Indian Stocks Extend Losses: Why You Should Accumulate High-Quality Stocks Now

Indian stocks are facing a fourth consecutive session of losses, with the Sensex and Nifty falling due to uncertainty over a potential U.S.-India trade agreement. However, there are signs of support from a rebound in the rupee and renewed foreign investor buying, which could offset the cautious tone in the market.

Market Performance

The S&P BSE Sensex fell over 300 points to trade below 84,300, while the NSE Nifty 50 slipped below 25,750. Losses were led by Sun Pharmaceutical Industries, Tata Motors PV, Mahindra & Mahindra, NTPC, and Bharat Electronics, with shares of these companies down between 0.5% and 2% in early trade.

Broader Market Gauges

Mid-cap and small-cap stocks were largely flat, with some signs of support from foreign institutional investors returning to the buy side. FIIs bought equities worth about Rs 1,172 crore on December 17, while domestic institutional investors were also net buyers, with purchases of roughly Rs 769 crore.

Expert Views

Dr. VK Vijayakumar, Chief Investment Strategist at Geojit Investments, said that the trend of weakening AI trade is gathering pace in the U.S. market and this trend is likely to continue in early 2026, which will favor non-AI markets like India. He also warned that FIIs might resort to a sell-on-rally strategy, which could lead to further selling.

• The Japanese central bank's decision to raise rates could trigger a reversal of the 'yen carry trade', leading to further selling by FIIs.
• Investors should accumulate high-quality, fairly-valued stocks on market weakness.

Global Markets

Asian stocks fell on Thursday, with a renewed selloff in technology shares reviving doubts about the scale and payoff of artificial-intelligence spending. The MSCI's broad Asia-Pacific index excluding Japan dropped 0.5%, while U.S. equity futures edged higher after a sharp tech-led decline on Wall Street.

Commodity Markets

Oil prices extended a rebound from five-year lows after President Donald Trump ordered a 'blockade' of sanctioned oil tankers entering and leaving Venezuela. Precious metals cooled after a strong rally, with spot gold slipping 0.3% to $4,330 an ounce, and silver easing 0.2% to $66.17.

Remember, this is a perspective, not a prediction. It's essential to do your own research and consider your own risk tolerance before making any investment decisions.