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Market Update

• Equity benchmarks witnessed a sharp selloff, with the Nifty plunging over 3% and the Sensex tumbling nearly 2,500 points—marking their steepest single-day decline since the Lok Sabha election results on June 4, 2024.

• Investor sentiment was rattled by concerns over higher-than-expected reciprocal tariffs imposed by the US and retaliatory duties from China on American goods, sparking fears of a deepening trade war that could disrupt global economic growth and supply chains.

• Global markets also took a hit, with Hong Kong’s index sliding 13% and Japan’s falling 8%. European markets sank up to 6% as the threat of an escalating trade conflict weighed heavily on investor confidence. Reflecting the heightened volatility, India VIX surged over 65%—its sharpest intraday spike since August 24, 2015. This was also the second time since the COVID-19 crash in 2020 that Indian markets witnessed a single-day drop of over 5%.

• The Nifty has now corrected 16% from its peak and is just around 1,000 points away from breaching bear market territory at the 21,022 level. On Friday, US markets also reeled under pressure, with the S&P 500 sinking 6% and the Dow Jones shedding over 2,000 points, marking their worst weekly performance since the pandemic-led crash.

• The selloff came after China announced a hefty 34% reciprocal tariff on all US imports, effective April 10. On the domestic front, the Sensex plunged 2,226 points or 3% to settle at 73,137 after hitting an intraday low of 71,425.

• The Nifty ended 742 points lower at 22,161, after touching an intraday low of 21,743. Sector-wise, metal stocks led the decline with the Nifty Metal Index falling 7%, hit by declining metal prices on the LME and concerns over weakening global demand. Realty, auto, oil & gas, pharma, and banking stocks also saw heavy losses, dropping between 3% and 5%.

Technical Outlook:

• Nifty Index opened gap down by almost 1150 points due to global tensions but took a stop near 21750 zones. It tried to recover for most part of the day despite the gap down and weaker sentiments and closed the day near its higher band. It recovered by 500 points from its lows and finally closed with losses of around 740 points.

• It formed a bullish candle on the daily frame but has been making lower highs from the last five sessions. Now till it holds below 22222 zones, weakness could be seen towards 21900 then 21750 zones whereas resistances have shifted lower to 22350 then 22500 zones.

Derivative Outlook:

• Nifty future closed negative with losses of 2.78% at 22320 levels. Positive setup seen in Delhivery, GMR Airports, Godrej Consumer Products, Britannia Industries, HUL, Dmart, Indigo and Nestle while weakness in Trent, Inox Wind, National Aluminum, Tata Steel, Bharat Forge, Hind Copper, JSW Steel, SAIL, VEDL, DLF, Hindalco and JSL.

• On option front, Maximum Call OI is at 23000 then 23500 strike while Maximum Put OI is at 22000 then 21500 strike. Call writing is seen at 22000 then 22500 strike while Put writing is seen at 21800 then 21500 strike. Option data suggests a broader trading range in between 21600 to 22800 zones while an immediate range between 21900 to 22500 levels.

Global Market Update

• European Market – - European stocks tumbled, dropping to the lowest since January 2024 on the back of Donald Trump’s tariff announcements. UK, Germany and France Index slipped 6% each.

• Asian Market - Stocks in Asia slumped, with a key benchmark sliding by the most since the 2008 financial crisis, in a broad and deep selloff on worry over the trade war’s impact on the global economy. Hong Kong’s Hang Seng Index plunged more than 10% while Japan Index decline over 6%

• US Data - Consumer Credit.

• Commodity - Brent crude was trading near the lowest level in four years as it fell 3.6% at $63 after China raised tariffs on American goods, escalating the trade war between the world's two largest economies and reinforcing fears of a recession.

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