Indian stock markets on Friday, June 6, 2025, opened with caution as investors adopted a wait-and-watch approach ahead of the Reserve Bank of India's (RBI) crucial monetary policy announcement, scheduled for 10 AM. This anticipation for the RBI's decision, particularly regarding policy rates, set a subdued tone for the trading session's start.

The benchmark indices reflected this cautious sentiment. The Nifty 50 opened at 24,748.70, experiencing a marginal decline of just 2.20 points or 0.01 per cent. Similarly, the BSE Sensex also began the day flat, trading at 81,434.24, down by a mere 7.80 points or 0.01 per cent.

Market experts are keenly observing the RBI's Monetary Policy Committee (MPC) decision. There is a prevailing belief that any decision on the policy rate could significantly influence market sentiment. Expectations are divided, with some analysts anticipating a 25 basis points (bps) rate cut, while others foresee a more substantial 50 bps reduction. Experts suggest that a 50 bps cut could provide a strong boost to market sentiment and potentially trigger a rally following the announcement.

In the broader market, however, indices displayed a slightly more positive tone. The Nifty 100 opened flat but in the green. The Nifty Midcap 100 and Nifty Smallcap 100 indices each gained 0.33 per cent. Concurrently, volatility in the Indian markets saw a decline, with the India VIX falling by more than 4 per cent, indicating reduced investor nervousness ahead of the RBI's announcement.

Among the sectoral indices on the National Stock Exchange (NSE), the trend was mixed. While most sectors opened in the green, Nifty Private Bank was an exception. Nifty Media shares gained 0.33 per cent, Nifty Metal rose by 0.36 per cent, and Nifty Auto increased by 0.16 per cent. The Nifty IT index remained largely flat, registering a slight uptick of 0.07 per cent.

Sharing his insights, Ajay Bagga, a Banking and Market Expert, commented to ANI, "In India, markets are treading water, waiting for the 10 AM RBI MPC meeting outcome. We expect a 25 bps rate cut, though some analysts are calling for a 50 bps rate cut." He attributed this expectation to several factors, including controlled consumer inflation, subdued growth in credit offtake, positive monsoon prospects which should help keep inflation in check, and a falling US dollar that has provided relief to emerging market currencies and enabled many central banks to cut rates this year. Bagga predicted that "Markets will rally post the RBI announcement."

Looking beyond the immediate RBI policy, Bagga also highlighted the next significant event for market participants: "The next big event will be the US May non-farm payrolls data, which will show some direction to the bond markets and will impact stock market sentiments."

Meanwhile, other Asian markets exhibited a mixed trend on Friday morning. Japan's Nikkei 225 gained 0.47 per cent, Singapore's Straits Times rose by 0.14 per cent, and Indonesia's Jakarta Composite was up by 0.63 per cent. Hong Kong's Hang Seng index also saw an increase of 0.19 per cent. In contrast, the Taiwan Weighted index experienced a marginal decline of 0.08 per cent at the time the reports were filed.