The Indian equity market is poised for a tentative start to the final trading week of 2025. Benchmark indices, the Sensex and Nifty 50, are expected to open on a mixed note on Monday, December 29, influenced by divergent signals from global peers and a lack of strong domestic triggers.
Market Recap and Weekly Performance
In the previous session on Friday, the domestic market closed in negative territory. The Sensex dropped 367 points, or 0.43%, to settle at 85,041.45. Similarly, the Nifty 50 declined by 100 points, or 0.38%, ending the day at 26,042.30. The sell-off was attributed to continued profit-booking by investors amid muted global cues and a holiday-shortened week.
Despite Friday's dip, the benchmarks managed to post modest gains for the week ended December 26. The Sensex edged higher by 112 points, or 0.13%, breaking its two-week losing streak. The Nifty 50 rose by 0.30%, snapping a three-week decline.
Ajit Mishra, Senior Vice President of Research at Religare Broking Ltd., commented on the market's behavior. He noted that markets witnessed a marginal decline after range-bound movement, extending the ongoing consolidation phase amid low volumes. Sectoral performance mirrored the benchmark, with IT, financials, and auto sectors emerging as the key laggards.
Key Factors Influencing Today's Market
Several domestic and international developments will guide investor sentiment as trading commences today.
Asian Markets Send Mixed Signals: Major Asian indices presented a mixed picture at the opening. Japan's Nikkei 225 fell by 0.55%, while South Korea's Kospi gained 0.62%. Hong Kong's Hang Seng index futures traded slightly lower, and Australia's S&P/ASX 200 remained flat.
Gift Nifty Points to a Positive Start: Early indications from the Gift Nifty futures provided a glimmer of optimism. The Gift Nifty was trading around the 26,094 level, up 20.50 points or 0.8% compared to the previous close of Nifty futures, suggesting a positive opening for the Indian benchmark index.
Wall Street's Muted Finish: US markets ended Friday's session on a flat note. The S&P 500 slipped a marginal 0.03% but still recorded weekly gains. The Dow Jones and Nasdaq Composite also posted minor declines. For the week, all three major US indices advanced over 1%.
Global Cues and Commodity Movements
Geopolitical developments and commodity price swings are back in focus at the start of the new week.
On the geopolitical front, discussions between US President Donald Trump and Ukrainian President Volodymyr Zelenskiy regarding a potential peace agreement for the Russia-Ukraine conflict are being closely watched.
In commodity markets, silver prices experienced high volatility, surging past $80 per ounce before retreating sharply. Gold prices slipped nearly 1% after a record-breaking rally this year. Oil prices edged higher in early Asian trade, with Brent crude futures rising 0.94% to $61.21 a barrel, as tensions in the Middle East raised supply concerns.
From China, a commitment to expand fiscal spending in 2026 indicated continued government support for growth. However, data showing a decline in industrial profits for November reinforced concerns about soft domestic demand.
Expert Outlook and Trading Strategy
Market experts anticipate the ongoing consolidation to persist in the absence of major catalysts. Ajit Mishra of Religare Broking advised caution, stating, "In the absence of any major triggers, consolidation is likely to persist amid subdued activity."
He further added that news-based sectoral moves may offer selective trading opportunities. Investors are advised to avoid aggressive bets and instead focus on accumulating quality stocks from relatively stronger sectors during market dips.
As the year 2025 draws to a close, trading activity is expected to remain cautious and volume-light, with participants assessing the global landscape and positioning for the new year.
