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Markets flat on New Year holiday; Sensex down slightly, Nifty up slightly
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ITC and FMCG stocks plunge on tobacco excise duty hike
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Auto stocks gain on strong December sales data
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Vodafone Idea up on major promoter funding, AGR relief
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Adani Group advances in defence and renewables
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Global trade uncertainty persists with US tariff delays
Indian Markets Close Flat in 2026's First Session Amid ITC Sell-Off
The BSE Sensex settled marginally lower by 32 points at 85,188.60, while the NSE Nifty edged up 17 points to 26,146.55 in the opening trading session of 2026. Trading volumes remained thin due to the New Year holiday, with global markets largely closed. Gains in IT, auto, and metal stocks cushioned the indices, but a sharp 9.7% drop in ITC shares dragged the FMCG sector down 3.2%. The government announced an additional excise duty on tobacco products effective February 1, reigniting concerns over volume growth and illicit trade for market leader ITC. Broader markets showed resilience, with midcap and smallcap indices posting modest gains. Analysts noted that the flat close reflects cautious positioning ahead of key data like industrial production and potential FII flows. Domestic institutional investors supported the market, offsetting minor foreign outflows. Sectorally, auto stocks rallied on strong December sales figures, while banking and PSU stocks contributed positively. The rupee held steady against the dollar in limited forex trading. For the Indian economy, this muted start underscores ongoing recovery in consumption-driven sectors like autos. However, higher duties on tobacco could moderate discretionary spending in FMCG. Overall, the session signals stability with selective opportunities in growth sectors. Expectations for 2026 remain positive, driven by anticipated earnings recovery and policy support. Investors are advised to focus on quality large-caps amid valuation normalization. The day's volatility highlights risks from regulatory changes in key consumer segments. Looking ahead, progress on trade deals and monsoon outcomes could drive momentum.
Auto Sector Logs Strong December Sales on Festive Demand and Incentives
Leading Indian automakers reported robust sales growth for December 2025, released on January 1, 2026, signaling continued recovery in consumer demand. Mahindra & Mahindra posted a 23% rise in SUV sales, while Maruti Suzuki and others benefited from festive season tailwinds and tax incentives. Passenger vehicle dispatches surged overall, with two-wheelers and commercial vehicles also showing strong momentum. This performance reflects improving rural and urban spending, supported by favorable monsoons and credit availability. The sector's resilience boosts related industries like manufacturing and ancillaries. For markets, auto stocks gained prominently, contributing to sectoral indices' outperformance. Economically, higher sales indicate GDP uplift through increased production and employment. Analysts expect sustained growth in 2026 amid policy stability. However, rising input costs remain a challenge, prompting selective price hikes. Companies like Hyundai announced increases effective January 1 to offset commodity pressures. The data reinforces optimism for consumption-led recovery. Export-oriented players may face headwinds from global slowdowns. Overall, the strong numbers support positive sentiment for auto and allied sectors. Investors view this as a key theme for portfolio allocation in the new year. Broader implications include potential margin expansion if demand persists. The sector's performance could influence inflation metrics via commodity linkages. Reuters India (based on multiple reports) https://www.reuters.com/world/india/indias-mahindra-mahindra-posts-23-rise-december-suv-sales-2026-01-01/
Vodafone Idea Secures ₹5,836 Crore Promoter Funding and AGR Relief
Vodafone Idea announced receipt of ₹5,836 crore from promoter Vodafone Group under a revised contingent liability agreement on January 1, 2026. This infusion aims to address liquidity concerns and support network expansion in a competitive telecom landscape. Additionally, the Cabinet approved freezing AGR dues at ₹87,695 crore with deferred payment options. The relief package provides breathing room for capex and debt management. Shares reacted positively despite ongoing challenges. For the sector, this stabilizes the third player, fostering healthier competition. Economically, improved telecom infrastructure aids digital economy growth. However, high debt levels persist as a risk. Analysts see potential for market share gains with 5G rollout. The funding eases immediate pressures but long-term viability depends on tariff hikes. Regulatory scrutiny continues on dues and penalties. Implications include boosted investor confidence in telecom stocks. Broader market impact limited but positive for viability concerns. The development aligns with government efforts for sector consolidation. Future ARPU growth critical for sustainability. Overall, it marks a pivotal step toward financial stabilization. Business Standard https://www.business-standard.com/markets/news/stocks-to-watch-today-january-1-2026-jindal-poly-rbl-bank-vodafone-adani-enterprises-126010100064_1.html
Adani Enterprises Acquires Stake in Defence Simulation Firm
Adani Enterprises completed acquisition of 39% stake in Flight Simulation Technique Centre via subsidiaries on January 1, 2026, valued at ₹820 crore enterprise value. This expands the group's footprint in defence and aviation training sectors. The move aligns with India's self-reliance push in strategic areas. It diversifies revenue streams beyond core infrastructure. For markets, Adani stocks saw gains amid positive sentiment. Economically, it strengthens domestic defence capabilities and job creation. Synergies with existing aerospace ventures expected. Analysts view it as strategic for long-term growth. Regulatory approvals underscore policy support for private participation. Implications include enhanced valuations for defence-themed conglomerates. Broader sector boost for technology and simulation industries. The acquisition positions Adani in high-margin niche. Future contracts from government likely. Overall, it reinforces conglomerate's expansion trajectory. Livemint https://www.livemint.com/market/stock-market-news/stocks-to-watch-vodafone-idea-hyundai-india-nbcc-among-10-shares-in-focus-on-new-year-2026-full-list-inside-11767230613167.html
Hyundai Motor India Implements Price Hikes from January 1
Hyundai Motor India announced price increases across models effective January 1, 2026, to counter rising input costs and commodity pressures. The hike averages 0.6%, following similar moves by peers. Leadership transition saw Tarun Garg appointed MD & CEO. This supports margin protection in competitive market. Consumer demand may face short-term impact. For auto sector, it reflects industry-wide cost challenges. Economically, contributes to inflationary trends in transportation. Shares in focus amid sales data releases. Analysts expect volume resilience in premium segments. Broader implications for related manufacturing output. The change aims at sustainable profitability. Overall, sectoral dynamics favor established players. Livemint https://www.livemint.com/market/stock-market-news/stocks-to-watch-vodafone-idea-hyundai-india-nbcc-among-10-shares-in-focus-on-new-year-2026-full-list-inside-11767230613167.html
NBCC Bags ₹220 Crore Infrastructure Contracts
NBCC India secured contracts worth ₹220.31 crore, including projects for Canara Bank facilities on January 1, 2026. This bolsters order book in construction and real estate. Enhances revenue visibility amid government infrastructure thrust. Shares likely to react positively. Economically, accelerates urban development and employment. Positive spillover to materials sector. Aligns with fiscal stimulus goals. Analysts see sustained growth potential. Broader market support from capex cycle. The wins underscore execution strength. Future bids competitive but promising. Livemint https://www.livemint.com/market/stock-market-news/stocks-to-watch-vodafone-idea-hyundai-india-nbcc-among-10-shares-in-focus-on-new-year-2026-full-list-inside-11767230613167.html
Trump Delays Higher US Tariffs on Select Goods for One Year
US President Trump delayed planned tariff increases on upholstered furniture and kitchen cabinets for one year from January 1, 2026, maintaining current rates. This provides relief amid ongoing trade negotiations. Reduces immediate cost pressures for importers. For Indian exporters in affected sectors, sustains volumes short-term. Broader US economy stabilizes retail pricing. Influences global trade flows positively. Indian markets view it favorably for export-oriented stocks. Analysts expect moderated volatility. Implications for bilateral deals enhanced. Overall, eases uncertainty impacting EMs. CNBC https://www.cnbc.com/2026/01/01/trump-delays-increased-tariffs-on-upholstered-furniture-kitchen-cabinets-and-vanities-for-a-year.html
US Captures Record Sovereign Investments Amid AI Focus
The US attracted 48% of global state-owned investments in 2025, totaling $132 billion, as reported January 1, 2026. Sovereign funds prioritize AI and digital infrastructure. Emerging markets like India saw declines. Bolsters US tech growth but diverts capital from EMs. For India, limits funding for infrastructure. Highlights risks from policy shifts. Indian equities may face inflow pressures. Analysts note diversification needs. Broader implications for global capital allocation. Overall, underscores US dominance in innovation themes. Reuters https://www.reuters.com/world/americas/us-draws-bulk-state-owned-investment-2025-assets-hit-record-60-trln-2026-01-01/
Wall Street Projects Robust US Growth in 2026 on AI and Stimulus
Wall Street forecasts US GDP growth of 2.1-2.6% in 2026, driven by AI investments, Fed cuts, and fiscal measures. Inflation expected around 2.5-3%. Extends economic expansion despite risks. For India, stronger US demand aids exports and inflows. Benefits IT and pharma sectors. Potential dollar dynamics favorable. Analysts see opportunities in EM leadership. Broader positive spillover to global sentiment. Overall, supports risk assets including Indian markets. Bloomberg https://www.bloomberg.com/graphics/2026-investment-outlooks/