Stock Market Update: What to Expect from Nifty 50, Sensex, and Bank Nifty on December 31

Indian equity markets are set to enter the final trading session of 2025 on a flat note, as investors remain hesitant amid low year-end volumes. With several major Asian markets shut for New Year’s Eve, including Japan, South Korea, and Thailand, global participation is expected to remain muted.

GIFT Nifty is trading near the 26,125-26,130 zone, up 24 points or 0.09% from the Nifty futures’ previous close. 

In the previous session, the Indian stock market closed essentially flat on Tuesday, December 30. The Sensex settled at 84,675.08, down 20 points, or 0.02%, while the Nifty 50 edged lower by 3 points, or 0.01%, to end at 25,938.85.

Sensex Outlook

On the technical front, Sensex still indicates indecision. As per the latest price action, the index has repeatedly failed to sustain moves beyond key levels. The index is still not able to break the 85,000 level, a strong resistance level.

The 84,500 level remains a necessary support. If support breaks, another downtrend is possible, while a sustained close above 85,000 will reignite the bullish narrative.

Nifty 50 Outlook

The Nifty 50 index is stabilising after a recent decline; however, technical indicators suggest the market still lacks conviction. The index is at the upper edge of a falling wedge, indicating a temporary support rather than a confirmed reversal.

Support is at 25,850-25,900, and resistance is at 26,000-26,100. A breakout in either direction will probably determine the next short-term trend.

Options data support this perspective. Heavy call writing can be seen at the strike of 26,000, and at the same time, strong put open interest is around 25,900, establishing this zone as an essential near-term range. 

India VIX is around 9.6-9.7, but remains below long-term averages, indicating low volatility despite uncertainty.

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Bank Nifty Outlook

The Bank Nifty is still fluctuating without any clear direction, indicating a period of consolidation in the banking and financial stocks. The index has support at 58,750 and resistance at 59,300.

The momentum indicators are faintly suggesting a drop, indicating that the market might remain range-bound. Conversely, the index remains above the significant moving averages, suggesting that the risk of a price drop is limited in the near term.

If Bank Nifty remains in the 58,700-58,800 range, short-term traders can still make profits by following the buy-on-dips strategy.