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Below the Quote on Weekly market outlook 26th Decmeber 2025 by Vinod Nair, Head of Research at Geojit Investments Ltd

"Indian equity markets ended the week in a positive terrain, buoyed by expectations of stronger domestic demand, a favourable liquidity outlook, and optimism over potential Fed policy easing in 2026. The holiday-shortened week opened with a bullish undertone; however, momentum tapered off as the days progressed. The year-end lull kept trading largely range-bound, with hopes for a Santa Claus rally diminishing amid the absence of fresh catalysts, limited progress in U.S.–India trade talks, and caution ahead of the upcoming earnings season. Sectoral trends were mixed, marked by selective profit booking across most segments, while metals, FMCG, and media stocks offered notable resilience.

Globally, elevated Japanese bond yields tempered risk appetite, even as robust U.S. GDP figures underscored the resilience of the world’s largest economy. On the domestic front, RBI’s liquidity interventions, such as open market operations and a USD/INR buy–sell swap, helped stabilize the rupee, though persistent FII outflows continued to weigh on sentiment. Meanwhile, gold advanced on safe-haven demand, while crude prices hovered near multi-year lows, though U.S. steps to tighten pressure on Venezuelan oil shipments could exert upward pressure in the near term.

Looking ahead, market sentiment is likely to stay cautious as investors brace for the upcoming earnings season while remaining attuned to global developments and currency movements. Key drivers will include progress in India–U.S. trade talks, rupee stability, FII trends, and movements in commodity prices. With year-end trading volumes expected to remain subdued, price action could be largely contained. Attention will also turn to next week’s data releases, including India’s industrial and manufacturing output figures, manufacturing PMI, and the U.S. FOMC minutes."

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