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Informist, Monday, Dec. 8, 2025

 

By Gopika Balasubramanium

 

MUMBAI – India's headline indices are likely to remain under selling pressure as investors have added short positions in the derivatives segment. Analysts expect the indices to be volatile Tuesday on the back of the expiry of weekly derivatives contracts of the Nifty 50 index. A weak rupee continues to worry investors amid a sustained sell-off by foreign investors. Analysts also said investors are cautious ahead of the US Federal Reserve's monetary policy decision later this week.  

 

"Overall, we expect the markets to remain volatile ahead of the US Fed policy outcome, with commentary on the interest-rate trajectory shaping global investor sentiment," Siddharth Khemka, head of research – wealth management at Motilal Oswal Financial Services, said. "On the domestic front, factors such as INR-USD movement, FII (foreign institutional investors) flow trends and the secondary-market liquidity environment amid elevated investor participation in primary markets are likely to influence the near-term market trajectory," Khemka said.

 

Globally, investors are cautious ahead of the US Federal Open Market Committee's decision. So far in 2025, the US FOMC has cut the federal funds target range by 50 basis points to 3.75-4.00%. "You cannot reduce interest rates if your inflation (in the US ) keeps rising, especially amid tariff rates, but then political pressure is very high," Ankit Dharamshi, fund manager at RNM India, said. "So, they (US FOMC) could do one rate cut due to the kind of pressure the administration is putting," he added. "But I think Fed, again, on its own, is not convinced at this point in time to do a rate cut," Dharamshi said.

 

There is volatility across global equity markets amid rising yields of Japanese bonds. "Volatility increased as Japanese bond yields climbed to multi-year highs, heightening worries about a possible unwinding of the yen carry trade," Bajaj Broking Research said. 

 

Monday, the Nifty 50 closed at 25960.55 points, down 225.90 points or 0.9%. During the session, the 50-stock index fell to 25892.25  points, breaking the crucial support of 25900 points. The BSE Sensex closed at 85102.69 points, down 609.68 points or 0.7%. Going ahead, if the Nifty 50 falls below Monday's low of 25892 points, it will extend the fall towards 25750-25700 points, Bajaj Broking said. However, holding above Monday's low will signal consolidation in the range between 25900 and 26200 points in the coming sessions, it said.  End

 

Edited by Saji George Titus

 

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