After a sharp sell-off on 8 December, benchmark indices Sensex and Nifty are likely to face volatility, with profit booking and FII outflows continuing to weigh on sentiment.
Stock Market Outlook Today, 9 December 2025 Ahead of US Federal Reserve Meeting
On Monday, the Sensex tumbled over 610 points to close at 85,103 (-0.7%), while the Nifty50 shed 226 points to settle at 25,961 (-0.9%), reflecting widespread caution ahead of the US Federal Reserve's upcoming policy decision.
"The market-wide sell-off was driven by cautious sentiment ahead of the Fed rate decision, continuous FII selling, and widespread profit booking across the broader market," noted Siddhartha Khemka. Nifty Midcap and Smallcap indices declined sharply by 1.8% and 2.6% respectively.
Smallcap and Midcap Stocks Crash; Know Why Stock Market Is Down?
Sectorally, all indices ended in the red, with Nifty Realty (-3.5%) and Nifty PSU Bank (-2.8%) emerging as the top losers, while the Nifty IT index demonstrated relative resilience, posting a marginal loss of 0.3%.
Bajaj Broking Research echoed the cautious tone, highlighting that the Nifty slipped below the 26,000 mark, despite strong domestic growth data and the RBI's recent rate cut. "Even with domestic support, near-term sentiment remains weighed down by global rate worries, persistent FII selling, and continued pressure on the rupee," the report stated. Rising Japanese bond yields to multi-year highs also heightened fears of an unwinding of the yen carry trade, contributing to market volatility.
Meesho IPO Allotment Along With Vidya Wires and Aequs IPO in Focus
Primary markets continue to see activity, with allotments for Meesho, Vidya Wires and Aequs IPOs expected to be announced today, while four new IPOs-including the Rs 10,600 crore ICICI Prudential AMC issue-opened for subscription this week.
India and Russia Trade
On the international front, India and Russia recently signed 16 agreements across defence, trade, economy, and healthcare during the 23rd India-Russia Annual Summit in New Delhi, which may provide some support to domestic trade sentiment.
Nifty Prediction Today; Nifty50 Tanks Below 26,000
According to Bajaj Broking Research, "The Nifty formed a sizable bear candle with a lower high and a lower low, signaling a lack of follow-through to Friday's strong pullback as the index closed below the 26,000 levels."
Analysts suggest that if the Nifty breaks below Monday's low of 25,890, the decline could extend towards 25,750-25,700. Conversely, holding above 25,890 may lead to consolidation in the 26,200-25,900 range ahead of the US FOMC rate decision. Key support levels are seen at 25,900-25,700, aligning with the November 12 bullish gap, the 50-day EMA, and the lower band of the rising channel.
"The index managed to hold the 25,890 level, which is the low of the weekly Hanging Man pattern. A firm break below 25,890 could lead to fresh selling pressure, with next major support at 25,500-25,300," Hrishikesh Yedve, AVP Technical and Derivative Research, Asit C. Mehta Investment Intermediates Ltd said.
On the upside, resistance is expected around 26,200 and 26,325, with any bounce towards 26,325 suggested as an opportunity for profit booking.
Bank Nifty Outlook on 9 December 2025
On the sectoral front, the Bank Nifty has formed a bearish candlestick with a long lower shadow, signaling weakness following the RBI monetary policy outcome. Analysts expect the index to consolidate in the 58,500-60,100 range. "Only a follow-through strength above last week's high of 60,114 will open further upside towards 60,400 and then 61,000 levels," Bajaj Broking noted. Key short-term support is placed at 58,200-58,600, which is seen as a confluence of recent lows and a major breakout area.
Report made by Harshika Yadav of goodreturns.in
Disclaimer
The views and recommendations expressed are solely those of the individual analysts or entities. All information is provided for informational and educational purposes only and should be independently verified from licensed financial advisors before making any investment decisions.
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