Whalesbook
Global Markets Set the Tone
Asian markets presented a mixed picture on February 5, 2025. Japan's Nikkei 225 managed a marginal gain, with the broader Topix also trading in positive territory. However, sentiment soured elsewhere, as South Korea's Kospi plunged 1.31% and Australia's S&P/ASX 200 edged down 0.18%. This followed a mixed performance on Wall Street the previous day. The Dow Jones Industrial Average closed higher, but the S&P 500 shed 0.51% and the Nasdaq Composite tumbled 1.51%, weighed down by a significant sell-off in technology stocks.
Tech ADRs Signal IT Sector Headwinds
The weakness in U.S. technology counters immediately cast a shadow over Indian IT heavyweights. American Depository Receipts (ADRs) for Infosys and Wipro faced substantial selling pressure, falling up to 5.5% and to $2.53 respectively. This decline suggests potential headwinds for Indian information technology stocks as the domestic market opens.
Commodity and Currency Markets
Crude oil prices continued their downward trend, with U.S. West Texas Intermediate (WTI) futures down about 1.10% at around $64.42 per barrel, and Brent crude off by 1.08% near $68.71 per barrel. Gold futures for April 2026 delivery traded at ₹1,59,300 per 10 grams on the MCX, while international prices hovered around $4,953 per ounce. The U.S. Dollar Index saw a slight uptick, trading 0.01% higher at 97.65, while the Indian rupee had appreciated to 90.42 against the dollar on February 4.
Foreign Investment and Sector Performance
Provisional data for February 4 indicated continued buying interest from domestic institutions. Domestic Institutional Investors (DIIs) were more aggressive, buying ₹249.54 crore in equities, while Foreign Institutional Investors (FIIs) made modest net purchases of ₹29.79 crore. In the previous trading session, select consumer-facing and industrial sectors posted gains, led by Electronics (+4%) and E-commerce (+3.6%). Yash Birla Group stocks surged 6% in group-wise performance.
Budget and Trade Deal Impact
The market's direction will also be shaped by ongoing sentiment surrounding the India-U.S. trade deal and the lingering reactions to recent Union Budget announcements. These factors, combined with currency and commodity price movements, will dictate intraday trading.