The rupee’s persistent slide and the continued withdrawal of foreign institutional investors have cast a shadow over Indian markets, despite gains in the United States and Japan. Market participants believe the Reserve Bank of India and the government are not particularly uncomfortable with the rupee weakening further. This, combined with geopolitical concerns, has heightened anxiety across sectors.
Russian president Vladimir Putin’s visit—beginning today—has added another layer of uncertainty. Investors fear the trip could delay the long-pending India–US trade agreement. India is expected to sign more than two dozen agreements with Russia, including deals for fighter jets and missile-defence systems, but markets are not overly excited about these developments.
The RBI’s monetary policy committee began its meeting on December 4, with the final decision scheduled for December 5 at 10 am. Analysts estimate a 50% probability of a 0.25% cut in the repo rate.
Overnight trading in GIFT City mirrored the nervousness. Nifty derivatives closed on Wednesday at 26,097.50 and briefly climbed to 26,104 early this morning before easing back to 26,060—signalling another soft opening for Indian equities.
European indices moved in multiple directions on Wednesday. German and UK benchmarks closed lower, while France edged higher. Shares of Inditex, the owner of Spanish fashion label Zara, surged 10% after reporting unexpected growth. In contrast, Hugo Boss slumped 10% following a warning of weaker sales.
Talks in Moscow between Vladimir Putin and Donald Trump’s special envoy, Steve Witkoff, alongside Jared Kushner, reportedly failed. With no official statement from either side, markets chose not to react. However, global attention turned to Trump’s health after media reports claimed he appeared increasingly fatigued during discussions.
US stocks closed with mild gains. Traders expect November’s private-sector job losses—about 32,000 positions—to strengthen the case for a Federal Reserve rate cut. A report suggesting Microsoft had lowered its AI software sales targets pushed the stock down 2.5%, though the company dismissed the claim.
On Wednesday, the Dow Jones rose 408.44 points (0.86%) to 47,882.90, the S&P 500 gained 20.35 points (0.30%) to 6849.72, and the Nasdaq Composite climbed 40.42 points (0.17%) to 23,454.09.
US futures were marginally higher this morning: Dow up 0.14%, S&P 0.05%, and Nasdaq 0.03%.
Asian markets showed no uniform trend. Japan’s Nikkei advanced 1.2%, supported by a sharp rise in tech stocks, with SoftBank jumping 6%. Australia traded higher, while South Korea’s Kospi fell 0.50%. Hong Kong gained 0.20% and Chinese indices edged slightly lower.
The dollar’s rise past ₹90 rattled Indian equities. While a weaker rupee may boost exports, it also tends to accelerate foreign investor selling—a worry that weighed on the previous session. Domestic equities opened lower, slipped further, and later recovered to close with marginal losses. Gains in IT and private-sector banks cushioned the fall, while public-sector bank stocks plunged after the government dismissed reports of raising the foreign investment limit to 49%.
Market breadth remained weak. Mid-caps fell nearly 1%, and small-caps dropped about 0.75%. Traders believe the rupee will remain under pressure until India and the United States finalise a trade pact. The steep drop recorded a day before Putin’s visit underlined the sensitivity.
On Wednesday, foreign investors sold shares worth ₹3,206.92 crore, while domestic funds bought ₹4,730.41 crore.
Sensex slipped 31.46 points (0.04%) to 85,106.81, Nifty declined 46.20 points (0.18%) to 25,986. Bank Nifty rose 74.45 points (0.13%) to 59,348. Broader market indices closed sharply lower.
Traders see support for Nifty at 25,910 and 25,870, with resistance expected at 26,050 and 26,150.
IndiGo cancelled more than 300 flights over two days due to unexpected operational issues—the highest cancellation count in the airline’s history.
Japan’s JFE Steel and JSW Steel will set up a joint venture with an investment of ₹15,750 crore to take over Bhushan Power & Steel. The deal is expected to reduce JSW Steel’s debt by ₹37,000 crore. JFE currently holds a 15% stake in JSW Steel.
Reliance Retail appointed Jayendran Venugopal, formerly with Flipkart, as its new president and CEO.
Gold and silver prices have been swinging sharply as markets bet on a potential US rate cut next week. Gold fell from $4,243 per ounce to $4,193 before rebounding to $4,204.10. Early today, it climbed to $4,217 before slipping again. Kerala’s 22-carat gold price rose by ₹520 per sovereign to ₹95,760.
Silver surged to $59.02 per ounce before closing at $58.55. Spot prices later touched $58.71, with holiday-session rates briefly reaching $59.12.
Platinum traded at $1,670, palladium at $1,438 and rhodium at $7,800.
Central bank gold demand remains strong. In October, global central banks purchased 53 tonnes—36% higher than September. Purchases for the year up to October total 254 tonnes. Russia, however, sold three tonnes in October.
India remains the world’s largest silver buyer, having imported 1,700 tonnes in October—four times more than a year earlier. Prices that recently touched $59 may rise to $75, according to market chatter. Silver has doubled this year with a 100% rise—the sharpest increase since 1979. The gold-to-silver ratio has dropped to its lowest in four years.
Industrial metals traded mixed. Copper rose 1.36% to $11,436.15 per tonne, aluminium gained 0.62%, while nickel, lead and zinc declined. Tin moved higher.
Rubber prices abroad inched up 0.29% to 172.40 cents per kg. Cocoa rose 0.04% to $5,402.92 per tonne. Coffee fell 0.31%, tea remained unchanged and palm oil edged down 0.10%.
The dollar index fell 0.5% to 98.85 and later inched up to 98.96. The euro strengthened to $1.1661, the pound to $1.334, and the Japanese yen to 155.10 per dollar.
The US dollar eased to 7.06 Chinese yuan and 0.7997 Swiss franc. Bond yields climbed, with the US 10-year yield rising to 4.077%.
Crucially, the dollar-rupee rate closed at ₹90.20 after touching ₹90.29. Traders expect the rupee to move towards ₹91–92 unless foreign inflows stabilise or a trade deal with the United States materialises. The government and RBI appear comfortable with the weak rupee, with chief economic adviser Anantha Nageswaran remarking that he “does not lose sleep over the currency.” He expects a recovery next year.
China’s yuan strengthened to ₹12.77.
Crude rose after Ukraine peace talks fell through. Brent closed at $62.67 and later moved to $62.86. WTI traded at $59.17, while UAE’s Murban crude reached $64.55.
Natural gas surged to $4.996.
Cryptocurrencies saw sharp intraday gains. Bitcoin climbed above $93,400. Ether rose 8% to over $3,220 and Solana gained 5% to trade above $145.
