Santa's Rally Hits Asia—Can India Catch Up?

• • Wall Street ended the week on a strong note Friday, led by a tech rally; the S&P 500 rose 0.9%, Nasdaq jumped 1.3%, and the Dow added 0.4%, with AI and semiconductor stocks like Nvidia, Palantir, and Micron driving gains. • The week closed with positive momentum for the S&P 500 and Nasdaq, while the Dow recorded a small weekly loss; the rally was supported by easing inflation concerns and a dovish Fed tone, boosting the “Santa Claus rally” hopes. • Top gainers included travel and cruise stocks like Carnival (up nearly 10%) and healthcare names like Moderna, while some defensive sectors like utilities and telecoms, along with Nike, faced selling pressure. • Indian ADRs showed modest overnight moves: ICICI Bank ADR around 29.92 (+0.77%), HDFC Bank ADR at 35.89, and Reliance ADR tracking broader sentiment, with no major fresh news. • Infosys ADR was in the spotlight after an unusual 50% price surge triggered a trading halt on Friday; the company clarified there were no material events, pointing to a technical glitch rather than fundamental news. • Asian markets are trading higher this morning: Japan’s Nikkei 225 is up 2%, Hong Kong’s Hang Seng is up 0.77%, and China’s Shanghai Composite is up 0.5%, reflecting broad risk-on sentiment. • The Gift Nifty futures are signaling a gap-up open for Indian markets, pointing to a positive start for Nifty 50 around the 26,170 level, indicating decent overnight buying interest. • Geopolitically, the Trump administration’s 50% tariffs on Indian goods have created headwinds for exports, especially in textiles and gems & jewellery, but November trade data shows a surprising 20% year-on-year export rebound, suggesting resilience. • There is still uncertainty around a formal India–US trade deal, but the export recovery indicates Indian exporters are adapting by finding alternate markets, limiting the worst-case tariff impact. • Domestically, the RBI recently cut the repo rate by 25 basis points to 5.25% with a dovish stance, opening the door for more easing if growth or inflation data weakens further. • FII flows have been cautiously positive, with net buying of around ₹600 crore on December 18, while DIIs remain strong buyers, showing domestic confidence in the market. • Key domestic watchpoints include RBI commentary, FII positioning ahead of year-end, and any impact from new petroleum rules that could benefit infrastructure and energy stocks. • There are no major IPOs launching today, but traders should keep an eye on any SEBI or exchange-level developments, especially around FnO and derivatives trading norms. • Technically, Nifty 50 is in a consolidation phase between 26,200 (resistance) and 25,700 (support), with immediate resistance near 26,050–26,100 and first support at 25,800–25,850. • A confirmed breakout above 26,100 could open the path toward 26,300–26,325, while a breakdown below 25,800 may test the key 25,700 level. • Bank Nifty is at 59,069 with resistance at 59,700–60,000 and support at 58,700 and the 50-day moving average near 58,470, making it a key gauge for banking sector strength. • Crude oil is trading around 60 dollars per barrel, with global supply relatively ample and prices holding in a 55–58 dollar range, keeping inflation and input cost pressures in check. • Gold is consolidating after a strong month, while silver has been the standout, surging past 67 dollars per ounce and hitting record highs near 67.45 dollars, driven by tight supply and strong investment demand. • The day plan for traders: the positive Asian and futures cues suggest a gap-up open, but Nifty is still in consolidation, so avoid aggressive fresh longs until a clear breakout above 26,050. • Focus on tactical intraday trades in financials and IT, using the 25,800–25,850 zone as a stop-loss area; if global markets hold strength, watch for a move toward 26,300. • If Asian markets reverse or US data disappoints, Nifty could test 25,800–25,700, so position sizing and risk management are crucial, especially in the lighter December volumes.