Monetary Policy Committee (MPC) meeting outcome will be watched. Trading of Nifty 50 index futures on the Singapore stock exchange indicates that the Nifty could rise 16 points at the opening bell.

The Reserve Bank of India's three-day monetary policy meeting commenced on 4 August 2020. RBI will announce its policy stance today, 6 August 2020. Investors will keep an eye on whether RBI extends moratorium beyond August 2020.

Meanwhile, Securities and Exchange Board of India (SEBI) Chairman Ajay Tyagi's term of appointment was extended by 18 months. The current SEBI Chairman's term was due to end on August 31, 2020.

Overseas, Asian stocks were mixed Thursday as investors continued to watch tensions between the U.S. and China.

On Wednesday, U.S. Secretary of State Mike Pompeo said that President Donald Trump's administration wants to ban “untrusted” Chinese apps such as TikTok and WeChat from U.S. app stores. That development followed tensions between Washington and Beijing heating up in recent weeks.

In US, Wall Street's main indexes rose on August 5 after Disney delivered a surprise quarterly profit, with sentiment aided by signs that a coronavirus fiscal relief package was imminent.

US services industry activity gained momentum in July as new orders jumped to a record high, but hiring declined, supporting views that the labor market recovery was faltering amid a resurgence in new COVID-19 infections across the country. The Institute for Supply Management (ISM) said on August 5 its non-manufacturing activity index increased to a reading of 58.1 last month, the highest since March 2019, from 57.1 in June. The index slumped to 41.8 in April, which was the lowest reading since March 2009.

Reports suggested that Trump administration officials and congressional Democratic leaders are working to reach a coronavirus aid bill deal by the end of the week even if the parties still remain far apart on the issues.

In economic news, the final monthly reading of the closely-watched ISM service sector purchasing managers index jumped to a reading of 58.1 in July, signalling stronger economic growth.

Back home, key benchmark indices ended near flat line after a volatile session on Wednesday. Weak domestic macroeconomic data spoiled investors sentiment. Investors were also cautious ahead of the outcome of the RBI's monetary policy meeting on Thursday, 6 August 2020. The barometer index, the S&P BSE Sensex fell 24.58 points or 0.07% at 37,663.33. The Nifty 50 index rose 6.40 points or 0.06% at 11,101.65.

Foreign portfolio investors (FPIs) sold shares worth Rs 60.18 crore, while domestic institutional investors (DIIs), were net sellers to the tune of Rs 425.98 crore in the Indian equity market on 5 August, provisional data showed.