• The Indian share market ended flat on Tuesday, with a slight downward trend in sectors like IT, Financial service, and pharma.
• Market experts attribute the flat finish to the performance of metal and power stocks, while FMCG and auto sectors gained.
• The market's future trajectory depends on Q3 results, the Union budget, and factors like a strong dollar and high bond yields.
• The Indian rupee fell to a new low against the US dollar, further impacting the market's performance.

The Indian share market concluded on a flat note on Tuesday, just ahead of the Christmas holiday. The selling was primarily observed in sectors such as IT, Financial service, pharma, PSU Bank, metal, and realty in Nifty. The Sensex settled at 78,472.87, down by 67.30 points or 0.09 per cent, while the Nifty ended at 23,727.65, down by 25.80 points, or 0.11 per cent.

The Nifty Bank concluded at 51,233, down by 84.60 points, or 0.16 per cent. The Nifty Midcap 100 index closed at 57,057.90 after dropping 35 points, or 0.06 per cent. In contrast, the Nifty Smallcap 100 index closed at 18,732.65 after gaining 44.85 points or 0.24 per cent.

Market experts have noted that the domestic market's flat conclusion ahead of the holiday was primarily due to the dragging performance of metal and power stocks, while FMCG and auto sectors gained from recent corrections.

Market Performance and Sectoral Analysis

They further added, The near-term market trajectory hinges on the outcome of Q3 results and the Union budget, but caution prevails due to a strong dollar, high bond yields, and concerns over rate cuts. The INR hitting an all-time low, further evoked the caution.

On the Bombay Stock Exchange (BSE), 1,980 shares ended in green and 2,016 in red, whereas there was no change in 96 shares. On the sectoral front, except Auto, FMCG, Private Bank, Consumption and Healthcare all sectors ended in red.

In the Sensex pack, PowerGrid, SBI, Infosys, Titan, IndusInd Bank, UltraTech Cement, Bajaj Finance, Tata Steel and Maruti were the top losers. Whereas, Tata Motors, ITC, Nestle India, NTPC, TCS, Zomato, Axis Bank, M&M, Kotak Mahindra Bank and Sun Pharma were the top gainers.

Foreign Institutional Investors and Currency Performance

Foreign institutional investors (FIIs) sold equities worth Rs 168.71 crore on December 23, while domestic institutional investors bought equities worth Rs 2,227.68 crore on the same day.

The Indian currency fell 9 paise to a new record low of 85.20 against the US dollar. On Monday, the rupee closed at 85.11 per dollar. The Indian stock market will be closed on Wednesday on the occasion of Christmas and the next trading session will be on Thursday.

The Indian rupee closed at a record closing low of 85.20 per dollar on Tuesday, weakening by 8 paise from its previous close of 85.12. During intraday trade, the currency fell to a new low of 85.21 amid sustained dollar strength and global pressures. The rupee had opened 2 paise stronger at 85.10 against the greenback but quickly gave up gains as the session progressed. The initial uptick was supported by thin trading volumes ahead of the Christmas holiday season.

The dollar index remained elevated at 108.14, buoyed by US economic resilience, rising Treasury yields at 4.58%, and widening interest rate differentials. Brent crude oil inched up to $72.64 per barrel during the day. "Rupee opened flat and made a new low of 85.21 as the dollar index crossed 108 again and US 10-year yields rose. Inflows remain tepid while outflows continue on all fronts," said Anil Kumar Bhansali, Head of Treasury and Executive Director at Finrex Treasury Advisors LLP.