Sensex, Nifty Seen Lower At Open

(RTTNews) - Indian shares look set to open lower on Wednesday, the first trading session of New Year 2025, due to ongoing concerns about a firmer dollar and elevated U.S. Treasury yields.

That said, overall losses may remain capped somewhat after the release of positive macro data.

India's fiscal deficit narrowed to Rs 8.47 lakh crore in April-November 2024 period year-on-year, while output of the core infrastructure sector rose to a four-month high in November, separate reports showed.

Trading volumes are likely to remain thin as world markets remain shut for the New Year holiday.

Benchmark indexes Sensex and Nifty recovered from early losses to end little changed with a negative bias on Tuesday.

The rupee fell by 13 paise to close at a fresh record low of 85.65 against the greenback, ending the year with a 3 percent loss and marking its seventh consecutive year of decline due to relentless foreign fund outflows.

FIIs sold shares worth Rs 4,645 crores on a net basis Tuesday, while domestic financial institutions bought shares to the extent of Rs. 4,547 crores, according to provisional data from NSE.

Indian benchmark indexes Sensex and Nifty posted annual gains of 8.16 percent and 8.80 percent, respectively, with record highs achieved on September 27.

Asian markets, including China, Japan, Australia, New Zealand, Taiwan, Hong Kong and South Korea remain closed today for the New Year 2025 holiday.

The 10-year U.S. yield gained 3.4 basis points (bps) to 4.579 percent on Tuesday in thin trade and ended the year up by more than 60 bps, posting its best annual gain in two years.

Crude oil prices ended higher on Tuesday, but ended 2024 with a 3 percent loss, slipping for a second straight year amid persisting concerns about the outlook for global oil demand due to weak Chinese growth and uncertainty about interest-rate trajectory.

Gold delivered one of its best performances in a decade in 2024, recording an annual growth of 26 percent fueled by central bank purchases and heightened geopolitical tensions.

U.S. stocks ended lower overnight but logged strong annual gains led by big tech stocks exposed to AI.

While the Dow finished marginally lower, the S&P 500 and the Nasdaq Composite dipped 0.4 percent and 0.9 percent, respectively to extend loses for a fourth consecutive session as yields remained elevated on expectations of higher interest rates.

The S&P 500 rallied 23 percent in 2024, rising for the fifth time in six years and ending up by more than 20 pe cent for the second year in a row. The Nasdaq soared by nearly 30 percent and the Dow surged 13 percent for the year.

European stocks advanced on Tuesday, with several markets shut on New Year's Eve and shortened sessions in London and Paris.

The pan European STOXX 600 gained half a percent. France's CAC 40 climbed 0.9 percent and the U.K.'s FTSE 100 added 0.6 percent while the German market was closed.