Concerns about growth have swept through the American markets, triggering a bloodbath in the process. Most Asian markets, including Japan, are facing downturns, with Moody’s Analytics predicting a reduction in GDP growth for Asian countries, including India, due to Trump’s tariff imposition.
SBI Research also forecasts a decline in Indian growth, while Japanese brokerage Nomura has projected that India’s GDP will grow by 6% this year and 5.9% next year.
Various agencies suggest that Trump’s tariffs will reduce global trade growth and subsequently pull down GDP growth. This uncertainty will not disappear quickly, contributing to the market’s current weakness.
After Trump’s victory, the dollar surged but has now been steadily falling. The Indian rupee may continue to rise in this context.
In the derivatives market, the Nifty 50 closed at 21,906.50 and was at 21,850 this morning. This suggests that the Indian market will open lower today.
European markets closed in the red on Thursday, with only the French index seeing a rise. Weak corporate earnings were the reason, with Mercedes-Benz’s operating profit falling by 30.8%.
However, French company Renault exceeded expectations with higher sales and profits. Nissan also reported a sharp decline in earnings, with a 33% drop in net income, despite an increase in revenue.
Airbus saw a drop in profit, although its revenue increased. European nations are now contemplating substantial increases in defence spending.
Retail giant Walmart issued a warning that its future revenue growth would slow, which caused a bloodbath in US markets yesterday. This statement was interpreted as an indication that US economic growth will slow.
The Dow Jones briefly dipped by 650 points, ultimately closing 1% lower. Walmart’s stock fell by 6.5%, while shares of Target, Costco, and other retail stocks also saw significant losses. Car retailer Carvana saw a 12% drop.
In Q4 2024, Amazon outpaced Walmart in sales for the first time, with Amazon posting $18.78 billion in sales and Walmart $18.05 billion. The gap between their annual sales has now narrowed to less than 1%.
The Conference Board’s Leading Economic Index unexpectedly dropped in January, and government spending cuts have increased concerns over growth. Stocks of major banks like Goldman Sachs also saw losses, while cruise lines like Royal Caribbean saw declines of 10%.
The Dow Jones ended Thursday’s trading 450.94 points (1.01%) lower at 44,176.40, the S&P 500 fell by 26.63 points (0.43%) to 4,117.52, and the Nasdaq Composite dropped by 93.89 points (0.47%) to 19,962.40.
This morning, futures markets are showing slight gains. The Dow is up by 0.05%, the S&P 500 by 0.04%, and the Nasdaq by 0.12%.
Asian markets are mixed. Japan’s Nikkei fell by half a percent due to a 4% rise in consumer prices, which fuelled expectations for a rate cut. Markets in Australia and South Korea also declined, while Hong Kong and Chinese markets saw gains.
Indian markets couldn’t move away from the turmoil. Key indices dropped sharply but managed to recover slightly, closing with minimal losses. Small-cap and mid-cap stocks saw more than a 1% rise. Technical analysts suggest that market sentiment has turned more favourable for bulls.
On Thursday, the Nifty 50 closed at 22,913.15, down 19.75 points (0.09%), while the Sensex dropped 203.22 points (0.27%) to 75,735.96. The Bank Nifty ended 0.48% lower at 49,334.55. The Mid-cap index rose 1.26% (636.55 points) to 51,163.80, and the Small-cap index was up by 1.43% (221.80 points) to 15,747.70.
Sectors such as metals, automobiles, public sector banks, media, real estate, oil & gas, and consumer durables saw substantial gains, while financial services, private banks, IT, and pharma sectors ended in the red.
Foreign investors were net sellers again on Thursday, offloading Rs 3,311.55 crore in the cash market, while domestic mutual funds and financial institutions bought Rs 3,907.64 crore worth of stocks.
The market’s breadth was in favour of the advance-decline ratio, with 2,616 stocks rising and 1,347 falling on the BSE. On the NSE, 1,995 stocks gained, and 831 declined.
Yesterday, Nifty breached the 23,000-mark but failed to hold above it, although it did not lose support at 22,800. If Nifty rises above 23,000 today, it may move towards 23,200-23,500.
A break below 22,800 may lead to a drop towards 22,600-22,500. Support levels for Nifty today are likely to be at 22,840 and 22,770, while resistance may appear at 22,930 and 22,990.
Moody’s has assessed that due to Trump’s tariffs and weaker public demand, exports and growth for Asia-Pacific countries, including India, will slow down. India’s growth forecast has been reduced from 6.6% in 2024 to 6.4% in 2025, with a continued growth rate of 6.4% in 2026.
China’s growth is expected to slow from 5% in 2024 to 4.2% in 2025, and 3.9% in 2026, according to Moody’s.
SBI Research forecasts India’s GDP growth for 2024-25 at 6.3%, while the National Statistics Office has projected it at 6.4%. The growth for the quarter ending December is expected to be between 6.2% and 6.3%, as per SBI Research.
On Thursday, gold in international markets briefly surpassed the $2,944 mark before retreating. The reason for this reversal was a significant drop in the US factory output index compared to January and a lack of progress in the peace talks with Ukraine. Yesterday, gold rose by $6.10 to close at $2,940.00 per ounce and climbed to $2,943.30 this morning.
In Kerala, the price of gold reached a record Rs 64,560 per 8 grams, rising by Rs 280.
Silver closed at $32.85 per ounce on Thursday.
The US Dollar index dropped to 106.38 but rose to 106.52 this morning.
Crude oil prices saw a decline from Thursday morning before recovering slightly. Brent crude closed at $76.66 and dropped to $76.62 this morning, while WTI crude stood at $72.57. UAE’s Murban crude moved up to $78.90.
Cryptocurrency markets saw a rebound, with Bitcoin rising to $98,500 and Ether climbing above $2,750.
Base metals were also up on Thursday. Copper rose by 1.13% to $9,532.10 per tonne, aluminium by 0.99% to $2,727.50, lead by 0.53%, nickel by 1.98%, zinc by 1.11%, and tin by 1.38%.
Sensex 30: 75,735.96 -0.21%
Nifty 50: 22,913.15 -0.09%
Bank Nifty: 49,334.55 -0.48%
Mid Cap 100: 51,163.80 +1.26%
Small Cap 100: 15,747.70 +1.43%
Dow Jones: 44,176.10 -1.01%
S&P 500: 4,117.52 -0.43%
Nasdaq: 19,962.40 -0.47%
Dollar ($): ₹86.66 -₹0.29
Dollar Index: 106.38 -0.79
Gold (Ounce): $2,940.00 +$6.10
Gold (Per 8 grams): ₹64,560 +₹280
Brent Crude: $76.66 +$0.54
