After a 10-day losing streak, Nifty has experienced its longest decline in recent times, marking a 16% correction from its September highs. This is now the 6th largest drop since the 2008-09 financial crisis and the second-largest since the Covid-led market crash in 2020. Here are the top 5 reasons why this decline could be nearing its end: 

1) Entering a Crucial Support Zone

Nifty has now entered a critical support range, as defined by the 100-week Moving Average Envelope (+/-3%). Historically, this range has acted as a strong support level, containing market downturns except in extreme cases like the Covid crash. This suggests that the index may be approaching a durable bottom.

2) RSI Signals an Oversold Market

The 14-week Relative Strength Index (RSI) has dropped into the oversold ‘bull market’ zone (33-40). According to historical data, 87% of past corrections that reached this RSI level resulted in a market trough followed by a recovery.

3) Market Breadth at Extreme Lows

Breadth indicators for the NSE500 index have hit extreme lows, with only:

• 7.6% of stocks trading above their 50-day moving average,
• 6.2% above their 100-day moving average, and
• 10.1% above their 200-day moving average.

These levels are similar to those seen during the Covid crash. Historically, such extreme readings in market breadth have often preceded market bottoms.

4) Historical Trends Support a Rebound

Patterns from past market cycles indicate that odd-numbered years and years following U.S. presidential elections have typically seen strong market performance. The Nifty has risen in 75% and 83% of such cases, respectively, delivering median returns of 17.1% and 21%.

5) Valuations Indicate Possible Opportunities

Valuations across various sectors have now dropped below their 1-year and 5-year averages. 

Conclusion

While market movements remain uncertain, key technical and historical indicators suggest that Nifty could be approaching a stabilisation phase. However, investors should remain cautious and consider multiple factors before making any financial decisions.

Disclaimer: This blog has been written exclusively for educational purposes. The securities mentioned are only examples and not recommendations. This does not constitute a personal recommendation/investment advice. It does not aim to influence any individual or entity to make investment decisions. Recipients should conduct their own research and assessments to form an independent opinion about investment decisions. 

Investments in the securities market are subject to market risks, read all the related documents carefully before investing.

The escalating trade war under US President Donald Trump has introduced a wave of economic uncertainty across global markets. However, a recent report suggests that this turmoil may open doors for India by improving its market access in the US. With the US imposing steep tariffs on agricultural imports, India, which is currently negotiating a trade agreement with the US, could use this scenario to its advantage.

US Tariff Increases and Global Retaliation

Trump has confirmed a 25% tariff on imports from Canada and Mexico while doubling tariffs on Chinese goods to 20%. These measures have triggered retaliatory actions. According to the report, Canada has responded with duties of up to 25% on $127.7 billion worth of US goods, while China has introduced additional tariffs on American agricultural products, including chicken, wheat, corn, cotton, soybeans, pork, and dairy.

Impact on Indian Exports

Despite concerns over global supply chain disruptions, the report suggests that the US tariff hikes are unlikely to have a severe impact on India’s agricultural exports. As per the report, India exports coffee, tea, and other beverages worth approximately $390 million annually to the US. Additionally, shrimp and fish exports from India to the US amount to around $2 billion. While a blanket 100% tariff on all US agricultural imports would be a challenge, the report indicates that the current tariff scenario does not pose a significant threat to India’s export volumes.

India’s Potential Market Advantage

With India and the US actively negotiating a trade deal, there exists a possibility for India to secure better market access. The report highlights that if competing exporters, such as China, face high tariffs while Indian exports receive favourable concessions under a free trade agreement, India could gain a competitive edge in the American market. This would provide Indian exporters with a stronger foothold, especially in agricultural and seafood exports.

Long-Term Uncertainty and Risks

While the short-term outlook appears promising for India, the report cautions that the long-term consequences of the trade war remain unpredictable. Disruptions in global supply chains and retaliatory tariff measures from affected nations could introduce unforeseen challenges. Additionally, the report warns that President Trump’s aggressive tariff policies are unlikely to ease, despite the short-term economic costs. His address to the joint houses of Congress on Wednesday is expected to present these tariffs as beneficial to the US economy in the long run.

Conclusion

The US tariff war is reshaping international trade relationships, and India finds itself in a position where it could turn challenges into opportunities. While the report acknowledges risks associated with supply chain disruptions, it also emphasises the possibility of India securing stronger market access in the US through ongoing trade negotiations. However, the evolving nature of global trade policies means that India must navigate this shifting landscape with caution.

Disclaimer: This blog has been written exclusively for educational purposes. The securities mentioned are only examples and not recommendations. This does not constitute a personal recommendation/investment advice. It does not aim to influence any individual or entity to make investment decisions. Recipients should conduct their own research and assessments to form an independent opinion about investment decisions. 

Investments in the securities market are subject to market risks, read all the related documents carefully before investing.

A recent report indicates that the Income Tax Department will reportedly gain extended authority to examine individuals’ digital footprints, including emails, social media accounts, bank transactions, and online investments. If there are suspicions of tax evasion, undeclared assets, or concealed financial records, tax officials may be able to investigate digital accounts as part of their scrutiny process.

This potential change aligns with the evolving financial landscape and aims to combat financial fraud, undisclosed wealth, and tax evasion. The proposed amendments will bring tax investigations in line with the digital age, enabling authorities to use modern tools to track and verify financial activities.

When Can Tax Officials Access Your Digital Information?

Currently, under Section 132 of the Income Tax Act, 1961, tax authorities have the power to conduct searches and seizures if they possess credible information that an individual is concealing income or assets to evade taxes. Traditionally, this allowed officials to physically inspect premises, break open safes, and seize documents if necessary.

However, from April 1, 2026, this right is expected to extend into the digital realm. Authorities may be empowered to access computers, cloud storage, and online financial accounts if they suspect the concealment of taxable income or assets. This shift signifies a move towards digital forensics in tax investigations.

How Could This Impact Taxpayers?

With the expansion of digital transactions, tax investigations are also evolving to keep pace with financial digitisation. If an individual is suspected of underreporting income or holding undisclosed assets, tax officials may have the ability to investigate:

• Emails and social media accounts for potential evidence of financial dealings
• Bank transactions and investment platforms to trace unreported income
• Online trading accounts to check for undisclosed stock market activity

While the primary objective is to curb tax evasion, concerns about privacy and data security may arise. It remains to be seen how these new measures will be implemented and whether they will strike a balance between enforcing tax laws and protecting personal data.

Key Takeaway

As financial regulations tighten, individuals and businesses must ensure compliance with tax laws. Keeping accurate financial records, filing timely tax returns, and fully disclosing income and investments remain essential. Those with significant assets or complex financial structures may find it beneficial to seek expert tax advice to avoid potential scrutiny under the revised law.

Disclaimer: This blog has been written exclusively for educational purposes. The securities mentioned are only examples and not recommendations. This does not constitute a personal recommendation/investment advice. It does not aim to influence any individual or entity to make investment decisions. Recipients should conduct their own research and assessments to form an independent opinion about investment decisions. 

Investments in the securities market are subject to market risks, read all the related documents carefully before investing.

China has announced an economic growth target of approximately 5% for 2025, a figure consistent with its objectives over the past two years. However, meeting this goal may prove more challenging due to increasing global uncertainties, particularly higher tariffs imposed by the United States.

The target, revealed during the opening session of China’s annual legislative meeting, signals the government’s commitment to stabilising growth amid ongoing economic pressures. The inclusion of the term “around” in the target allows for flexibility should actual growth figures fall slightly short of the stated goal.

Challenges Posed by Global and Domestic Economic Factors

While China remains committed to economic expansion, external and internal challenges persist. The government’s official report highlighted concerns over an increasingly complex international landscape affecting trade, science, and technology.

Domestically, the report acknowledged that China’s economic recovery remains fragile. Weak demand, sluggish consumer spending, and subdued investment activity continue to pose risks to sustained growth. The International Monetary Fund (IMF) has projected China’s GDP growth at 4.6% for 2025, slightly below the government’s target and lower than the 5% recorded in 2024.

Focus on Boosting Domestic Demand

A key highlight of this year’s economic strategy is an enhanced focus on domestic demand. The government’s report outlined plans to position internal consumption as the primary driver of economic growth. This marks a strategic shift, aligning with the ruling Communist Party’s December meetings, which underscored the need to bolster household spending and domestic economic activities.

President Xi Jinping’s administration is expected to introduce more robust stimulus measures to support economic momentum. While the details of these measures remain undisclosed, economists suggest that increased public spending and targeted financial incentives could be part of the strategy to revive consumer demand.

Increase in Defence Budget Amidst Economic Priorities

In addition to economic policy, China’s draft budget revealed a 7.2% increase in defence spending for 2025, bringing the total military expenditure to 1.78 trillion yuan (approximately $245 billion). This solidifies China’s position as the world’s second-largest defence spender after the United States.

While this budget allocation reflects strategic priorities, it also raises questions about balancing economic stimulus with increased military spending, particularly in the face of constrained fiscal resources.

Conclusion

China’s decision to maintain a GDP growth target of approximately 5% in 2025 underscores its ambition to navigate economic headwinds while ensuring stability. The government’s renewed emphasis on domestic demand signals a shift in policy priorities, aiming to counterbalance external pressures such as US tariffs and global trade uncertainties. How effectively these strategies are implemented will determine whether China can achieve its ambitious economic goals in the coming year.

Disclaimer: This blog has been written exclusively for educational purposes. The securities mentioned are only examples and not recommendations. This does not constitute a personal recommendation/investment advice. It does not aim to influence any individual or entity to make investment decisions. Recipients should conduct their own research and assessments to form an independent opinion about investment decisions. 

Investments in the securities market are subject to market risks, read all the related documents carefully before investing.

In his first address to Congress after commencing his second term, United States President Donald Trump reiterated his strong stance on tariffs. He criticised what he described as “unfair” trade practices by several countries, particularly highlighting India and China for imposing high duties on American goods.

Trump underscored that the U.S. has long been subjected to disproportionate tariffs and vowed to take decisive action to level the playing field. He pointed out that certain nations impose significantly higher import duties on American products compared to what the U.S. levies on their exports.

India and China Targeted for High Tariffs

During his speech, Trump specifically mentioned India’s tariff on automobile imports, which he stated exceeds 100 per cent. He also drew attention to China’s average tariffs, which, according to him, are twice as high as those imposed by the U.S. Additionally, he claimed that South Korea’s tariffs on American products are four times higher than what the U.S. charges in return.

The President argued that these tariff imbalances put American businesses at a disadvantage, making it necessary for the U.S. to take reciprocal action.

Reciprocal Tariffs to Take Effect from April 2 – The Reason Behind the Date

Trump announced that the United States will introduce reciprocal tariffs on several nations starting April 2. Notably, he specified that the date was chosen deliberately to avoid coinciding with April Fools’ Day.

He explained that the tariffs would mirror the charges imposed by other countries on American goods. If a country places non-monetary restrictions on U.S. exports, the U.S. will implement similar trade barriers to limit their access to the American market.

Trump Highlights Economic Benefits of the Tariff Strategy

Trump asserted that these tariffs would generate “trillions of dollars” in revenue and create employment opportunities within the U.S. He cited his previous tariff policies on China and other nations as evidence of their effectiveness, claiming that the Biden administration could not reverse them due to their financial impact.

Expressing frustration over longstanding trade imbalances, Trump stated, “We have been taken advantage of for decades by nearly every country on Earth, and we will not let that happen any longer.”

Conclusion: Implications of the Reciprocal Tariffs

The imposition of reciprocal tariffs marks a significant shift in U.S. trade policy, potentially affecting global trade dynamics. The decision could impact businesses and industries reliant on international trade, particularly in sectors such as automotive, technology, and manufacturing.

As the policy comes into effect, stakeholders in both the U.S. and affected countries will be closely monitoring its economic consequences. The move is expected to trigger responses from trading partners, which may lead to further trade negotiations or retaliatory measures.

Disclaimer: This blog has been written exclusively for educational purposes. The securities mentioned are only examples and not recommendations. This does not constitute a personal recommendation/investment advice. It does not aim to influence any individual or entity to make investment decisions. Recipients should conduct their own research and assessments to form an independent opinion about investment decisions. 

Investments in the securities market are subject to market risks, read all the related documents carefully before investing.