The Indian stock market benchmark indices, Sensex and Nifty 50, are expected to open flat on Monday, taking cues from muted overnight global market signals.

Asian equities started the week on a cautious note as investors evaluated weakening China–Japan relations, a busy schedule of central bank meetings, and the overall risk environment heading into the new year.

Domestically, markets will track several key triggers this week, including developments related to India–Russia economic agreements, the US Federal Reserve’s policy decision, India’s CPI inflation data, progress on the India–US trade deal, foreign institutional fund flows, movements in gold prices, geopolitical developments, and other major domestic and global economic indicators.

Market sentiment improved last week after the Reserve Bank of India cut interest rates by 25 basis points and proposed liquidity infusion of Rs 1.45 lakh crore through bond purchases and dollar–rupee swaps. This supportive policy stance helped benchmark indices close Friday’s session with strong gains.

Domestic Market Recap

On Friday, Indian indices closed in the green:

• Sensex surged by 447 points (0.52%) to close at 85,712.37
• Nifty 50 moved up by 153 points (0.59%) to settle at 26,186.45

Gift Nifty

Gift Nifty was trading near 26,326, around 9 points lower than the previous Nifty futures close, hinting at a muted start for Indian markets.

Overnight Wall Street Performance

The US stock market climbed close to its all-time high on Friday, led by modest gains across major indices. The S&P 500 advanced 0.2% to close just 0.3% below its record level set in October, after briefly surpassing the mark during intraday trade. The Dow Jones Industrial Average rose 104 points, or 0.2%, while the Nasdaq Composite gained 0.3%.

Crude Oil Prices

• Brent crude gained by 0.2% to $63.85/barrel
• US West Texas Intermediate (WTI) crude was trading 0.2% higher at $60.18/barrel

Overnight Major Global Events Driving Sentiment

1. Vladimir Putin’s India Visit: Russian President Vladimir Putin and Prime Minister Narendra Modi used their annual summit on Friday to announce a significant expansion of bilateral cooperation, with plans to diversify trade beyond oil and defence. The meeting took place as the United States renewed pressure on India to reconsider its long-standing relationship with Moscow amid efforts to broker a Ukraine peace deal. The summit also marked 25 years of the India–Russia Strategic Partnership, established during Putin’s first visit to India in 2000. With India accounting for less than 2% of Russia’s imports, both leaders set an ambitious target of achieving $100 billion in bilateral trade by the end of the decade.
2. India–US Trade Talks: US Under Secretary of State for Political Affairs Allison Hooker began a five-day visit to India on Sunday to strengthen strategic and economic ties. According to the US Embassy, the visit aligns with President Donald Trump’s priorities to deepen the US–India partnership and promote a free and open Indo-Pacific region.
3. US Inflation: The Personal Consumption Expenditures (PCE) Price Index, the Federal Reserve’s preferred measure of inflation, rose 0.3% in September, matching the increase recorded in August. On an annual basis, PCE inflation accelerated to 2.8%, marking its strongest year-on-year rise since April 2024 and following a 2.7% increase in the previous month.
4. US Consumer Spending: US consumers increased spending at a moderate pace in September after three consecutive months of strong gains. Consumer spending rose 0.3%, following a downwardly revised 0.5% increase in August.

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