Equities Slide as Global Caution, FII Outflows Weigh on Sentiment

An end-of-day recap of all that transpired in the Indian markets, highlighting the major price movements and the factors driving them

Bombay Stock Exchange Building From Dalal Street in Mumbai

Amey Bane/iStockphoto.com

By Dehuti Jani

Dehuti Jani is an experienced project manager who also works as an independent financial journalist.

December 8, 2025 at 11:51 AM IST

Indian equities fell sharply on Monday, mirroring a cautious global setup ahead of the US Federal Reserve’s policy meeting later this week. The Nifty50 dropped 0.86% to 25,960.55, while the Sensex declined 0.71% to 85,102.69, marking their worst single-day fall since September 26. Heavy foreign outflows intensified the pressure, with FIIs selling over $1 billion of Indian equities so far in December, taking year-to-date withdrawals close to $18 billion, according to NSDL data. The session also unfolded amid a crowded week of IPO activity and lingering uncertainty over India–US trade negotiations.

Market breadth weakened significantly, with 15 of 16 major sectoral indices declining. Nifty Realty led the fall, down 3.5%, followed by steep losses in PSU Banks, Media, Metals, Financials, Auto, FMCG and Consumer-linked sectors. IT showed the smallest decline at 0.29%, offering the only semblance of stability. The broader markets mirrored the sell-off, with the Nifty MidCap 100 down 1.83% and the Nifty SmallCap 100 tumbling 2.6%. On the BSE, Bharat Electronics, Eternal, Trent, Tata Steel and Bajaj Finance were among the top laggards, slipping as much as 4.8%, while Tech Mahindra was the lone Sensex gainer, rising 1.3%.

Top Movers of the Day

Real estate stocks came under pressure, falling up to 4% despite the RBI’s 25 bps repo rate cut on Friday. DLF, Godrej Properties, Prestige Estates and Anant Raj declined around 4%, while Macrotech Developers (Lodha), Sobha, Brigade Enterprises and Oberoi Realty slipped 1–3%. Analysts at YES Securities noted that new launches fell 34% YoY in October 2025, with unit launches at a multi-month low, signalling cooling momentum in the property cycle.

IndiGo continued to face intense selling pressure, dropping another 6.9%, with the stock hitting ₹5,001 intraday. The airline has now lost ₹340 billion in market value this month amid widespread flight cancellations and operational disruptions. Analysts caution the stock may fall toward ₹4,000 if earnings are hit over the next two quarters.

Kesoram Industries surged 20% after Frontier Warehousing acquired a 42.8% controlling stake via a block deal, marking the Birla family’s complete exit following the earlier demerger of its cement division into UltraTech.

Suzlon Energy rose up to 2.5% to ₹53 after ICICI Securities and Motilal Oswal reiterated bullish views, highlighting improving growth levers and a supportive demand outlook for renewables.

Whirlpool India slipped over 2% after talks for a $1-billion stake sale to Advent collapsed, dampening sentiment around the company’s strategic future.

Electronics manufacturing stocks Kaynes Technology and PG Electroplast tumbled up to 11%, extending Friday’s sharp decline. Kaynes has now fallen 27% over three sessions after admitting to lapses in disclosing certain related-party transactions in standalone statements, though the company clarified these were compliant under consolidated Ind-AS norms. Investor concerns over governance and working capital remained elevated.

Reliance Power fell over 5% after the Enforcement Directorate filed a supplementary prosecution complaint against the company and its subsidiaries. The stock has now declined for the seventh straight session.

In pharma, Dr Reddy’s Laboratories announced an exclusive licensing deal with Australia’s Immutep for the cancer therapy eftilagimod alfa, involving a $20-million upfront payment and up to $349.5 million in milestones. Despite the strategic partnership, shares eased 0.71% to ₹1,266.10 in intraday trade. Meanwhile, the IPO of Corona Remedies saw a subdued start on Day 1. The ₹655.37-crore issue is entirely an OFS of 6.2 million shares by promoters and existing holders.

Futures & Options
Nifty December 2025 futures closed at 26,050.10, trading at an 89.55-point premium to the Nifty’s cash close of 25,960.55, which fell 0.86% on the day. Volatility spiked, with India VIX jumping 7.85% to 11.13, reflecting heightened caution amid broad market weakness. InterGlobe Aviation (IndiGo), Reliance Industries and HDFC Bank were the most actively traded stock futures as the market moved deeper into the December 2025 series, set to expire on 30 December 2025.

Bonds
Indian government bond yields ended higher on Monday as attention shifted to the US Federal Reserve’s upcoming policy decision. After slipping about 3 basis points last week, the benchmark 6.33% 2035 yield rebounded above the 6.50% mark, hovering around 6.51% intraday. Trading remained tight following the RBI’s 25 bps repo rate cut to 5.25% and a liquidity boost, which together have delivered 125 bps of easing in 2025. The benchmark 10-year yield closed at 6.5342%, up from 6.5166% on Friday, as markets reassessed the near-term rate trajectory amid global policy uncertainty.

Forex
The rupee weakened on Monday, closing at 90.07 per US dollar, down 0.1%, as a decline in domestic equities and softness in Asian currencies added pressure while the currency settled into a new, weaker trading range. Traders pointed to likely portfolio outflows weighing on sentiment, though a pick-up in exporter hedging and intermittent dollar sales from state-run banks helped moderate the rupee’s decline.

Crypto
Crypto markets traded higher today, rising 1.15% over the past 24 hours as optimism around a potential US Federal Reserve rate cut lifted sentiment. Bitcoin gained 1.86% to $91,304, helping the market rebound from an almost 11% monthly decline. Ethereum also firmed 1% to $3,117.47 in early trade, supported by improving liquidity conditions.

US Stock Futures
US stock futures rose on Monday as markets entered a pivotal week marked by the Federal Reserve’s final policy meeting of 2025. Expectations for a rate cut are nearing their strongest levels of the year, prompting cautious optimism among traders ahead of Wednesday’s decision. S&P 500 futures rose 0.2%, Nasdaq 100 futures gained 0.3%, extending a four-day winning streak, while Dow futures traded just above the flatline in early trade.

US Treasury Notes
US Treasury yields were mixed on Monday, with the 10-year rising to around 4.15%, touching a two-week high as markets reassessed the Federal Reserve’s rate path for 2026. Shorter maturities also reflected this cautious repricing, with the 5-year yield near 3.73% and the 2-year around 3.58%. A rebound in the Michigan consumer sentiment index helped temper concerns over soft hiring and elevated living costs, adding to the day’s upward bias in yields as investors weighed the resilience of household demand alongside forthcoming Fed signals.

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