GIFT Nifty signals a strong start

GIFT Nifty:

The Nifty 50 is projected to open higher, following a 91-point jump in the GIFT Nifty February 2025 futures contract.

Institutional Flows:

Foreign portfolio investors (FPIs) sold shares worth Rs 3,449.15 crore, while domestic institutional investors (DIIs) were net buyers to the tune of Rs 2,884.61 crore in the Indian equity market on 21 February 2025, provisional data showed.

According to NSDL data, FPIs have sold shares worth Rs 30588.82 crore (so far) in the secondary market during February 2025. This follows their sale of shares worth Rs 81903.72 crore in January 2024.

Global Markets:

US Dow Jones index futures were up 200 points, with focus now turning to upcoming earnings from artificial intelligence darling Nvidia.

Asian shares displayed mixed performance on Monday, mirroring Wall Street's sharpest decline of the year. US economic data revealed weakening service sector activity and diminished consumer sentiment, fueling concerns about a potential slowdown and its impact on corporate earnings. Additionally, renewed inflation worries and unease stemming from a new bat coronavirus study in China contributed to market volatility. The euro, however, strengthened following Germany's conservative party's victory in national elections.

US indices experienced significant losses Friday, triggered by disappointing service sector PMI and consumer sentiment figures. These data points heightened apprehension about a cooling US economy.

While weaker growth could prompt the Federal Reserve to consider interest rate cuts, it also raises the possibility of a less favorable business climate, potentially affecting corporate profitability. Economic uncertainty was further amplified by the possibility of new 25% tariffs on automobile, pharmaceutical, semiconductor, and lumber imports. The S&P 500 fell 1.7% to 6,013.13, the NASDAQ Composite dropped 2.2% to 19,524.01, and the Dow Jones Industrial Average decreased 1.7% to 43,428.02.

S&P Global's preliminary composite purchasing managers' index for the US declined to 50.4 in February from 52.7 in January, with the services PMI falling to 49.7 from 52.9. The University of Michigan's sentiment index showed US consumer sentiment weakened in February, registering 64.7, down from 71.1.

NVIDIA Corporation shares fell 4.1% on Friday, reflecting growing anticipation and uncertainty ahead of the company's earnings release this week.

Domestic Market:

The domestic equity benchmarks closed lower on Friday, marking the fourth consecutive day of losses. Concerns over potential retaliatory tariffs from the US, coupled with continued selling by FIIs, weighed heavily on investor sentiment. The Federal Reserve's cautious approach to interest rate cuts also contributed to the market's decline. The S&P BSE Sensex, tumbled 424.90 points or 0.56% to 75,311.06. The Nifty 50 index declined 117.25 points or 0.51% to 22,795.90. In the four consecutive trading sessions, the Sensex and Nifty declined by 0.90% and 0.71%, respectively.

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