The Indian stock market opens on Friday, 5 December 2025, with traders staring at one of the most event-heavy sessions of the year. An RBI policy verdict at 10:00 AM, a record-weak rupee, cautious global risk sentiment and a cluster of stock-specific triggers — all of these are lined up before and during trade.
Here’s a comprehensive pre‑open guide to what you need to know before the bell.
1. How markets closed on 4 December: calm before a possible storm
On Thursday, Sensex and Nifty finally broke a four‑day losing streak, but the rebound was modest and far from euphoric:
- Sensex: 85,265.32, up 158 points (+0.19%)
- Nifty 50: 26,033.75, up 48 points (+0.18%) [1]
According to market commentary, IT stocks led the recovery, helped by renewed optimism around US Fed rate cuts and the tailwind of a weaker rupee, which boosts dollar revenues for exporters. At the same time, the broader tone remained cautious:
- Market breadth on the BSE was negative, with more stocks falling than rising. [2]
- Analysts flagged overhead resistance for Nifty in the 26,100–26,150 zone, with immediate support around 25,900–25,950, suggesting limited upside unless a strong catalyst emerges. [3]
Volatility remained subdued, with India VIX near 10.8, indicating complacency even as macro risks build. [4]
Takeaway: The index closed just above 26,000 but still sits in a tight band. Friday’s RBI decision could be the trigger that finally forces a breakout — or a breakdown.
2. GIFT Nifty and technical setup: flat to mildly positive start
Overnight, GIFT Nifty — the offshore proxy for the Nifty 50 — was broadly flat:
- EquityPandit shows GIFT Nifty at ~26,177.5 as of 2:33 AM IST on 5 December 2025. [5]
- 5paisa’s pre‑open wrap pegs GIFT Nifty around 26,190, essentially unchanged relative to Thursday’s close, and calls for a range‑bound or steady opening in the absence of fresh overnight shocks. [6]
That aligns with technical views from ET and others, which suggest:
- Resistance: 26,100–26,150 on Nifty
- Support: 25,900–25,950, with 26,000 as a short‑term line in the sand. [7]
What this implies for the open (9:15 AM IST):
- Base case: A flat to mildly positive open, followed by tight range‑trading until the RBI announcement.
- Event risk: Volatility and sharp index moves are more likely after 10:00 AM, when the policy decision and Governor’s commentary hit the tape.
3. RBI policy decision at 10:00 AM: the main event
The Reserve Bank of India’s Monetary Policy Committee (MPC) concludes its December meeting today (3–5 December). Governor Sanjay Malhotra will announce the decision and address the press at 10:00 AM IST. [8]
What the street expected a week ago…
- A Reuters poll of economists conducted late November found nearly 80% (62 of 80) expected the RBI to cut the repo rate by 25 bps to 5.25% at this meeting, citing ultra‑low inflation and resilient growth. [9]
- A Bloomberg survey also showed a majority expecting a 25 bps cut to 5.25%. [10]
- Several brokerages and economists highlighted that headline CPI has dropped below the RBI’s 2–6% tolerance band for at least two months, with October inflation around 0.25% year‑on‑year, giving theoretical space to ease. [11]
…and what markets are pricing now
The narrative has shifted sharply in the last few sessions because of the rupee’s slide:
- A Reuters piece notes that rupee forwards have spiked, with the 1‑year dollar/rupee forward implied yield jumping to around 2.6%, as traders unwind rate‑cut bets and rush to hedge after the currency broke multiple psychological levels. [12]
- The overnight swap market now prices almost no chance of a rate cut, a big turnaround from earlier expectations. [13]
- A recent Moneycontrol interview with Kotak Mahindra AMC pegs the probability of a 25 bps cut at roughly 50%, calling the setup “mixed” — low inflation argues for easing, but the rupee and external risks argue for caution. [14]
- A separate report, quoting Bank of Baroda economists, says they now expect the RBI to hold the repo rate at 5.50% and retain a neutral stance, given strong growth and currency pressures. [15]
Key scenarios traders are gaming for 5 December
- Base case #1 – 25 bps cut to 5.25% with cautious guidance
- Equities: Rate‑sensitive sectors (banks, NBFCs, autos, realty, consumer durables) could see a short‑term pop.
- Rupee/Bonds: Rupee could remain under pressure; bond yields likely to fall initially.
- Risk: If RBI sounds too dovish while the rupee is fragile, markets might worry about imported inflation later.
- Base case #2 – Status quo at 5.50% with dovish tone
- Equities: Relief rally in the rupee; banks and PSU lenders may pause but not collapse.
- Narrative: “Wait and watch” — RBI acknowledges low inflation but prioritises currency stability.
- Market reaction: Knee‑jerk volatility, followed by rotation into quality banks and exporters.
- Surprise hawkish tilt (no cut and tougher language on FX or liquidity)
- Would likely hit rate‑sensitive stocks in the short term, but could support the rupee and reduce imported inflation fears.
For traders: Expect sharp moves between 10:00–11:00 AM, especially in Bank Nifty, NBFCs, autos, and realty. Position sizing and stop‑loss discipline matter more than directional bravado around the announcement.
4. Rupee at record lows, FPI outflows and what they mean for stocks
The Indian rupee is the other big story driving market sentiment into today’s open.
Record-low rupee
- The rupee has breached the 90-per-dollar mark, hitting around 90.41–90.43 on Thursday, making fresh all‑time lows for the second straight day. [16]
- It has depreciated nearly 5% year‑to‑date, making it the worst‑performing major emerging‑market currencythis year, even as the US Dollar Index itself is down close to 9% against a basket of peers. [17]
- Analysts quoted by ET now see the rupee trading in a 90.5–91.5 range in the medium term, with 90 acting as a resistance rather than support — a structural shift toward a weaker currency regime. [18]
A separate Reuters report flags that HDFC Bank’s treasury desk sees a risk of the rupee sliding all the way to 92 per dollar if a US–India trade deal does not materialise quickly and foreign inflows remain weak. [19]
FPI flows and bond market signals
- ET’s live market blog notes that Foreign Portfolio Investors (FPIs) sold about $933 million worth of Indian equities in just the first three trading days of December, more than twice their total net selling for the whole of November. [20]
- Heavy FPI outflows and the weaker rupee have pushed government bond yields up, with the benchmark 10‑year yield hovering around 6.5% as traders temper their rate‑cut expectations. [21]
RBI’s dilemma
As an ET forex column points out, the RBI now faces a classic trade‑off:
- Cut rates to support growth and credit, risking further pressure on the rupee and imported inflation, or
- Hold rates to stabilise the currency, potentially delaying the transmission of earlier easing to borrowers. [22]
Sector impact pre‑open
- Autos & realty: Have already seen selling on rupee fears but stand to benefit the most if a cut is delivered. [23]
- FMCG and consumer durables: Hit by higher input‑cost risks and weaker discretionary demand if inflation expectations rise again. [24]
- Exporters (IT, pharma, specialty chemicals): Beneficiaries of a weaker rupee, a key reason IT has outperformed over the last couple of sessions. [25]
5. Global cues: US jobs data, Fed hopes, Asia mixed, oil steady
US markets: near record highs, but yields creep up
Overnight, Wall Street’s main indices were little changed to modestly higher:
- The S&P 500 hovered near its all‑time high, while the Russell 2000 small‑cap index outperformed, extending a strong two‑week run. [26]
- US weekly jobless claims dropped to around 191,000, the lowest since September 2022, suggesting the labour market remains tight even as other indicators show cooling. [27]
- That pushed the 10‑year US Treasury yield up to roughly 4.10%, from about 4.06%, a small move but one that keeps the spotlight on global bond markets. [28]
Despite firmer yields, Fed fund futures still price in a very high probability of a 25 bps cut at the Fed’s December 10 meeting, which supports risk assets globally. [29]
Europe and Asia
- The STOXX Europe 600 closed around 0.45% higher, powered by industrials and banks, in its third straight session of gains. [30]
- In Asia, early trade on Thursday/Friday was mixed: some markets like Hong Kong’s Hang Seng clawed back intraday losses to end higher, while others traded cautiously on stretched tech valuations and macro uncertainty. [31]
Oil prices: no big shock for India… yet
Oil remains a wild card but not an acute pain point today:
- WTI crude is trading near $59–59.5 per barrel, while Brent hovers close to $63, roughly flat to slightly higher over the past week. [32]
Steady oil prices are a relief for India’s import bill and inflation outlook, especially as the rupee weakens. However, any renewed spike in crude — for example due to geopolitics — would quickly re‑ignite concerns.
Net global cue for Dalal Street:
Supportive but not overwhelmingly bullish. Global equities are near highs, rates are drifting higher, and markets are laser‑focused on upcoming Fed and RBI decisions.
6. Big domestic headlines beyond the RBI: IPOs, demergers and geopolitics
6.1 IPOs in the spotlight: Meesho, Aequs and a busy primary market
The primary market remains hot, and several deals intersect with today’s trade:
- Meesho IPO:
- The issue, which opened on 3 December and closes today (5 December), has already been over 3 times subscribed as of Day 2, with a strong grey‑market premium hinting at a possible ~45% listing pop, according to ET’s GMP tracker. [33]
- High retail and QIB interest means sentiment in new‑age tech and consumer internet stocks will be closely watched.
- Aequs IPO:
- Aequs’ ₹921‑crore IPO is also on investors’ radar, with strong subscription data and closing date on 5 December, ahead of a planned listing on 10 December. [34]
Heavy interest in these issues signals that risk appetite in pockets of the market is still healthy, despite macro jitters.
6.2 HUL’s ice‑cream demerger and special pre-open session
Hindustan Unilever (HUL) is a key stock to track in Friday’s trade:
- HUL has set 5 December 2025 as the record date for the demerger of its ice‑cream business into Kwality Wall’s (India) Ltd (KWIL). [35]
- A special pre-open session will be held for HUL on 5 December to adjust for the demerger, and shareholders on record are eligible to receive free shares of the demerged ice‑cream unit. [36]
That makes HUL and related FMCG names high‑volatility candidates at the open, independent of the RBI outcome.
6.3 CEAT, Canara Bank, Vedanta and other stock‑specific triggers
A cluster of corporate developments will drive stock‑specific trades:
- CEAT: The tyre maker’s Finance and Banking Committee meets today (5 December) to consider issuing non‑convertible debentures (NCDs) via private placement. [37]
- Canara Bank: Has already raised ₹3,500 crore via Basel III‑compliant Additional Tier‑I bonds at a 7.55% coupon, highlighting continuing demand for high‑yielding financial paper. [38]
- Vedanta: Under scrutiny after a short‑seller note suggested planned fundraising via ESL Steel may ultimately be used at the parent level (Vedanta Resources) for debt repayments. [39]
- Maruti Suzuki: In focus after unveiling its first EV SUV (e‑Vitara), expanding its electric portfolio. [40]
Moneycontrol’s “stocks to watch” list for 5 December also flags names such as Kirloskar Ferrous, Semaec, Greenlam Industries, RailTel and Brookfield India REIT, driven by project wins, fund‑raises and corporate actions. [41]
6.4 OYO’s pre‑IPO moves
A LinkedIn analysis notes that OYO is gearing up for its long‑awaited IPO with a bonus issue:
- Bonus ratio: 1 share for every 19 held
- Record date: 5 December 2025 [42]
While OYO is not yet listed, this development feeds into the broader “new‑age, turnaround IPO” narrative that investors are tracking.
6.5 Putin’s India visit: defence, energy and diplomacy
Russian President Vladimir Putin is in India for a two‑day state visit and the India–Russia Annual Summit, with trade, defence and energy cooperation high on the agenda. [43]
Market watchers highlight:
- Defence stocks such as HAL, Bharat Dynamics and Bharat Electronics (BEL) as key beneficiaries if new deals or co‑production announcements materialise. [44]
- Potential implications for energy security, fertiliser and commodities trade, which could subtly shape medium‑term sentiment in related PSU and infra names.
While most of the summit outcomes will play out beyond today, headlines could inject intraday swings in defence and PSU baskets.
7. Business sentiment and macro undercurrents
Beyond the day‑to‑day noise, there are some important macro undercurrents that frame how investors might react to today’s events:
- A Dun & Bradstreet India survey shows both its Financial Confidence Index and Investment Confidence Index falling sharply in Q4, with investment confidence down 8% quarter‑on‑quarter, the steepest drop in eight quarters. Firms expect tighter liquidity, higher borrowing costs and softer margins, especially in construction, real estate and trade. [45]
- At the same time, GDP growth remains robust, with recent estimates pointing to 7–7.5% growth for the latest quarter, reinforcing the idea that India is a “high‑growth but cautious” story right now. [46]
This combination — strong headline growth but moderating confidence and a stressed currency — is exactly what makes today’s RBI communication so sensitive for markets.
8. How traders and investors might approach 5 December 2025
Without giving personalised advice, here are some broad frameworks traders and active investors are using into today’s open:
8.1 Expect two distinct phases in the session
- Pre‑RBI (9:15–10:00 AM)
- Likely narrow range in Nifty and Sensex, with stock‑specific moves driven by IPO buzz, HUL demerger and overnight news.
- GIFT Nifty suggests no strong directional bias at the open.
- Post‑RBI (10:00 AM onwards)
- Sudden moves in Bank Nifty, PSU banks, NBFCs, autos, realty.
- Elevated risk of whipsaws in the first 15–30 minutes after the announcement as algos and fast money react.
8.2 Sectors likely to stay in focus
- Banks & NBFCs: Most sensitive to rate and liquidity guidance.
- Autos & realty: Direct EMIs and affordability play; they gain the most from cuts but suffer if the RBI stays hawkish to defend the rupee. [47]
- IT & exporters: Beneficiaries of a weaker rupee; may remain relative outperformers if currency volatility persists. [48]
- Defence & PSU complex: In play on the back of Putin’s visit and possible strategic announcements. [49]
- FMCG & consumer: Watch HUL for demerger-related volatility; broader pack sensitive to inflation and currency commentary. [50]
8.3 Risk‑management basics for an event day
- Position sizing: Many intraday traders cut leverage ahead of 10:00 AM, preferring to scale up only once the first reaction settles.
- Use of options: Some participants hedge directional futures or cash positions with Nifty/Bank Nifty options, or even run event‑driven straddles/strangles (with clear risk limits).
- Stop‑loss discipline: Wide, sudden moves are more common around central‑bank days; predefined exits help avoid emotional decisions.
9. Bottom line before the bell
Going into the 5 December 2025 open, the Indian stock market is balancing:
- Supportive global backdrop (equities near highs, Fed cut hopes intact),
- A record‑weak rupee and heavy FPI outflows,
- A knife‑edge RBI decision where expectations have shifted from “cut is certain” to “anything is possible”, and
- A busy slate of stock‑specific and geopolitical triggers, from HUL’s demerger to Meesho’s IPO and Putin’s summit.
For traders, today is less about calling the exact direction and more about respecting event risk and managing exposure around 10:00 AM.
For longer‑term investors, the bigger story remains intact: India is still a high‑growth market, but the short‑term path for equities depends on how skillfully the RBI navigates the tension between growth, inflation and currency stability.
Disclaimer: This article is for informational and educational purposes only and does not constitute investment, tax or legal advice. Markets are risky; please consult a qualified adviser before making investment decisions.
References
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