Indian Stock Market Trends: Sensex, Nifty Insights & 2026 Predictions for Savvy Investors
US-India trade deal slashes tariffs to 18%—Sensex surges 2.5%! Nifty eyes 29k by Dec amid 7.4% GDP boom & 2% inflation. IT crashes, energy soars: top 10 stocks to buy NOW? Uncover 2026’s hidden winners before RBI MPC rocks markets!
Indian stock market trends in early 2026 show resilience amid volatility, with BSE Sensex hovering around 83,800 and NSE Nifty 50 near 25,700 as of February 4 close. Investors seek fresh analysis on Thursday, February 5, 2026, to navigate Bank Nifty pressures and sector rotations driven by GDP growth and RBI policies.
Indian Market Overview
BSE Sensex closed at 83,817.69 on February 4, 2026, up slightly by 0.09% amid mixed global cues. NSE Nifty 50 ended at 25,776, gaining 0.19%, reflecting bullish breadth with 1,630 advancers on NSE.
Bank Nifty traded under pressure below 58,500, with forecasts pointing to supports at 58,000 aligning with 100-DMA. Investor sentiment remains cautiously optimistic, buoyed by FII buying of ₹5,236 crore on February 3, though volatility persists post-Budget.
Key Economic Drivers
India’s GDP growth for FY26 is estimated at 7.4%, fueled by consumption and investment, outpacing last year’s 6.5%. CPI inflation stays low around 2%, below RBI’s 2-4% target, supporting monetary easing amid cooling food prices.
RBI repo rate stands at 5.25% post-125 bps cuts since February 2025, with BNP Paribas eyeing another 25 bps trim in February 2026 MPC. Unemployment data reflects rural spending boosts from Budget, linking to market upticks in infra and defence.
These drivers connect to equity rallies, as lower rates boost lending and capex, countering bond yield pressures from FY27 borrowings of ₹17.2 trillion.
NIFTY Today: Detailed Breakdown
- Opening Levels: Nifty opened flat around 25,700 on February 4, testing intraday high of 25,802 amid US-India trade deal optimism.
- Intraday Volatility: Swung 240 points, with VIX up sharply from January, signaling caution but contained by DII buys.
- Closing Performance: Settled at 25,776 (+0.19%), supported by energy and infra; IT dragged on AI concerns.
- Technical Indicators: Below 25,900 resistance; support at 25,575-25,500, with RSI neutral post-correction.
- Volume and Breadth: High volume in midcaps (up 0.6%), broader advance-decline favors bulls.
- FII/DII Flows: FII net buyers ₹5,236 Cr, DII ₹1,014 Cr, cushioning volatility.
BSE Sensex vs Nifty 50 Trends: February 2026 Comparison
| Date | BSE Sensex Close | % Change | NSE Nifty 50 Close | % Change | Key Driver |
| Feb 1 | 81,666.46 | +1.17% | 25,088.4 | +1.06% | Infra gains, Reliance |
| Feb 2 | 83,739 | +2.5% | 25,727 | +2.5% | US-India trade deal |
| Feb 3 | N/A | – | N/A | – | Mixed FII data |
| Feb 4 | 83,817.69 | +0.09% | 25,776 | +0.19% | Tech sell-off offset |
| Feb MTD | -1.90% (monthly) | +1.81% (4w) | Budget volatility |
Sensex lagged Nifty slightly in breadth, hit harder by banking weakness.
Latest News Highlights
- US-India Trade Deal: Reduced tariffs from 25% to 18% sparked February 4 rally, boosting Adani Ports and Reliance; immediate 2.5% Sensex surge.
- Budget FY27 Impacts: Fiscal deficit at 4.3%, high borrowings pressure yields; defence capex aids related stocks, STT hike curbs derivatives liquidity.
- RBI Policy Preview: Expected steady repo at 5.25% Feb MPC, but easing narrative supports growth stocks amid low CPI.
- Q3 Earnings Flash: Sheela Foam +20%, Bharat Coking Coal -7%; biopharma gains on medical tourism push.
- FII Volatility: Net buys but year-start selling on global risks; rupee stability key for flows.
Each news item amplified sector swings, with trade deal lifting exports.
Foreign Indices Movements Influencing Indian Markets
- US S&P 500 (US500): Rose to 6,912 (+0.42%) on Feb 5, 2026; positive spillover via FII optimism.
- Dow Jones: Up 0.23% or 113 pts Feb 4 open, aiding metal/energy via risk-on.
- Nasdaq: Flat early 2026 amid tech woes (Microsoft/Tesla dips), pressuring Indian IT.
- Nikkei 225 (Japan): Strong yearly gains influenced infra via supply chains.
- Kospi (South Korea): +76% in 2025, inspired tech recovery but added volatility.
US indices drove FII inflows, while Nasdaq weakness hit TCS/Infosys.
Performance Overview
Top 10 Stocks to Buy on NSE/BSE for 2026
- Reliance Industries (RIL): P/E 25, PEG 1.2, yield 0.8%; trade deal beneficiary, green energy pivot.
- ICICI Bank: P/E 18, PEG 1.0; loan growth 15%, rate cuts aid NIMs.
- Adani Ports: P/E 30, yield 0.5%; infra capex, volume up 20%.
- Bajaj Finance: Buy rated, TP ₹1,195; AUM +22% FY26, MSME rebound.
- Power Grid: +7.75% recent; defence Budget, stable yields.
- NTPC: Energy demand, yield 2%; green transitions.
- Larsen & Toubro (L&T): Infra orders +30%, P/E 28.
- Tata Motors: EV push, +5.49%; auto sales rebound.
- Hindalco: Metals rally, P/E 12, global cues.
- IOCL: TP ₹172.75; refining margins, volume growth.
Day's Top 10 Gainers and Losers (Feb 4, 2026 Approx.)
| Rank | Gainers | % Change | Analysis | Losers | % Change | Analysis |
| 1 | Power Grid | +7.75% | Budget capex | Tech Mahindra | -3.98% | AI fears |
| 2 | Tata Motors PV | +5.49% | Auto recovery | Wipro | -3.55% | IT sell-off |
| 3 | Adani Ports | +4.30% | Trade deal | Infosys | -1.52% | Global tech |
| 4 | Eternal/ONGC | +4% | Energy | TCS | -0.55% | Sector drag |
| 5 | BEL | +3.52% | Defence | Axis Bank | -2.16% | Banking pressure |
| 6 | RIL | +3.11% | Diversified | HCL Tech | -3% | AI concerns |
| 7 | M&M | +2.82% | Auto | Shriram Fin | -3.56% | Credit worries |
| 8 | Hindalco | +2.88% | Metals | Cipla | -1.31% | Pharma mixed |
| 9 | L&T | +2.77% | Orders | Titan | -0.81% | Consumer caution |
| 10 | Trent | +3% | Retail | Kotak Bank | -0.75% | Nifty Bank weak |
Gainers led by cyclicals; losers IT/banks on cues.
Sector Performance: February 2026 Table
| Sector | % Change (Recent) | Key Metrics/Earnings | Outlook 2026 |
| IT | -6% | AI disruption, Q3 weak | Recovery post-cuts |
| Banking | -1-2% | NIM pressure, AUM +22% | Rate easing boost |
| Pharma | +2-3% | Biopharma Budget, SunPharma +2.3% | Medical tourism |
| Consumer Goods | +1% | Rural spend, HUL +0.1% | Inflation low aids |
| Energy/Oil&Gas | +1-2% | ONGC lead, refining | Trade deals |
| Infra | +1.6% (Nifty Infra) | Capex FY27 | Defence/rail |
Pharma, energy outperform; IT lags on global tech.
Analysis and Recommendations
Actionable insights favor cyclicals over defensives amid 7.4% GDP. Diversify: 40% largecaps (RIL, ICICI), 30% midcaps (Adani Ports), 20% sectors (energy/pharma), 10% gold/ETFs.
Low-Risk Portfolio: ICICI Bank, NTPC, HUL – Pros: Stable yields 1-2%, earnings growth; Cons: Lower alpha; Drivers: Q3 steady.
Medium-Risk: L&T, Tata Motors – Pros: Infra/auto boom; Cons: Volatility; +20-30% potential.
High-Risk: Adani Ports, BEL – Pros: Trade/defence triggers; Cons: Geopolitics; PEG <1.5.
Stock Recommendations for Today (Feb 5, 2026)
- Buy IOCL (₹172.75 CMP): Strong refining margins amid trade deal, volume growth; target ₹200 (16% upside), stop-loss ₹165. Budget energy push adds tailwinds.
- Buy Petronet LNG (₹281 CMP): Investec top pick for 2026, TP ₹400 (44% upside); Dahej expansion to 22.5 MMTPA, LNG glut lowers prices boosting imports. Sagar Doshi recommends.
- Buy MRPL: Energy rally, refining upcycle; pair with Petronet for sector play, strong Q3 traction.
- Buy Bajaj Finance (CMP ₹7,000s): Nomura Buy TP ₹1,270; AUM +22% FY26, MSME rebound post-provisions. Credit growth catalyst.
- Buy Exide Industries: Citi Buy TP ₹480, Nomura upgrade TP ₹398; Q3 beat, auto/OEM demand, lithium plant by Mar 2026.
- Buy Pidilite Industries: Goldman Sachs Buy TP ₹1,700; Q3 EBITDA +18.5% YoY, volume-led growth.
- Buy Solar Industries: Goldman Sachs Buy TP ₹18,360; record Q3 EBITDA/PAT +35/38% YoY, defence boom.
- Watchlist Adds: Hindustan Copper, LIC, Trent, Coal India (earnings buzz); ICICI Bank TP ₹1,750 (31% upside).
Rationale ties to trade deal energy lift, Q3 beats, RBI easing preview—favor cyclicals, trail stops amid VIX.
Final Thought
Indian stock market trends signal resilience, with BSE Sensex stabilizing near 83,800 and NSE Nifty 50 around 25,800 as of February 5, 2026 close. Key takeaways include robust 7.4% India GDP growth projections fueling capex cycles, alongside CPI inflation at a benign 2% enabling RBI's dovish repo rate stance at 5.25%—prime tailwinds for cyclicals like energy and infra. However, vigilance is needed on IT sector drags from global AI shifts and banking pressures in Nifty Bank trends below 58,500 ahead of February MPC outcomes.
A unique insight: The US-India trade deal slashing tariffs to 18% masterfully offsets Budget FY27 volatility from 4.3% fiscal deficit and STT hikes, positioning Nifty for a 29,000 year-end target amid FII inflows. Top NSE/BSE stocks in pharma and defence shine, per sector performance data.
Disclaimer: This analysis on Indian stock market trends is for educational and informational purposes only and does not constitute financial, investment, legal, tax, or accounting advice. Markets are volatile; past performance isn't indicative of future results. Consult a qualified financial advisor before making investment decisions.
