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The Indian stock market is poised for a stronger start on Friday, December 19, with benchmarks Sensex and Nifty 50 expected to open higher after four consecutive sessions of losses. Sentiment has improved sharply following positive global cues, as Asian markets tracked gains on Wall Street where cooling US inflation strengthened expectations of US Federal Reserve rate cuts and eased tech jitters lifted equities.

Early indications from Gift Nifty point to a firm opening for domestic benchmarks. Gift Nifty was trading near 25,933, up 60 points or 0.236% from the previous close of Nifty futures, signalling a recovery-driven start to the trading day.

The Indian stock market benchmarks — the Sensex and the Nifty 50 — ended largely flat with a mild negative bias on Thursday, December 18, as the absence of fresh catalysts kept investor sentiment subdued. The Sensex slipped 78 points, or 0.09%, to close at 84,481.81, while the Nifty 50 eased 3 points, or 0.01%, to finish at 25,815.55.

"Domestic equities navigated a volatile session amid subdued global cues, with large-cap stocks lagging behind mid- and small-cap counterparts. After three consecutive declines, early gains were supported by value buying and a rupee recovery aided by central bank intervention. However, lingering uncertainty over a potential U.S.–India trade deal dampened sentiment, prompting profit-booking later in the day. Sector-wise, IT and financial services attracted investor interest, while auto, oil & gas, chemicals, and pharma witnessed notable weakness. Looking ahead, markets will focus on U.S. core inflation and jobless claims data, alongside interest rate decisions from the BoE, ECB, and Bank of Japan, for clearer directional cues," Vinod Nair, Head of Research, Geojit Investments Limited.

Asian equities advanced on Friday as cooling US inflation data strengthened expectations of Federal Reserve rate cuts and easing tech concerns lifted sentiment on Wall Street. Stocks in Japan and Australia gained alongside Hong Kong equity futures after the S&P 500 rose 0.8% and the Nasdaq 100 rallied 1.5% in the previous session. As of 9:18 a.m. Tokyo time, S&P 500 futures were steady, while Hang Seng futures climbed 0.6%, Japan’s Topix added 0.5% and Australia’s S&P/ASX 200 also gained 0.5%. Euro Stoxx 50 futures rose 1%, reflecting broad optimism across global markets.

The trends on Gift Nifty indicate a muted start for the Indian benchmark index. The Gift Nifty was trading near 25,933 level, up 60 points or 0.23% from the Nifty futures’ previous close.

Wall Street’s major indexes finished higher on Thursday after softer-than-expected US inflation strengthened hopes of upcoming Federal Reserve interest-rate cuts, while a strong outlook from chipmaker Micron boosted optimism around AI-driven demand. The latest Consumer Price Index data showed that prices rose less than expected in the year to November. However, the Labor Department’s Bureau of Labor Statistics did not release month-to-month CPI changes, as the 43-day government shutdown had halted the collection of October data.

The Dow Jones Industrial Average rose 65.88 points, or 0.14%, to 47,951.85, the S&P 500 gained 53.33 points, or 0.79%, to 6,774.76 and the Nasdaq Composite gained 313.04 points, or 1.38%, to 23,006.36.

US consumer inflation eased more than expected in November, according to delayed government data released Thursday, marking a slowdown even as price pressures remained elevated compared with earlier in the year before President Donald Trump's tariffs filtered through the economy. The Department of Labor reported that the Consumer Price Index (CPI) rose 2.7% year-on-year in November, well below economists’ expectations of a 3.1% increase. The figure was also softer than the 3.0% rise recorded in September — the most recent month with complete data before the prolonged government shutdown disrupted reporting.

Inflation has edged higher through 2025 as Trump's new tariffs on imports from major trading partners raised input costs for businesses, with many companies warning of increased operational pressures.

The Bank of England (BoE) on Thursday lowered its key interest rate by 25 basis points to 3.75%, responding to faster-than-expected cooling in UK inflation and persistent worries over economic weakness. The move, which came after the central bank’s scheduled policy meeting, was widely anticipated by markets and precedes the European Central Bank’s (ECB) rate decision due later today. The Monetary Policy Committee voted 5-4 to lower the benchmark rate. It was the first reduction since August after the nine-member panel skipped moves at the previous two decisions.

The European Central Bank (ECB) left interest rates unchanged for a fourth consecutive meeting on Thursday, as inflation remains near target and the euro zone continues to absorb global economic shocks.

The central bank maintained the deposit rate at 2%, in line with expectations from all economists surveyed by Bloomberg. Policymakers again refrained from offering any forward guidance, reiterating that decisions will be taken “meeting by meeting” based strictly on incoming economic data. Alongside the policy announcement, the ECB released updated projections showing stronger economic growth ahead and inflation returning to the 2% target in 2028, after undershooting that level over the next two years.

Japan’s key inflation gauge stayed at 3% for a second month, signaling sustained price pressure hours before the Bank of Japan is widely expected to boost borrowing costs to the highest level in three decades. The overall gauge increased 2.9%. The data came hours before the central bank was expected to raise its benchmark interest rate to 0.75%.

Bond markets reacted cautiously to the softer US CPI print, with 10-year Treasury yields steady at 4.126%, below the recent 3.5-month peak of 4.209%. Japan’s 10-year yield held at 1.980%, matching its highest level in 18 years.

In the UK, gilts weakened after the Bank of England cut rates in a narrow 5–4 vote and signalled slower future easing, pushing expectations for the next cut to June. The brief hawkish shift lifted the pound and euro, but both soon retreated, leaving sterling at $1.3378 and the euro at $1.1725.

The dollar was little changed against the yen at 155.60, remaining within its recent 154.34–156.96 range.

Gold prices hovered near a record high, after slower-than-expected inflation in the US supported bets for more interest-rate cuts. Bullion was near $4,335 an ounce, and on track for a second weekly gain. Gold has also been supported this week by escalating tensions in Venezuela, where Trump ordered a blockade of all sanctioned oil tankers. Gold rose 0.1% to $4,335.15 an ounce as of 7:20 a.m. in Singapore, and is up 0.8% for the week. It hit an all-time high above $4,381 in October. Silver advanced 0.1% to $65.55, near a record of $66.89 set on Wednesday. Platinum — which traded on Thursday at its highest since 2008 — was steady, while palladium climbed.

Crude oil price is on track for a second straight weekly decline as mounting concerns over a growing supply glut overshadowed the risk of geopolitical disruptions. West Texas Intermediate hovered near $56 a barrel, down more than 2% for the week, while Brent slipped below $60 on Thursday. Crude has already fallen about 20% this year as OPEC restored supply faster than expected, output rose elsewhere, and demand remained weak, though tensions involving Russia and Venezuela have limited deeper losses.

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