities displayed resilience despite multiple headwinds.

"Indian equities delivered a decent recovery today, overcoming a weak start to finish largely unchanged. The market opened under pressure as weak global cues, elevated crude oil prices, and persistent geopolitical tensions in the Middle East weighed on sentiment. However, the selling failed to sustain, with buyers stepping in near key support levels and helping benchmarks erase most of their intraday losses," he said.

Also Read: Sensex Sinks Nearly 900 Points as Geopolitical Jitters Rattle Markets

RBI Policy, Oil Prices Keep Investors on Edge

Market participants remained cautious ahead of the RBI's Monetary Policy Committee (MPC) decision, which is expected to be one of the key drivers of market direction in the near term. Investors are closely watching the central bank's commentary on inflation, growth outlook, liquidity conditions, and the impact of rising crude oil prices.

Hariprasad added that despite the recovery, investor sentiment remained guarded as traders refrained from taking aggressive positions ahead of the policy outcome.

Crude oil prices continue to be a major concern for Indian markets due to the country's dependence on energy imports. Brent crude, the global benchmark, traded around $96 per barrel, keeping inflation worries alive and raising concerns about potential pressure on corporate margins and the rupee.

Asian Markets End Lower Amid Global Uncertainty

Broader Asian markets also reflected risk aversion, with major indices ending in negative territory. South Korea's Kospi, Japan's Nikkei 225, China's Shanghai Composite, and Hong Kong's Hang Seng index all closed lower as investors assessed geopolitical developments and global economic risks.

Analysts believe market volatility could persist in the coming sessions as investors track the RBI policy decision, crude oil price movements, foreign institutional investor (FII) activity, and developments in West Asia. While India's domestic economic fundamentals remain supportive, global uncertainties are likely to keep sentiment fragile in the short term.