By theindianinvestor 
Tuesday, 8th April 2025
Time : 8:00 AM IST
Insights:
Global recovery sparks relief rally hopes!
1. Nifty fell by 742 points and closed at 22,161.
2. The first positive is that markets closed above 21,900, the recent low, and second, Indian markets didn’t fall as much as other Asian peers.
3. Yesterday, GIFT Nifty indicated a nearly 900-point gap-down. After opening, the market fell to 21,800 but recovered and closed above 22,100.
4. The fall was mainly due to panic over retaliatory tariffs by other countries on the US, as China imposed 34% tariffs.
5. However, other countries did not announce any retaliatory tariffs against the US, and most are in talks with the US for balanced trade relations.
6. Trump stated he is open to negotiations, aiming for either a trade surplus or at least a zero trade deficit.
7. India is unlikely to impose retaliatory tariffs against the US, indicating possible ongoing trade discussions.
8. This shows that US tariffs are being used as negotiation tools to improve US trade terms.
9. US markets ended negative but recovered most losses; NASDAQ was down 5% at one point but closed mildly positive, up 0.1%. Dow Futures are trading about 2% higher.
10. As US markets recovered, Asian markets are trading higher this morning — Japan’s Nikkei up 6%, Hang Seng up 1.8%, and China’s Shanghai index up 0.3%.
11. GIFT Nifty indicates a gap-up of over 300 points.
12. Interestingly, the big move yesterday was not Nifty’s fall but India VIX, which shot up nearly 68% to close at 22.79; this could crash today.
13. As NASDAQ ended mildly positive, IT stocks may outperform today.
14. Trump warned that if China doesn’t withdraw its 34% retaliatory tariffs by 8th April, the US will impose an additional 50% tariff effective from 9th April — let’s see how China responds.
15. Tomorrow, we have the RBI MPC meeting; markets expect a 25 bps rate cut. Any positive statement from RBI would be a big boost.
16. Crude is trading below $65/bbl, a good sign for India as we rely heavily on crude imports. If prices stay low, we could see retail petrol and diesel prices decrease.
17. The Dollar Index is trading just below 103, and US 10-year bond yields are around 4%.
18. Yesterday, FIIs net sold over ₹9,000 crore, but DIIs supported the market with over ₹12,000 crore of net buying in the cash market. FIIs added heavy shorts in index futures, increasing net shorts to 75% from 71%.
19. Nifty may take support around 22,000 and face resistance near 22,500.