Stock Markets Today, February 3, 2025: The impact of Budget 2025, Trump’s tariffs, and weak global markets are likely to influence Indian benchmark indices, Sensex and Nifty, today.
At 6:50 AM, GIFT Nifty futures were trading 173 points lower at 23,382, indicating a potential gap-down start for the markets.
In the previous session, benchmark equity indices closed flat following the presentation of Union Budget 2024-25 by FM Nirmala Sitharaman. The Sensex ended at 77,505.96, up 0.01 per cent. Nifty50 closed 0.11 per cent lower at 23,482.15.
Domestic Cues
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The market's reaction to the Union Budget was largely neutral, with the income tax relief not providing a major market boost. There were some rationalisations in the Customs duty structure, cuts in import duties on key telecom and IT components, and duty reductions on vehicle imports. Other measures related to agriculture, rural development, and renewable energy were viewed positively.
As investors absorb the Budget’s details, attention will shift back to earnings season, coupled with manufcaturing PMI final data for January.
Investors are now looking out for results from companies such as Alembic Pharma, Power Grid, Divi’s, and Gland Pharma, among others. The market will also react to earnings from Anant Raj, Aarti Industries, and Neogen Chemicals among others.
With the Budget aiming to support consumption while maintaining fiscal discipline, attention now turns to the RBI for further action to stimulate economic growth. The six-member monetary policy committee (MPC) is expected to cut the policy repo rate for the first time in almost five years. A Business Standard poll of 10 participants (excluding Yes Bank) predicts a 25-basis-point (bp) rate cut. The RBI’s policy review is set to be announced on February 7.
Apart from that, experts have raised concerns about the potential impact of escalating trade tensions between the US, Canada, Mexico, and China, with warnings that this could lead to an increase in goods dumping into India. New Delhi is monitoring the situation closely as the US President Donald Trump imposes a 25 per cent tariff on imports from Canada and Mexico and a 10 per cent tariff on Chinese imports, set to take effect on Tuesday.
Other market triggers
FII, DII
FIIs sold shares worth Rs 1,327.09 crore on February 1, while DIIs bought shares worth 824.38 crore.
IPO market
Dr. Agarwal's Health Care's IPO (Mainline) and Malpani Pipes And Fittings IPO (SME) will see their allotment today.
Commodity market
Gold prices surged past the $2,800 mark for the first time on Friday, driven by a flight to safety following US President Donald Trump’s tariff threats, which raised concerns about global economic growth and inflation. Spot gold climbed 0.6 per cent to $2,810.55 per ounce, briefly reaching a record high of $2,817.23 earlier in the session. US gold futures remained relatively stable at $2,822.90.
Meanwhile, oil prices eased on Friday and ended the week lower as traders braced for the impact of the upcoming tariffs the US was set to impose on Canada and Mexico starting Saturday. Brent crude futures for March, which expired on Friday, settled lower at $76.76 per barrel. US WTI crude finished 0.3 per cent lower at $72.53.
Global cues
Global markets in the Asia-Pacific region opened lower on Monday following a weekend announcement by US President Donald Trump, who imposed tariffs on Canada, Mexico, and China.
Last checked, ASX 200 was down 0.75 per cent, while Nikkei tanked 2.22 per cent. Kospi fell nearly 2.81 per cent.
Chinese markets remained closed due to the ongoing Lunar New Year holiday.
Later in the day, China’s Caixin/S&P Global services manufacturing activity data is expected to be released, with a PMI estimate of 50.5 according to a Reuters poll.
Over the weekend, Trump signed an order implementing a 25 per cent tariff on imports from Mexico and Canada, and a 10 per cent tariff on Chinese goods, which are set to take effect Tuesday. Energy exports from Canada will face a reduced 10 per cent tariff. The US engages in approximately $1.6 trillion in trade with these three nations annually.
Last Friday, the US stock markets closed lower. The S&P 500 lost 0.50 per cent while the Dow Jones dropped 0.75 per cent. Nasdaq settled 0.28 per cent lower at 19,627.44. Investors now await manufacturing data from countries including US, UK and China, couled with Euro Area inflation rate.
Here's how analysts are assessing today's (February 3) trading session:
Shrikant Chouhan, head of equity research at Kotak Securities
For traders, the 20-day SMA or 23,270/77000 and 23,100/76500 would act as key support zones, while the 50-day SMA or 23,810 /78500 and 23,900/78800 could be the key resistance areas for the bulls.
Rupak De, senior technical analyst at LKP Securities
Nifty has support at 23,280, and as long as it remains above this level, the trend might stay positive. On the higher end, the index could move towards 23,700–24,000 in the short term. However, a fall below 23,280 might trigger panic in the market.
