Stock Market Outlook Today: Sensex, Nifty Likely to Stay Positive Post RBI Repo Rate Cut; Bank Nifty Eyes Gain

Indian equity markets are expected to maintain a positive bias on Monday as investors digest the impact of the RBI's 25-basis-point repo rate cut announced last week. The move, which brought the repo rate down to 5.25%, has lifted sentiment across rate-sensitive sectors and spurred renewed buying interest in financials, autos and metals.

Stock Market Prediction Today, 8 December 2025 After RBI Repo Rate Cut

According to Bajaj Broking Research, benchmark indices ended Friday, 5 December, on a strong footing, buoyed by the RBI's monetary policy actions. The Sensex settled at 85,712.37, gaining 447.05 points or 0.52%, while the Nifty ended at 26,186.45, up 152.70 points or 0.59%.

Sectoral performance was broadly positive, with Nifty PSU Bank, IT, Auto, and Metal indices showing notable strength, though Media, Pharma, and Consumer Durables saw mild profit-booking.

Siddhartha Khemka, Head of Research, Wealth Management, Motilal Oswal Financial Services Ltd, noted, "The index printed a strong bullish candle, marked by a higher high and higher low, indicating a consolidation phase with an upward tilt. Fresh buying interest has emerged near the lower boundary of the two-month ascending channel."

Broader market trends were mixed, with the Nifty Midcap 100 rising 0.49%, while the Smallcap 100 slipped 0.57%, reflecting selective participation in the rally. Investors are also closely watching the US Consumer Price Index data due this week, which could influence the global interest rate trajectory.

The RBI's rate cut, coupled with Rs 1 lakh crore in government bond purchases and a USD 5 billion USD/INR swap, has bolstered liquidity in the system. The central bank also revised India's FY26 GDP growth forecast to 7.3% while lowering inflation expectations.

These measures have strengthened the rupee to around Rs 89.96 per USD and supported buying interest in financials, as lower borrowing costs ease funding pressures. Nifty Financial Services rose 1.2%, Bank Nifty gained 0.8%, PSU Banks 1.5%, and Auto index advanced 0.8% last week.

Nifty Prediction Today: How Market Will Trade After RBI Policy Decision

Looking ahead, Bajaj Broking Research expects the Nifty to consolidate with an upward bias, potentially reaching 26,500 in the coming week. "The recent 3-4 session pause offers an opportunity to accumulate quality names gradually," the report said. Crucial support is placed at 25,900-25,700, coinciding with the bullish gap, 50-day EMA, and lower trendline of the channel.

Bank Nifty Outlook, 8 December 2025

Bank Nifty continued to outperform post-rate cut, registering a strong bullish candle. Analysts anticipate the index will consolidate within the 58,500-60,100 zone. A decisive move above Monday's high of 60,114 could open the way for further gains toward 60,400 and subsequently 61,000. Support rests at 58,300-58,600, aligning with the breakout zone and past two weeks' lows, preserving a short-term positive outlook.

Investors are advised to monitor global cues, liquidity conditions, and sectoral trends, while gradually accumulating quality stocks amid this constructive market structure. The combination of domestic policy support and favorable global signals is likely to sustain market optimism heading into the second week of December 2025.

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