Markets recover significantly, close moderately

Indian equity markets staged a notable recovery on February 6, 2026, closing modestly higher despite early weakness driven by global cues and a persistent sell-off in the IT sector. The benchmark Nifty 50 ended at 25,693.70, up 50.90 points or 0.20%, while the Sensex settled at 83,580.40, gaining 266.47 points or 0.32%. The session saw volatile trading, with the Nifty dipping to around 25,492 intraday before rebounding on fag-end buying, supported by strength in FMCG, banking, and select earnings reactions.

The Reserve Bank of India's Monetary Policy Committee (MPC) kept the repo rate unchanged at 5.25%, aligning with market expectations, while maintaining a neutral stance. This decision came amid moderating inflation (projected at around 2.1% for FY26) and steady GDP growth forecasts (revised upward to 7.4% for FY26 in some assessments). The RBI's hold provided stability, though no rate cut materialized despite earlier room for easing.

Global markets weighed on sentiment early, with Asian indices like the Hang Seng and Kospi down sharply (around 1.5–1.75%), and U.S. futures mixed amid ongoing tech sector pressures. However, Indian benchmarks outperformed peers, continuing a theme of relative resilience amid the U.S.-India trade deal optimism and domestic fundamentals.

Key sectoral performers included FMCG, buoyed by cigarette stocks. ITC emerged as the top Nifty contributor, surging around 5–6% after reports of price hikes on higher-priced cigarette packs (15–30% in some cases) to offset the recent excise duty and 40% GST impact effective February 1. Godfrey Phillips rallied even more sharply, up double digits (as much as 13%), with its 97mm pack reportedly rising 25% to Rs 300 from Rs 240. 

While this demonstrated pricing power, concerns lingered over potential volume hits and incomplete tax offset, which could pressure margins ahead. Earnings reactions drove notable moves. Nykaa (FSN E-Commerce) posted strong Q3 FY26 results, with revenue up 27% YoY, EBITDA surging 63%, and net profit more than doubling (around 143–160% YoY to Rs 63–68 crore, including some exceptional items). 

Beauty and fashion segments led growth, pushing the stock higher. MRF delivered robust Q3 numbers, with net profit more than doubling (up ~119–121% YoY to ~Rs 692 crore) on strong operating leverage, revenue growth of 15%, and margin expansion. The tyre maker's shares jumped up to 9%, aided by a dividend announcement.

Life Insurance Corporation of India (LIC) saw gains of around 7–8% after reporting a 17% YoY rise in consolidated net profit to ~Rs 12,930–12,958 crore, driven by higher premium income (up 17–18%) and improved value of new business margins.