Sensex and Nifty opened flat for the second consecutive session on December 10, as traders maintained a cautious stance ahead of crucial domestic and U.S. inflation data due later in the week. Investors also focused on commodity stocks amid expectations of Chinese stimulus measures.
At 9:20 AM IST, the Sensex was down 22.92 points, or 0.03 percent, at 81,485.5, and the Nifty slipped 1.9 points, or 0.01 percent, to 24,617. 1,783 shares advanced, 907 declined, and 105 remained unchanged.
Beijing announced plans to adopt "moderately loose monetary policies" next year and introduce steps to boost consumption, marking its first such policy shift in 14 years.
"We have to wait for Trump to be in office before reacting to the China stimulus expectations. This step by China could be a way to counter Trump's tariffs against the country. The last time such a measure was announced by China, the execution of it was quite underwhelming," Market veteran Sunil Subramanian told Moneycontrol.
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In a surprise move, Sanjay Malhotra was appointed as the new Governor of the Reserve Bank of India on December 9. Domestic brokerage Emkay Global said that the incoming Governor and MPC will encounter significantly different policy challenges and a shifting macroeconomic and global landscape as they step into CY25, compared to the scenario faced by the Das-led administration at the start of CY24.
Anticipation also builds around key inflation metrics—the US consumer price index (CPI) data, set to release on December 11 and the India CPI data on December 12—before the Federal Reserve's meeting on December 17-18. According to CME FedWatch, the probability of a 25-basis-point rate hike at the Fed's policy meeting stands at 86 percent.
"The Indian market is consolidating after a significant rally and is likely to trade in a range until the FOMC meeting. Post-inflation data (U.S. and India) and the FOMC, market volatility may ease, leading to a stable consolidation phase through the holiday season," said Ravi Diyora, Director of Research at Kunvarji Group.
Diyora further noted that third-quarter earnings are expected to outperform, driven by the waning impact of delayed monsoons. "Increased government and private capex, along with robust spending during the marriage season, are expected to support growth. Additionally, improved FII inflows and CRR cuts should bolster banking sector margins," he said.
Coming to sectoral indices, the energy and auto index declined while financial services and IT stocks witnessed gains.
Also Read | New RBI Governor Sanjay Malhotra's policy outlook on watch; rate cuts likely in early 2025
Amongst individual stocks, shares of Greaves Cotton rallied 10 percent as ace investor Vijay Kedia acquired 12 lakh shares through a block deal, representing a 0.52 percent equity in the company.
Glenmark Pharma shares gained over 2 percent after Phase 1 data for its cancer drug, ISB 2001, showed an 83 percent response rate in heavily pretreated patients.
The broader market mirrored the benchmarks, trading largely flat.
Subramanian said that the midcap and smallcap space is likely to outperform benchmarks for a few more months, as largecaps have already seen significant buying interest in recent weeks, and fund managers have liquidity constraints favouring midcap allocations.
Looking ahead, 24,800 is expected to act as a significant resistance level for Nifty, followed by 25,000, according to Hardik Matalia, Derivative Analyst at Choice Broking. "On the downside, immediate support is identified at 24,500, followed by 24,300. Traders are advised to adopt a buy-on-dips strategy as long as the index stays above 24,200. A strict stop-loss at 24,000 on a closing basis is recommended to manage risk," Matalia said.
On the Nifty 50, M&M, Bharti Airtel, ONGC, Adani Ports, and Trent were the biggest losers, dropping 1 percent, while Shriram Finance, Bajaj Finserv, Wipro, HCLTech, and Infosys emerged as top gainers, rising 1-2 percent each.
Disclaimer: The views and investment tips expressed by investment experts on Moneycontrol.com are their own and not those of the website or its management. Moneycontrol.com advises users to check with certified experts before taking any investment decisions.
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