The Indian equity market is bracing for a cautious opening on Thursday, January 8, as indicated by mixed signals from Asian peers and early trends in the Gift Nifty futures. The domestic indices are poised to extend their recent losing streak, influenced by a complex web of global geopolitical tensions and sector-specific movements.
Market Recap and Immediate Triggers
On Wednesday, the benchmark indices closed in the red for the third consecutive session. The Sensex declined by 102 points, or 0.12%, to settle at 84,961.14. Similarly, the Nifty 50 dropped 38 points, or 0.14%, ending the day at 26,140.75. In a contrasting trend, broader market indices showed resilience, with the BSE Midcap and Smallcap indices gaining 0.47% and 0.12%, respectively.
Ajit Mishra, SVP of Research at Religare Broking, noted that markets remained subdued, stuck in a corrective phase with limited recovery attempts. He attributed the sentiment to mixed global cues, lingering geopolitical worries, and a lack of strong domestic triggers, leading to a stock-specific, wait-and-watch approach among investors.
Global Cues Setting the Tone
Asian markets presented a mixed picture early on Thursday. Japan's Nikkei 225 opened 0.46% lower, and the Topix index slipped 0.27%. South Korea's Kospi inched up 0.12%, while Australia's ASX/S&P 200 advanced 0.21%. Hong Kong's Hang Seng Index was indicated for a weaker start.
The key indicator for Indian markets, Gift Nifty, was trading at 26,184, down approximately 42 points or 0.16% from the previous close of Nifty futures, pointing towards a negative opening for the domestic indices.
On Wall Street, the rally snapped as the S&P 500 and Dow Jones Industrial Average ended lower. The Dow dropped sharply by 466 points, or about 0.9%. However, the tech-heavy Nasdaq Composite managed a marginal gain of nearly 0.2%, buoyed by a significant 2.4% surge in Alphabet's shares.
Commodities and Currency Movements
Crude oil prices edged higher, breaking a two-day fall. Brent crude futures rose 0.6% to $60.34 a barrel, and U.S. West Texas Intermediate gained 0.7% to $56.36. This increase followed a larger-than-expected drawdown in U.S. crude inventories, though analysts warn of a potential supply surplus in 2026.
In the precious metals space, gold prices slid more than 1% as investors booked profits from the recent rally. Spot gold was down 0.9% at $4,445.32 an ounce. Silver witnessed a steeper decline, falling 4.1% to $77.93 an ounce.
The U.S. dollar traded flat against major currencies like the yen and the euro. It gained slightly against the Swiss franc and the Japanese yen. Market attention remains on upcoming U.S. labor data, following a report showing job openings declined more than expected in November.
Geopolitical and Corporate Developments
Geopolitical developments added to the market's cautious mood. U.S. President Donald Trump's remarks on Venezuela and a subsequent clarification regarding Colombian President Gustavo Petro were in focus. Trump announced that Venezuela's interim authorities would transfer 30 million to 50 million barrels of sanctioned oil to the United States for sale at market prices, with proceeds intended to benefit both nations.
Furthermore, Venezuelan state oil company PDVSA confirmed it is in talks with the U.S. government regarding the sale of Venezuelan crude to American buyers, adding another layer to the evolving geopolitical and energy landscape.
As the trading day begins, Indian market participants are likely to navigate these mixed global signals, with specific attention on corporate earnings announcements and further macro developments for directional cues.
