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Market Update

* The equity benchmark Sensex fell by 320 points, while Nifty closed below the 23,400 mark after US President Donald Trump imposed tariffs on Canada, Mexico, and China, fueling concerns about a potential trade war. Global markets, including Asia and Europe, dropped between 1-3%, and the US index fell nearly 2%. Trump's decision to impose a 25% tariff on imports from Canada and Mexico, along with a 10% tariff on Chinese goods, raised fears of retaliatory actions. As a result, the US Dollar Index surged by 1%, reaching its highest level in over two years, and the USDINR spiked above the 87 mark.

* Sensex dropped 319 points, or 0.4%, ending at 77,186, while Nifty slipped 121 points, or 0.5%, to close at 23,361. However, both indices partially recovered by more than half a percent from their intra-day lows after the Finance Minister announced a strong FY25 Union Budget.

* One of the most talked-about budget measures was the tax exemption on incomes up to Rs 12 lakh. Stocks in sectors like auto, NBFC, air conditioning, and QSR saw buying interest due to the positive impact of the budget. Pharma stocks gained following Divi’s Lab's strong Q3 results, while the Nifty IT Index rose by 1%, benefiting from the rising USDINR.

* On the flip side, Nifty Metal and Oil & Gas stocks saw a decline of around 2% each, as concerns over the trade war weighed on global demand. The Nifty FMCG Index fell 1.7% amid profit-taking.

Technical Outlook:

* Nifty index opened gap down by around 160 points but gradually shifted its base higher throughout the day. It witnessed overall choppy movement within a range.

* It managed to close above 23333 marks with losses of around 120 points but recouped most of its opening losses. It formed a small bodied candle with longer lower wick and closed at its upper band. Now it has to hold above 23333 zones for an up move towards 23650 then 23800 zones whereas supports are placed at 23200 then 23100 zones.

Derivative Outlook:

* Nifty future closed negative with losses of 0.49% at 23440 levels. Positive setup seen in UPL, Cholamandalam Finance, Bajaj Finance, SRF, M&M, Lodha, TVS Motors, Divis Lab, Bata India, Shree Cement, and Max Healthcare while weakness in Siemens, HUDCO, Samvrdhana Motherson, HAL, NCC, REC, Torrent Power, HPCL, ABB, IRB and CDSL.

* On option front, Maximum Call OI is at 24000 then 23500 strike while Maximum Put OI is at 23300 then 23000 strike. Call writing is seen at 24000 then 23400 strike while Put writing is seen at 23300 then 23250 strike. Option data suggests a broader trading range in between 23000 to 24000 zones while an immediate range between 23200 to 23700 levels.

* Engineers India – Company secured a project management consultancy contract worth Rs1200cr for the development of an academic institute of national importance.

* Manufacturing PMI Expands To A Six-Month - HSBC India Manufacturing Purchasing Managers’ Index at 57.7 vs 58 previous month.

* Tech Mahindra - Zee Business reported that the company got a favorable tax-related ruling from the Telangana High Court.

* Divi’s Lab Q3 Net Profit Rs589cr (up 64.5% YoY), Revenue Rs2319cr (up 25% YoY), Ebitda Rs743cr (up 52% YoY) and Ebitda Margin 32% vs 26.4% YoY.

* KPR Mills Q3 FY25 Net Profit Rs202.3cr (up 8.2% YoY), Revenue Rs1529cr (up 23.2% YoY), Ebitda Rs302cr (up 11.3% YoY) and Ebitda Margin 19.8% vs 22% YoY.

* Kalyani Steel Q3 reported. Revenue down 1.7% (QoQ) at Rs 484 crore, Ebitda down 13.4% (QoQ) at Rs 83 crore, Ebitda margin at 17.2% versus 19.5% (QoQ). Net profit down 17.1% (QoQ) at Rs 55.3 crore.

* Sky Gold Q3 Ebitda and Ebitda margin. Revenue up 116.74% (YoY) at Rs 997.96 crore, Ebitda up 218.3% (YoY) at Rs 57.3 crore, Ebitda margin at 5.7% versus 3.9% (YoY). Net profit at Rs 36.5 crore versus Rs 8.9 crore (YoY).

* Barbeque Nation Hospitality Q3 results. Revenue down 0.6% (YoY) to Rs 328.89 crore, Net Profit up 4% (YoY)to Rs 4.53 crore, Ebitda down 7% (YoY) to Rs 61.52 crore, Ebitda Margin at 18.7% versus 20.0% (YoY).

* Dhanuka Agritech Q3 results - Revenue up 10.4% (YoY) to Rs 445 crore, Ebitda up 6.2% (YoY) to Rs 75.6 crore, Ebitda margin at 17% versus 17.6% (YoY). Net profit up 21.3% (YoY) to Rs 55 crore.

* Tube Investments Q3 FY25 results. Net Profit Rs161cr (up 2.2% YoY), Revenue Rs1910cr (up 0.3% YoY), Ebitda Rs243cr (up 1.3% YoY) and Ebitda Margin 12.7% vs 12.6% YoY

Global Market Update

* European Market - European stocks slumped at the open Monday after US President Donald Trump said he would impose EU tariffs after launching trade wars with Canada, China and Mexico. Germany, France and UK Index declined up to 1.5%.

* Asian Market – Asian equities fell across the board as US President Donald Trump’s tariffs on top trading partners including China fanned fears of a negative spillover into the region. The MSCI Asia Pacific Index fell as much as 2.8%, its biggest drop since Aug. 5. Some markets saw outsized moves following the Lunar New Year holiday, with Taiwan’s Taiex index briefly down more than 4% and Japan Index dropped over 2.5%.

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