Nifty Set to Open Higher on First Trading Day of 2026; Will It Touch a Fresh All-Time High? Auto Stocks in Focus

Indian equity benchmark indices are set to begin the first trading session of 2026 on a positive note. Early indicators suggest a firm start, with GIFT Nifty at 7:34 AM pointing to a gap-up opening of nearly 66 points for the Nifty. Asian markets remained shut due to the New Year holiday, while cues from the US were largely muted after Wall Street ended 2025 with mild losses in the final session of the year.

Back home, market participants will closely track auto sales data, keeping automobile stocks in focus on January 1, 2026. The auto index had gained over 1 per cent in the previous session and emerged as one of the top three performing sectors in 2025, delivering a strong return of 23.45 per cent during the year.

Institutional activity remained mixed on Wednesday, December 31. Foreign Institutional Investors continued their selling streak for the seventh straight session, offloading equities worth Rs 3,597.38 crore. This pushed total FII outflows for December to Rs 34,349.62 crore, the highest monthly selling seen since September 2025. In contrast, Domestic Institutional Investors maintained strong buying momentum, investing Rs 6,759.64 crore in equities and extending their buying run to 48 consecutive sessions. For the full calendar year 2025, FIIs were net sellers in eight months, while DIIs stayed net buyers throughout the year.

In the final trading session of 2025, Indian equity markets ended higher, supported by gains in metal stocks following the government’s decision to impose a three-year import tariff on select steel products. The Nifty and Sensex closed the year with the India VIX around 9.4, marking its lowest year-end reading. The Nifty 50 rose 190.75 points, or 0.74 per cent, to close at 26,129.60, while the Sensex gained 545.52 points, or 0.64 per cent, to settle at 85,220.60, snapping a four-day losing streak. The Bank Nifty also moved in line with the broader market, advancing 0.69 per cent to close above the 59,500 level.

US markets, meanwhile, ended the final session of 2025 on a subdued note, with all three major indices posting modest declines for the fourth straight session. The S&P 500 fell 0.74 per cent, the Nasdaq Composite declined 0.76 per cent, and the Dow Jones Industrial Average dropped 303.77 points, or 0.63 per cent. Despite the weak close, US equities delivered a strong overall performance in 2025, marking a third consecutive year of double-digit gains amid significant volatility. On the economic front, data from the US Labor Department showed that initial jobless claims unexpectedly declined in the week ended December 27, offering some support to the broader macro-outlook.

Disclaimer: The article is for informational purposes only and not investment advice.