Indian equity benchmarks commenced Friday's trading session on a positive note, extending cautious optimism into the new year. The key indices, Nifty50 and BSE Sensex, both opened in the green, reflecting a steady start for domestic markets.
Market Opening and Key Levels
At the opening bell, the Nifty50 was above the 26,150 mark, while the BSE Sensex was up by approximately 100 points. As of 9:16 AM, the Nifty50 was trading at 26,172.90, registering a gain of 26 points or 0.10%. Simultaneously, the BSE Sensex stood at 85,282.91, up by 94 points or 0.11%.
Primary Drivers and Analyst Outlook
Market participants are now shifting their focus to a confluence of domestic and international factors that are expected to steer market direction in the near term. Analysts highlight that the markets will take cues from:
- December-quarter corporate earnings (Q3 FY25).
- Expectations building around the upcoming Union Budget.
- Overseas developments, including progress on the India-US trade deal and potential actions by the US Federal Reserve.
Earnings growth is anticipated to remain the fundamental driver of market trajectory through 2026. Dr. VK Vijayakumar, Chief Investment Strategist at Geojit Investments Limited, provided his insights on the economic momentum. He stated that the impressive 25.8% year-on-year increase in passenger vehicle sales in December is a positive indicator for the auto sector and, more broadly, confirms the growth momentum in the economy.
"It has to be watched whether this growth sustains, albeit at a slower pace, going forward," Dr. Vijayakumar noted. He emphasized that sustaining this economic growth is crucial as it is necessary to deliver the earnings growth required for market resilience and a gradual upward movement.
He also pointed out that while the positive news for autos may already be factored into stock prices, the consumer durables sector, which lagged last year, has potential for catch-up. "The beneficial impact of the interest rate cuts and GST cuts are yet to reflect in the demand for consumer durables. In the short-term, this is one segment that has good prospects," he added.
Global Sentiment and Other Asset Classes
The risk-on sentiment was visible globally at the start of the New Year. US equity index futures traded higher, pointing towards a positive opening for Wall Street. In the commodities space, precious metals like gold and silver advanced in early trade on Friday. Gold edged higher after hitting a two-week low in the previous session, with both metals recovering some of the losses from the past week. Notably, despite recent pullbacks, these metals recorded historic gains over the course of 2025.
Institutional Activity
On the institutional flows front, data from Wednesday showed a divergent trend. Foreign Portfolio Investors (FPIs) continued to be net sellers, offloading Indian equities worth Rs 3,268 crore. However, Domestic Institutional Investors (DIIs) provided a counterbalance, acting as net buyers and purchasing shares worth Rs 1,526 crore, thereby offering support to the market.
As the trading week concludes, investors are likely to remain vigilant, parsing corporate results and global signals to gauge the market's next move.
