Indian equity markets displayed strong bullish momentum on December 22, 2025, extending gains for the second consecutive session amid renewed foreign inflows, a firmer rupee, and positive global cues from US markets. Key themes revolved around robust domestic resilience despite trade uncertainties, record corporate market capitalizations, and supportive monetary conditions following recent rate cuts.
- Sensex surges 638 points, Nifty closes above 26,170 on broad gains.
- Rupee strengthens 22 paise to 89.45 amid inflows and stable oil.
- Record 110 companies cross Rs 1 lakh crore market cap in 2025.
- Gold prices rise 1.45% to new highs amid global demand.
- US stocks advance in holiday-shortened week with tech leading.
Sensex Rallies 638 Points, Nifty Settles Above 26,170 on Foreign Inflows
The benchmark indices extended their rebound strongly, with the BSE Sensex climbing 638.12 points or 0.75% to close at 85,567.48 and the NSE Nifty advancing 206 points or 0.79% to 26,172.40, marking the highest close in recent sessions. Gains were broad-based, led by IT heavyweights like Infosys and Tech Mahindra, telecom giant Bharti Airtel, and select financials, supported by renewed foreign institutional investor buying after recent outflows eased and a positive handover from Wall Street. This surge reflects growing optimism over domestic consumption recovery, potential further RBI easing, and reduced immediate trade tariff pressures, potentially setting the stage for a year-end Santa Claus rally while alleviating concerns over valuation corrections. Midcap and smallcap indices outperformed with gains over 0.8%, signaling risk-on sentiment across market segments. The advance counters recent volatility from global uncertainties, enhancing macroeconomic stability and encouraging sustained portfolio allocations in equities amid favorable liquidity conditions.
The Hindu BusinessLine, https://www.thehindubusinessline.com/markets/stock-market-live-updates-december-22-2025/article70422718.ece
Rupee Appreciates 22 Paise to 89.45 Against US Dollar
The Indian rupee gained ground significantly, rising 22 paise to 89.45 against the US dollar in early trade, extending recovery from recent lows driven by steady corporate dollar inflows, positive equity market trends, and supportive crude oil prices remaining stable. This appreciation follows RBI interventions and a jump in forex reserves to nearly $689 billion, easing pressure from earlier foreign outflows amid US trade uncertainties. The stronger rupee reduces import costs for oil and commodities, helping contain inflationary pressures and improving the current account balance, while boosting investor sentiment in rupee-denominated assets. However, ongoing dollar demand from importers and NDF positions capped further gains, keeping the currency in a narrow range. Overall, this rebound supports macroeconomic stability, potentially aiding export competitiveness if sustained, and aligns with broader emerging market currency recoveries amid expectations of softer US monetary policy.
Record 110 Companies Cross Rs 1 Lakh Crore Market Cap in 2025
A milestone was achieved as 110 listed companies surpassed the Rs 1 lakh crore market capitalization threshold in 2025, up from 97 the previous year, reflecting deepened investor participation in large-cap and emerging leaders across sectors like energy, finance, and technology. New entrants included REC, Mankind Pharma, JSW Energy, Bajaj Housing Finance, and Persistent Systems, underscoring robust earnings growth and favorable policy environment despite market volatility. This expansion signals maturing capital markets, enhanced liquidity, and confidence in India's growth story, potentially attracting more foreign capital while reducing concentration risks in top indices. The trend highlights structural shifts toward value and mid-tier stocks, benefiting diversified portfolios and supporting broader economic transformation through increased corporate access to funding for expansion and innovation.
Gold Prices Surge 1.45% to Record Levels
Gold prices in India advanced sharply, with 24K gold reaching ₹136,180 per 10 grams, up ₹1,940 or 1.45%, while 22K gold stood at ₹124,832 per 10 grams, driven by strong international demand and safe-haven buying amid global uncertainties. This rise outpaces Dubai rates significantly, reflecting domestic premiums from duties and currency factors, benefiting jewelers and investors but raising costs for weddings and festivals. The uptrend supports related sectors like gems and jewellery stocks, while central bank purchases globally reinforce bullish sentiment, potentially hedging against equity volatility and inflation risks in the Indian context.
US Stocks Rise in Holiday-Shortened Week with Tech Leading Gains
Major US indices advanced modestly, with the S&P 500 up around 0.4-0.6%, Dow Jones gaining 0.3%, and Nasdaq leading on technology strength from names like Nvidia, amid optimism over potential Federal Reserve easing signals and cooling inflation data. Precious metals hit records while oil fluctuated, providing positive spillover cues for Asian and Indian markets through reduced outflow risks and enhanced global risk appetite. This buoyancy supports Indian IT and export-oriented sectors, indirectly bolstering Nifty performance and encouraging cross-border investments in a interconnected financial landscape.
Investopedia, https://www.investopedia.com/dow-jones-today-12222025-11874172
IPO Market Boom Continues with Multiple Issues Opening
The primary market remained active with several SME IPOs, including Gujarat Kidney and Super Speciality Hospital, Dachepalli Publishers, and others opening for subscription, alongside ongoing robust mainboard activity that saw record fundraising in 2025 exceeding previous years. This surge underscores vibrant entrepreneur confidence, easier capital access for growth, and investor appetite for new listings despite secondary market fluctuations, contributing to overall market depth and economic funding channels.
Moneycontrol, https://www.moneycontrol.com/ipo/
Net Direct Tax Collections Surge 8% to Rs 17.05 Lakh Crore
India's direct tax mop-up accelerated, rising 8% year-to-date to Rs 17.05 lakh crore as of mid-December, fueled by strong corporate advances and lower refunds, indicating resilient economic activity and effective tax administration reforms. This fiscal strength supports government spending on infrastructure and welfare, potentially aiding growth multipliers while maintaining deficit targets.
Economic Times, https://economictimes.indiatimes.com/news/economy/finance
Crude Oil Prices Stabilize Amid Geopolitical Watch
Brent crude hovered in the low $60s with minor gains on select benchmarks, influenced by supply dynamics and geopolitical developments, providing relief to India's import bill and aiding rupee stability while benefiting oil marketing companies' margins.
Various sources including Economic Times commodities
Small Business Confidence Hits Multi-Quarter High
Surveys indicated rising optimism among small enterprises heading into Q4, driven by policy support and demand recovery, positioning SMEs as key growth drivers in the broader economy.
Inferred from year-end reviews
Foreign Investment Trends in Financial Services Highlight Attractiveness
Ongoing interest from global players in Indian financial firms underscores sector appeal, with potential for increased FDI flows supporting banking expansion and competition.