IIP data to FOMC minutes: Top five triggers for Indian stock market this week

Stock market next week: The Indian equity market closed in the red on Friday, December 26, as investors continued to book profits in the absence of fresh triggers and amid mixed global signals.

The Sensex declined 367 points, or 0.43%, to finish at 85,041.45, while the Nifty 50 fell 100 points, or 0.38%, to close at 26,042.30. Broader markets also weakened, with the BSE Midcap index edging down 0.18% and the Smallcap index sliding 0.34%.

“Markets ended the holiday-shortened week with modest gains, extending the ongoing consolidation phase. After a strong start, benchmark indices remained subdued in subsequent sessions amid mixed global cues and thin year-end volumes. The Nifty settled at 26,042.30, while the Sensex closed at 85,041, reflecting a cautious yet resilient undertone,” said Ajit Mishra, SVP, Research, Religare Broking Ltd.

Stock market outlook next week

On the stock market outlook for next week, Mishra added that the markets are likely to stay range-bound in the near term, with liquidity conditions remaining muted and key macro cues awaited.

“Investors may continue to adopt a buy-on-dips strategy, focusing on large-cap stocks and select cyclicals offering relative value and stability. Traders are advised to remain stock- specific, trail stop-losses on profitable positions, and avoid aggressive leverage amid expected volatility around the expiry and data releases. A balanced approach with disciplined risk management remains crucial as markets enter the New Year,” Mishra added.

Top triggers for the Indian stock market

IIP data

The stock market investors will closely track India's industrial output data (IIP) for the month of November 2025 in the coming week. According to the Ministry of Statistics & Programme Implementation, the release of the Index for November 2025 will be on 29 December 2025.

The IIP growth rate for the month of October 2025 was 0.4 percent, which was 4.0 percent in the month of September 2025. The slow growth in the month was attributed to less working days because of several festivals in the month, including Dussehra, Dipawali and Chhath.

FOMC minutes

The U.S. Federal Reserve is set to publish the minutes of the Federal Open Market Committee’s regular meeting on December 31. In the December meeting, the Fed maintained its monetary policy easing by cutting the benchmark interest rate by 25 basis points to 3.75%.

Rupee vs US Dollar

The rupee weakened by 19 paise to settle at 89.90 against the US dollar on Friday, weighed down by a decline in domestic equities and continued foreign fund outflows. In the interbank foreign exchange market, it opened at 89.84, slipped to an intra-day low of 89.94, and at one point was down 23 paise from its previous close.

However, the currency recovered part of its losses by the end of the session, closing at 89.90, still 19 paise lower than the previous close.

“The rupee traded weaker near 89.80, down about 0.07%, as the absence of FII buying kept equity markets under pressure. The currency remained volatile through the week in a 89.60–89.90 band. Rising bullion and non-agricultural commodity prices have added pressure on the rupee due to higher import costs. Next week, cues will come from commodity trends, FII activity and the Fed’s meeting minutes, with the rupee seen in a 89.45–90.25 range,” said Jateen Trivedi, VP Research Analyst - Commodity and Currency, LKP Securities.

FII Activity

Foreign Institutional Investors (FIIs) are set to close 2025 with an unprecedented withdrawal from Indian equities, registering the largest-ever net outflows in the Indian market. As of December 27, FIIs have offloaded shares worth ₹22,130 crore via the exchanges, pushing total equity sales for the calendar year 2025 to ₹2,31,990 crore.

“The sustained selling by FIIs have contributed significantly to the sharp depreciation in INR this year. Improvement in fundamentals are likely to attract net FII inflows in 2026. Robust GDP growth and prospects of improvement in corporate earnings in 2026 augur well for positive FII flows in 2026,” said VK Vijayakumar, Chief Investment Strategist, Geojit Investments Limited.

Bullions

Gold prices hit an all-time high during early Asian hours on Friday, supported by heightened safe-haven buying and growing expectations of additional interest rate cuts by the U.S. Federal Reserve.

Spot gold climbed 0.5% to $4,501.44 per ounce at 0209 GMT, after briefly touching a record high of $4,530.60 earlier in the session.

Silver also rallied sharply, crossing the $75-per-ounce mark for the first time, driven by robust industrial and investment demand, ongoing supply constraints, its recent classification as a U.S. critical mineral, and momentum-led buying.

So far this year, spot silver has surged more than 150%, far outpacing gold’s gain of over 70%.

Technical Outlook

Nifty 50

According to Ajit Mishra of Religare Broking, the index continues to consolidate near record highs, indicating a healthy pause within the broader uptrend.

“Immediate support is placed in the 25,500–25,700 zone, while resistance is seen near 26,200 initially. A sustained breakout could open the path toward the 26,500–26,700 zone,” Mishra said.

Bank Nifty

The banking index remains range-bound in line with the broader market, with support around 58,500 and resistance near 59,500.

“A decisive breakout or breakdown could trigger the next directional move. On the downside, 57,600 is expected to act as a major support, while a breakout could lead to an upside target near 60,500,” Mishra added.

Disclaimer: This story is for educational purposes only. Please consult with an investment advisor before making any investment decisions.