The markets opened on a weak note on Tuesday with benchmark indices sliding as investors turned cautious ahead of the US Federal Reserve’s policy decision later this week. The BSE Sensex opened at 84,742.87, against its previous close of 85,102.69, and was trading at 84,465.38, down 637.31 points or 0.75 per cent at 9.50 am. The NSE Nifty opened at 25,899.55, compared to its previous close of 25,960.55, and declined to 25,754.90, losing 205.65 points or 0.79 per cent.
GIFT Nifty futures signalled a subdued start with the index trading around 25,965, approximately 100 points lower, reflecting the prevailing risk-off sentiment globally. “Indian equity markets enter today’s session in a cautious consolidation phase following a controlled corrective pullback from recent highs,” said Ponmudi R, CEO of Enrich Money. “The rise in US Treasury yields ahead of the Federal Reserve’s widely anticipated quarter-point rate cut has added a fresh layer of caution among global investors, exerting additional pressure on equities.”
The market breadth remained extremely weak, with only two gainers among the Nifty50 constituents. gained 0.38 per cent to trade at ₹3,781.30, while edged up 0.14 per cent to ₹2,089.20. On the losing side, emerged as the top loser, plunging 3.58 per cent to ₹2,823.40, followed by which fell 2.42 per cent to ₹290.00. declined 1.86 per cent to ₹4,014.40, while and both dropped 1.57 per cent to ₹1,062.50 and ₹821.15 respectively.
Foreign Institutional Investors continued their selling streak for the third consecutive session on December 8, offloading equities worth ₹655 crore. “FIIs were heavy net sellers in index options at nearly ₹10,844 crore, reflecting aggressive Call writing activity,” noted Ponmudi, adding that “yesterday alone witnessed ₹13.4 crore of fresh Call writing, clearly indicating the building of new short positions at higher levels.”
Domestic Institutional Investors, however, provided support by purchasing ₹2,542 crore during the same session. “After the RBI’s rate cut, Dalal Street briefly tried to scale higher, but Nifty tumbled through the session, slipping below the psychological 26,000 mark,” said Prashanth Tapse, Senior VP Research at Mehta Equities.
From a technical perspective, analysts remained cautious about near-term market direction. “Nifty 50 continues to remain in a sideways-to-bullish structure as long as it holds above the key 25,850 support,” said Ponmudi. Shrikant Chouhan, Head Equity Research at Kotak Securities, added that “as long as the market is trading below the 20-day SMA or 26,000/85400, the weak sentiment is likely to continue.”
Dr VK Vijayakumar, Chief Investment Strategist at Geojit Investments, highlighted the disconnect between largecap and mid-smallcap performance. “Even when the Nifty set a new record, 320 stocks in NSE 500 were trading below their peaks, leaving retail investors with portfolios dominated by mid and small caps, unhappy,” he said, adding that “overvalued stocks in the mid and smallcap segments are getting dumped, impacting their share prices.”
The commodities market saw mixed trends with gold finding support from China’s continued buying for the 13th consecutive month. “Gold has support at $4165-4135, while resistance is at $4,230-4,265,” said Rahul Kalantri, VP Commodities at Mehta Equities. Crude oil prices slipped nearly 2 per cent in international trade after Iraq restored production at major oilfields.