Sensex recovers 1,100+ pts to turn green; Nifty holds 24,550 as India VIX jumps 5%

Markets witnessed a sharp recovery by noon on December 13, rebounding from a significant dip earlier in the session. Sensex rose 29 points to 81,319, while the Nifty slipped marginally by five points to 24,543. Gains in telecom, FMCG, and auto stocks supported the recovery, even as broader market sentiment remained cautious.

Despite this rebound, market breadth was weak, with 1,138 stocks advancing against 2,219 declining. The volatility followed negative cues from Asian markets, as concerns over a stronger dollar, rising U.S. Treasury yields, and a sluggish Chinese economy weighed heavily. Renewed U.S.-China trade tensions, coupled with uncertainty over Donald Trump's potential return, also added to the jitters.

Foreign institutional investors (FIIs) have intensified selling, offloading Rs 4,572 crore worth of Indian equities over two days. Additionally, U.S. Treasury yields have surged to their highest levels this year, dampening hopes for significant Federal Reserve rate cuts in 2025.

On a brighter note, India’s CPI inflation eased to 5.48 per cent in November, down from 6.21 per cent in October, raising expectations of potential monetary policy support. However, inflation remains slightly above the Reserve Bank of India’s five per cent target, leaving the possibility of deeper rate cuts uncertain.

As the day progresses, traders will closely monitor global cues and domestic macroeconomic data to gauge market direction.