Excerpts:
Market View
Q. Let’s start with the markets. Last week was mixed, there was some rally, but overall sentiment remained cautious. What happened?
Kranthi Bathini:
Markets are still in a consolidation phase. Every time the Nifty moves above the 25,000 mark, it struggles to sustain the momentum beyond 25,750–25,800. There’s no strong earnings support or buying interest at those levels. On the downside, 25,000 is acting as a strong support level, both technically and sentimentally. Today, we dipped below it, which typically invites fresh short positions and selling pressure. The lack of earnings triggers, global trade uncertainties, and new EU regulations on Russian oil imports into India have all contributed to the weakness. Also, heavyweight stocks like Reliance Industries are under pressure, it’s corrected nearly 10% from its peak, which is dragging the broader market.
What’s also missing is sectoral leadership rotation. In past rallies, different sectors took turns to lead. That’s not happening now. Fortunately, domestic institutional investors (DIIs) have stood strong, if not for them, markets could’ve dropped further.
Despite the current weakness, history shows that periods of pessimism often offer good accumulation opportunities for long-term investors and delivery-based traders.
India-UK FTA: Sectoral Impacts
Q. PM Modi and UK PM Keir Starmer just signed a landmark India–UK Free Trade Agreement. What are the implications?
Kranthi: It’s a positive step. FTAs open new markets and show India’s maturity to compete globally. Key beneficiaries from this deal are:
- Textiles
- Leather manufacturers
- Gems and jewellery
- Aquaculture and seafood exports
- Pharmaceuticals and chemicals
We saw selective buying in these segments already, aquaculture and textile stocks moved up.
For instance, Wockhardt, which has a UK plant, surged from ₹300 to ₹1,700, a clear example of how companies with UK exposure can gain from this FTA.
Pharma Sector: India–US vs UK
Q. With the US threatening 200% tariffs on Indian pharma products, can the UK be a balancing export partner?
Kranthi: The US remains the largest revenue contributor for Indian pharma, about 70–80% of earnings for many firms come from North America.
Any US tariff hike would significantly impact Indian pharma. However, it’s unlikely that the US will act hastily because these are essential, life-saving drugs, and imposing tariffs could backfire on US healthcare costs.
That said, the UK can’t replace the US in terms of volume and scale, but it could open alternative opportunities, especially for companies with a footprint in the UK or EU.
Global Market Sentiment: High Uncertainty
Q. What’s the global sentiment looking like, given all the trade-related noise?
Kranthi: Right now, uncertainty is rising. While geopolitical tensions have eased slightly, trade worries are intensifying. The US–China trade situation is critical for global markets, it influences global growth and supply chains.
Long-only global funds are cautious and staying sidelined due to the unpredictability around tariffs and trade deals. India can gain some share of global manufacturing, but for now, volatility will continue.
Q1 Earnings: No Big Surprises Yet
Q. What’s your assessment of the current Q1 earnings season?
Kranthi: It’s been muted so far.
- Infosys surprised positively, but TCS disappointed heavily.
- Reliance Industries didn’t live up to expectations due to pressure from refining margins, impacted by EU’s Russia policy.
- Banks have been mixed — Axis Bank disappointed, while ICICI Bank and HDFC Bank delivered solid numbers.
Interestingly, mid- and small-caps are showing pockets of strength. But overall, we need more heavy lifting in earnings to drive market momentum.
Levels to Watch & Outlook for Next Week
Q. What are the key levels to watch this week? And what’s your outlook?
Kranthi: The 25,000 mark on the Nifty is absolutely crucial.
- If Nifty stays above 25,000, we may see a positive breakout toward 25,250.
- If it falls below 24,800, that could trigger fresh shorting and more downside.
So, the expected range for next week is 24,800 to 25,250. If Nifty can hold 25,000, we may see some consolidation or mild upside. Otherwise, selling pressure could persist in the short term.
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