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Informist, Wednesday, Dec. 10, 2025

 

By Anshul Choudhary

 

MUMBAI – The benchmark indices are likely to be under selling pressure this week as investors look to take profits amid high stock valuations and the continued delay in the India-US trade deal. The US Federal Open Market Committee will announce its decision on interest rates at 0030 IST Thursday, which may trigger a sharp reaction later in the day.

 

Analysts are not expecting any major impact in the market if the FOMC decides to cut interest rates by 25 basis points, which is largely expected. However, US Federal Reserve Chair Jerome Powell's comments on the labour market and interest rate trajectory may move the market.

 

Amid risk-off sentiment ahead of the FOMC outcome, the Nifty 50 is down 1.6% this week at 25758.00 points, falling below its immediate support level. Technical analysts expect the Nifty 50 to fall to 25700-25600 points in the upcoming sessions. The index is likely to face resistance at 26000 points in case there is some buying after the three-day fall.

 

"A reasonable negative candle was formed on the daily chart with long upper shadow," Nagaraj Shetti, senior technical analyst at HDFC Securities, said in a note. "Technically this market action indicates an inability of bulls to sustain the bounce and also sell on rise opportunity."

 

Economic growth in India is at risk from the tariffs imposed by the US on Indian goods, analysts said. "Tariff-driven front-loading temporarily boosted exports, but these effects have started to reverse," Kotak Securities said in its market outlook for 2026. 

 

Having said that, analysts remain largely convinced that a trade deal between India and the US will be announced soon and tariffs against India will come down. Kotak Securities expects the Nifty 50 to rise to 29120 points by the end of 2026, indicating returns of 13% from the current level.

 

A trade deal could be the trigger the market needs for significant returns as other concerns around growth have eased. The government's decision to cut goods and service taxes has improved outlook for consumption and the risk of significant downgrades in earnings estimate has also come down, Kotak Securities said.

 

Market participants are still divided over valuations with some pointing to relatively better valuations compared with last year. However, there are other analysts who say absolute valuations are still high and returns will remain muted. "I will be surprised if we (Nifty 50 returns) exceed the earnings growth... around 10% returns would be good, I think," Unmesh Sharma, head of institutional equities at HDFC Securities, said.  End

 

Edited by Rajeev Pai

 

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