Market outlook for the week (08-Dec to 12-Dec)

11 Dec 2025 , 10:27 AM

SECTORAL STORY FOR WEEK TO DECEMBER 05, 2025 

The week to December 05, 2025 saw Nifty and Sensex close absolutely flat, thanks to a late recovery on Friday, after the RBI policy. During the week, FPIs sold equities worth $1.32 billion. Rupee fell to as low as ₹90.46/$, before the RBI intervened in support. 

Sectoral  Index	Weekly  Returns	Index  (05-Dec)	Index  (28-Nov)
Nifty IT	3.47%	38,703.65	37,405.50
Nifty India Digital	2.31%	9,637.10	9,419.70
Nifty Automobiles	0.59%	27,939.10	27,774.60
Nifty Metals	0.46%	10,340.35	10,293.05
Nifty Private Banks	0.25%	28,862.30	28,789.40
Nifty Banks	0.04%	59,777.20	59,752.70
Nifty Non-Banks	-0.02%	32,179.25	32,186.00
Nifty Mobility	-0.59%	23,105.85	23,241.95
Nifty CPSE	-0.59%	6,324.20	6,361.85
Nifty MNC	-0.65%	30,196.30	30,392.45
Nifty FMCG	-0.71%	55,202.85	55,595.80
Nifty Chemicals	-0.99%	28,515.60	28,800.75
Nifty Oil & Gas	-1.07%	11,905.60	12,034.40
Nifty Realty	-1.11%	893.15	903.15
Nifty Healthcare	-1.16%	14,856.30	15,031.25
Nifty Infrastructure	-1.17%	9,540.65	9,653.90
Nifty PSU Banks	-1.56%	8,381.75	8,514.40
Nifty Capital Markets	-2.09%	4,682.15	4,782.10
Nifty India Defence	-2.62%	7,800.30	8,009.85
Nifty Consumer Durables	-3.19%	36,674.75	37,881.60

Data Source: NSE 

For the week, 6 sectors gave positive returns, while 14 gave negative returns. IT, Digital, Automobiles, and Metals recorded best gains. On the downside; Consumer Durables, Defence, and Capital Markets were under stress. Only 2 sectors gained over 2% this week. 

Here is a quick look at the story behind the big gainers and losers this week. On the upside, the rally was driven by expectations of higher tech spending with bigger AI allocations, festive sales, and China recovery. On the downside, defence and consumer durables are seeing sharp unwinding. Defence continues to feel the strain of the Tejas crash at Dubai. 

Average returns of the 20 sectors stood at -0.52%. The top 5 sectors delivered 1.42% returns, while top 10 sectors gave returns of 0.53%. Bottom 10 sectors delivered -1.57%, showing substantial pressure on the downside. Going ahead, key triggers in the coming week will be reaction to RBI policy, Fed rate action, and India CPI inflation. 

WEEK THAT WAS; THE GOOD, THE BAD, THE UGLY 

On the positive side, the RBI announced a 25-bps rate cut in the December policy. In addition, the GDP growth estimate for FY26 was upped by 50 bps to 7.3%, while the CPI inflation estimate for FY26 was lowered by 60 bps to 2.0%. The current account deficit for H1FY26 came in sharply lower at 0.8%, although Q3 and Q4 may be pressure points. 

On the downside, the IIP disappointed at 0.4% for October 2025, due to the tariff pressure. The rupee cracked sharply to a low of ₹90.46/$ during the week, before RBI support came in. This led to FPIs net selling $1.32 Billion in equities. Also, the overhang of low nominal GDP growth and high fiscal deficit has kept the markets under pressure. 

STOCK MARKET TRIGGERS FOR COMING WEEK TO DECEMBER 12, 2025 

Here are key triggers that will influence stock markets next week. 

• The MOSPI will announce CPI inflation for November next week. After touching an all-time low of 0.25% in October, the base effect could push the inflation slightly higher this month. However, that is unlikely to impact the dovish stance of the RBI.

• US Fed will announce the December monetary policy, with strong expectations of a 25-bps rate cut. While the FOMC continues to be divided on the issue, the latest PCE inflation rate of 2.8% for September 2025 will be an overhang on the FOMC decisions.

• The December Fed policy will also see the quarterly macro estimates for the next two years being updated. Broadly, the unemployment rate may be upped, while the inflation level may also be upped. Rate cuts may be further back-ended to 2027.

• It will be another busy week for the IPO market with 4 IPOs raising ₹3,735 Crore on the IPO mainboard. In addition, Meesho, Aequs, and Vidya Wires will also list this week. Meesho and Aequs saw strong participation from retail and HNI/NII also.

• Key global data points. Factory Orders, Consumer Inflation Expectations, Non-Farm Productivity, WASDE Report, JOLTS, and API crude stocks (US). Eurogroup Meetings, Lagarde Speak (EU); GDP, Current Account, IIP (Japan); MPC Speak, GDP, IIP (UK); and Trade, CPI Inflation, and New Loans (China). 

What does this mean for Nifty and Sensex levels in the coming week to December 12, 2025. 

PARTING THOUGHTS ON NIFTY AND SENSEX LEVELS 

VIX fell sharply from 11.62 levels to 10.32 levels, as global macros stabilized in the week. The fear factor appears to be waning over the last two weeks. 

• Nifty closed the week at 26,186 Spot. Nifty has immediate support at 26,047 and major support at 25,830. Immediate resistance is at 26,264 and later at 26,482. Nifty remains a Long Trade, unless it breaks below 25,902 with volumes. Shorts only below that!

• Sensex closed the week at 85,712 Spot. Sensex has immediate support at 85,261 and major support at 84,543. Immediate resistance is at 85,980 and later at 86,699. Sensex remains a Long Trade, till it breaks below 84,810 with volumes. Shorts only below that! 

The focus next week will be on the impact of RBI dovishness on the markets, which is likely to be positive. However, sentiments will also be determined by the Fed policy statement, FOMC quarterly macro projections, and the India inflation data!