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Global Sentiment: Risk-on
Factors:  EU-Tariff Delay

TODAY’S WATCHLIST
 - ECB President Lagarde Speaks  

THE BIG STORY
India has officially surpassed Japan to become the world’s fourth-largest economy, according to the International Monetary Fund’s April 2025 World Economic Outlook. The IMF projects India’s GDP for FY 2025–26 at $4.187 trillion, just ahead of Japan’s $4.186 trillion for calendar year 2025.

NITI Aayog CEO B V R Subrahmanyam confirmed the milestone, adding that India could surpass Germany to become the third-largest economy in the next 2.5 to 3 years. India’s economy for FY25 has been revised upward to ₹331 trillion from the earlier estimate of ₹324 trillion. While India’s GDP growth is expected to slow to 6.5% in FY25 from 9.2% the previous year, the IMF projects an even wider gap between India and Japan in the coming years. India’s GDP for FY 2026–27 is forecast at $4.601 trillion, compared to Japan’s $4.373 trillion.

DATA
US new single-family home sales surged 10.9% in April to a seasonally adjusted annual rate of 743,000 units, the highest since February 2022, as builders cut prices to attract buyers. However, February and March sales were revised lower, tempering the optimism. The March sales pace was revised down to 670,000 units from 724,000, while February's was cut to 653,000 from 674,000. Rising mortgage rates and economic uncertainty continue to weigh on the housing market.

WHAT HAPPENED OVERNIGHT
US stocks fell on Friday, closing out a losing week as President Trump proposed 50% tariffs on European goods, stoking global trade tensions. All major indexes dropped, with the S&P 500 losing over 2% for the week. Tech, communication services, and consumer discretionary stocks led the declines, while utilities, consumer staples, and energy stocks gained. Apple hit a two-week low and fell 3% after Trump’s tariff warning on foreign-made iPhones.

US Treasury yields eased on Friday, with the 10-year note falling 4.4 basis points to 4.509%, down from a three-month high of 4.64% in the previous session. The decline came as markets refocused on growth concerns after President Trump recommended 50% tariffs on the EU starting next month, raising fears of a trade war escalation. The move also dampened hopes for tariff de-escalation with China. Longer-dated yields fell after surging on news that Trump’s tax and spending bill, passed by the House, is set to widen the federal deficit by nearly $4 trillion, adding to the existing $36 trillion debt burden.  

The US dollar fell sharply on Friday as investors sold the currency after President Donald Trump recommended 50% tariffs on the European Union starting June 1. The euro climbed 0.8% to $1.1363, hitting a two-week peak and heading for its biggest weekly gain in six weeks. The dollar index dropped 0.8% to 99.09, marking a three-week low and a 1.9% weekly loss, its largest since early April.

Brent crude oil prices rose on Friday as US traders covered positions ahead of the long Memorial Day weekend and amid concerns over nuclear talks between US and Iran. Brent crude settled up 0.54%, at $64.78 a barrel, while US West Texas Intermediate rose 0.54%, to $61.53.

Day’s Ledger

Corporate Actions

• Jan-Mar earnings: Action Construction Equipment, Ajooni Biotech, Aurobindo Pharma, Bafna Pharmaceuticals, Balaji Amines, Blue Dart Express, Fertilizers and Chemicals Travancore, General Insurance Corporation of India, Gillette India, India Pesticides, Jindal Drilling and Industries, KEC International, Lyka Labs, Maharashtra Seamless, Monte Carlo Fashions, Nazara Technologies, PTC India, Saksoft, Sundaram Brake Linings, and Venus Remedies

Policy Events

• ECB President Lagarde Speaks  
• German Buba President Nagel Speaks

TICKERS

• GLENMARK PHARMA’s March quarter revenue rose 6.3% YoY to ₹32.56 billion, up from ₹30.63 billion.  Adjusted PAT stood at ₹3.47 billion with 10.6% margin.
• BALKRISHNA INDUSTRIES’s March quarter standalone net profit dropped 25% to ₹3.62 billion. Revenue increased 5% YoY to ₹28.38 billion in the quarter.
• JSW STEEL March quarter net profit rose 14% YoY to ₹15.01 billion. Performance aided by stable steel demand and pricing.
• UNION BANK OF INDIA reported that RBI imposed ₹6.36 million penalty for non-compliance. Violations pertained to depositor fund transfers and agricultural lending norms.
• PARAS DEFENCE AND SPACE TECHNOLOGIES Announced joint venture with Israel's Heven Drones Ltd. New Indian subsidiary to develop logistics and cargo drones for defence and civil use.
• ASHOK LEYLAND declared 1:1 bonus share issue; first since 2011, also announced dividend of ₹4.25/share, totalling ₹12.48 billion.
• FINOLEX INDUSTRIES’  March  quarter revenue fell 5% YoY to ₹11.72 billion. Net profit was flat at ₹1.65 billion.
• NTPC’s March quarter net profit rose 22.6% sequentially to ₹57.78 billion. Revenue increased 6% to ₹439.04 billion from ₹413.68 billion in Q3.
• ASHOKA BUILDCON’s March quarter net profit jumped 73.2% YoY to ₹4.32 billion from ₹2.50 billion. Revenue for the quarter was ₹26.94 billion, down from ₹30.52 billion last year.
• GE VERNOVA T&D INDIA’s March quarter net profit surged nearly 3x YoY to ₹1.86 billion. Revenue rose to ₹11.74 billion from ₹9.19 billion last year.

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