Indian stock market indices, the Sensex and Nifty 50, are expected to start with a flat or slightly positive trend on December 29, following mixed global cues and ongoing geopolitical factors.
Global and Asian Market Cues
GIFT Nifty trends suggest a positive opening for the Indian market, trading near the 26,100 level, a rise of 20.50 points or 0.8% from the previous Nifty futures close. Asian markets displayed mixed performance, with the MSCI AC Asia Pacific index up by 0.38%, driven by gains in South Korea's Kospi and Hong Kong's Hang Seng index. Japan's Nikkei 225 was down by 0.5% while China's CSI 300 index was slightly down by 0.04%. Wall Street concluded last week near record highs, although gains were pared by the close, with the S&P 500 and Nasdaq slightly down.
Market Performance on December 26
The Indian stock market closed lower on Friday, December 26, due to persistent selling pressure amid a lack of fresh catalysts and mixed global signals. The Sensex fell 367 points, or 0.43%, to close at 85,041.45, while the Nifty 50 declined 100 points, or 0.38%, to settle at 26,042.30. Despite the weak closing, both benchmarks recorded marginal gains for the week, with the Sensex edging up 112 points, or 0.13%, and the Nifty 50 advancing 0.30%.
Market Dynamics and Expectations
Trading is expected to be range-bound due to low volumes during the holiday-shortened week. According to Ajit Mishra, SVP, Research, Religare Broking Ltd., the Nifty gradually drifted lower, testing the 26,000 mark and closing at 26,042.30 on December 26. Sectoral performance mirrored the benchmark, with most indices ending in the red, and IT, financials, and auto sectors being the primary laggards.
Key Levels to Watch
According to Ponmudi R, CEO of Enrich Money, the Nifty 50 is trading in a narrow consolidation range, with 26,000 serving as a crucial psychological and technical support. A break below this level could trigger a corrective move towards the 25,900–25,800 zone, aligning with recent swing lows and the 50-day moving average. Immediate resistance is at 26,160, while the 26,250–26,300 zone remains a strong supply area.
FII and DII Activity
On December 26, foreign institutional investors (FIIs) sold shares worth ₹318 crore, while domestic institutional investors (DIIs) bought shares worth ₹1,773 crore. So far this month, FIIs have sold shares worth ₹14,734 crore.
Other Important Factors
Investors are closely monitoring industrial production data and developments in the Ukraine war negotiations. Trading volumes are expected to remain thin due to the Christmas and New Year holidays. Silver prices experienced volatility, climbing above $80 per ounce before declining, while gold prices also eased after reaching new highs.
In summary, the Indian stock market is expected to open flat to slightly positive on December 29. Market participants should keep an eye on global cues, key support and resistance levels, and FII/DII activity.
