Sensex, Nifty Extend Slide as Fed Uncertainty and Trade Deal Worries Weigh

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

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By Dehuti Jani

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

December 9, 2025 at 11:39 AM IST

Indian equities extended their decline on Tuesday, with the Sensex and Nifty losing further ground as caution deepened ahead of the US Federal Reserve’s rate decision and ongoing uncertainty surrounding India–US trade talks. The Nifty50 slipped 0.47% to 25,839.65, while the Sensex fell 0.51% to 84,666.28, marking a second straight session of broad weakness. IT continued to drag sentiment, while PSU banks, realty, consumer durables, chemicals and select financial services outperformed on rotation into domestic and defensive themes. Healthcare, metals and energy lagged, reflecting a persistent risk-off tone.

Trade-related worries resurfaced after reports that US President Donald Trump may consider new tariffs on Indian rice, highlighting unresolved negotiations and adding to market nerves. The selloff intensified across the broader market, with several BSE 500 constituents - ACC, MGL, REC, PFC, Page Industries, IREDA and UBL, hitting fresh 52-week lows. Other notable names such as Tata Chemicals, Trent, Tejas Networks, Bata India, Balrampur Chini, Whirlpool, Praj Industries, SJVN, Crompton Greaves Consumer Electricals and Finolex Cables also slipped to yearly lows, while Bajaj Housing Finance, Ola Electric Mobility, Vedant Fashions and Afcons Infrastructure fell to all-time lows. Overall sentiment remained weak, with selective pockets of buying unable to offset the broader pressure.

Top Movers of the Day
AU Small Finance Bank hit a new high of ₹967.25, rising nearly 2% amid expectations of continued strong business momentum. The bank’s total assets have surged from ₹18,833 crore (2018) to ₹1.65 trillion (September 2025), and CareEdge Ratings expects healthy growth in advances and deposits ahead, supported by AU SFB’s retail-focused, high-yield portfolio.

Ajmera Realty gained over 4% after the company launched a premium and mid-segment residential project and reported an impressive 81% sell-out within 24 hours, boosting sentiment around the firm’s project execution pace.

Delhivery climbed 4.34%, touching ₹414.05, after unveiling Delhivery International, an Economy Air Parcel service aimed at simplifying and reducing the cost of global exports for SMEs and enterprise customers.

Shares of Swiggy rose over 3% after shareholders approved raising ₹10,000 crore via QIP, strengthening the company’s capital position ahead of expansion.

Tata Motors (TML Commercial Vehicles) continued its upward momentum, gaining 3% to hit a new high of ₹371.20, supported by a strong business outlook post-demerger. The stock climbed as much as 3.4% to ₹399.40 before settling 2% higher.

Sambhv Steel Tubes surged 5.8% after its board approved an expansion plan for manufacturing Stainless Steel Cold Rolled Coils and Pre-Galvanised Coils, boosting investor confidence in its growth roadmap.

PhysicsWallah jumped 5% to ₹145.70, buoyed by strong Q2FY26 results showing a 70% YoY rise in net profit to ₹69.7 crore. The stock, with a market cap of ₹40,793 crore, remains well above its 52-week low.

Kaynes Technology rebounded nearly 7%, snapping a four-day losing streak, after reports that JPMorgan considers it the cheapest stock under coverage based on a 0.7x PEG ratio, despite ongoing concerns around working capital and receivables.

LT Foods declined 7% to ₹365, hitting a six-month low on reports that US President Donald Trump is considering tariffs on rice imports from India, raising concerns over export margins.

Recently listed Fujiyama Power Systems rose 5% to ₹209.45 after posting Q2FY26 results, continuing to attract post-listing accumulation.

Futures & Options
Nifty December 2025 futures closed at 25,958.80, trading at a 119.15-point premium to the Nifty’s cash close of 25,839.65, where the index fell 0.47%. Volatility eased slightly, with India VIX slipping 1.55% to 10.95, indicating steady near-term sentiment despite broader market weakness. The December 2025 F&O contracts are set to expire on 30 December 2025.

Bonds
Indian government bond yields were largely steady on Tuesday after a sharp selloff in recent sessions, triggered by the RBI’s decision to exclude the most liquid 10-year benchmark from this week’s ₹500 billion bond-purchase operation. The benchmark 10-year yield settled at 6.5902%, marginally above Monday’s 6.5697%. The absence of the benchmark paper in the OMO purchase, alongside investor concerns over inflation, potential fiscal pressures from GST reforms, and elevated government borrowing needs, continued to keep upward pressure on yields despite the recent rate cut.

Forex
The rupee closed modestly stronger on Tuesday, supported by exporter-led dollar sales and mild foreign inflows, even as traders remained cautious ahead of this week’s U.S. Federal Reserve policy decision. The rupee ended at 89.8750 per dollar, up 0.2% on the day, after briefly touching 89.8475 earlier in the session. Further appreciation was capped as importers stepped in to hedge at favourable levels, limiting upside momentum, traders said.

Crypto
Crypto markets extended their decline today with sentiment remaining fragile as the Fear & Greed Index slipped another two points to 19, firmly in “extreme fear.” Investors stayed cautious ahead of the US Federal Reserve’s final policy decision of the year, keeping major tokens under pressure. Bitcoin fell 1.61% to about $90,136, briefly losing the $91,000 handle, while Ethereum dipped 0.86% to roughly $3,110.

US Stock Futures
US stock futures were little changed on Tuesday as President Trump approved Nvidia’s request to resume shipments of its flagship H200 AI chips to China, adding a fresh catalyst ahead of the Federal Reserve’s closely watched policy meeting. Futures tied to the Dow Jones Industrial Average, S&P 500, and Nasdaq 100 all hovered near the flatline after Wall Street logged modest losses on Monday.

US Treasury Notes
US Treasury yields moved higher on Tuesday ahead of the Federal Reserve’s policy decision, with the 10-year yield rising toward 4.18–4.20% and the 2-year near 3.60%, as traders grew increasingly concerned about the possibility of a “hawkish cut” despite a widely expected 25 bps rate reduction. Persistently firm inflation and a resilient economy have raised doubts about the Fed’s easing trajectory for 2026, prompting investors to demand a higher term premium and pushing long-dated yields toward multi-month highs.

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