Asian Markets Trade Mixed Tracking Overnight Losses On Wall Street; Muted Start On D-Street Today?

[00:00:07]Good morning. You're watching Power Breakfast right here on CNBC TV18 on this penultimate trading day of the week. I'm Hormuz Fattakia. With me as always is Rasna Dhanrajani. Rasna, good morning to you.

[00:00:17]>> Morning to you as well, Hormuz. Let's start this day with some headlines then.

[00:00:20]Stocks on Wall Street close lower led by the S&P 500 and the Nasdaq ahead of key earnings from big tech companies.

[00:00:26]Treasury yields edged up while the dollar index also strengthened.

[00:00:33]>> Asia follows cues from Wall Street and has opened mixed. The GIFT Nifty is indicating a lower start for the Indian markets.

[00:00:40]>> Tensions in West Asia escalate. US continues to bomb Iran. Yemen's Houthi rebels attack two Saudi oil tankers.

[00:00:47]Iran's foreign minister warns their defense doctrine is an eye for an eye as President Donald Trump threatens to attack Iran's nuclear plants and bridges.

[00:00:58]>> Brent crude prices climb to a fresh six-week high and are now above $96 a barrel as escalating West Asia tensions heighten fears of deeper supply disruptions. Meanwhile, gold prices continue to remain above the $4,100 an ounce mark as dip buying and safe-haven demand offset concerns that higher oil prices could keep US interest rates elevated.

[00:01:20]>> In key earnings, Dr. Reddy's reports a weaker than estimated performance in Q1.

[00:01:25]Profit was hit by semaglutide API provision. And the big numbers to watch out for today will be from Infosys, which is expected to report 1.7% rise in revenue from last quarter. Also watch out for Cipla earnings, likely to deliver single-digit revenue growth this quarter.

[00:01:45]>> You know, over the last few months, the Asian markets and of course globes globe as well has been fairly disconnected from what India does because of the themes that are dominating the markets there. And today as well, the Taiwanese index are 3/10 of a percent higher. The Hang Seng is up 3/10 3/4 of a percent as well. But the Kospi on last check was up 4% and is extending its gains from yesterday's trading session as well. The Nikkei is higher as well. So both Nikkei and Kospi continue to outperform among the developed markets. The Kospi has cooled off slightly from the highs of the day still holding on to gains of 2 and 3/4 of a percent. That's not bad either because the stock index had ended well well over 3% higher yesterday as well.

[00:02:23]And the Nikkei too trading with gains of around 7/10 of a percent. The one common factor for all the markets though are the higher oil prices and but while the Wall Street markets and Asia is not reflecting that as of now, our markets are definitely reflecting that because Brent is now nearing 96 and it did cross 96 a few minutes ago. NYMEX too is trading with near the mark of $90 a barrel as well and that's showing up on the gift nifty.

[00:02:50]The index ended 200 points lower in yesterday's trading session and today too the implied open is suggesting a similar down tick and at this rate we open below the mark of 23,900 and that is something that the bulls will have to watch out for because now we come down to the lower end of the trading range that the nifty has found itself in which was 23,800 to 24,300. So does not look to be a positive start as of now. Oil prices are higher and the West Asia developments are to blame Rachna.

[00:03:19]>> Speaking of the West Asia developments, let's get you the updates from West Asia. The US bombs Iran for the 12th consecutive night as Iranian media report explosions in the cities of Bushehr, Ahvaz and Sirik. Now Iranian Minister of Foreign Affairs Abbas Araqchi says Tehran's defense doctrine is an eye for an eye. His comments came after US President Donald Trump warned that US forces would bomb an Iranian bridge or power plant every time Tehran shoots at a ship in the Strait of Hormuz. Elsewhere, Yemen's Houthis says it has carried out missile and drone strikes on two Saudi oil tankers in the Red Sea after declaring a maritime embargo on the kingdom.

[00:03:59]That's That's the global market action, but how will overnight cues impact the Indian market? We have our research team joining in with how the trade setup looks like and the stocks that are likely to be in news today. First up is Vivek joining us to get us all the market cues we need to watch out for today. Good morning, Vivek.

[00:04:17]>> Well, good morning. You know, like you mentioned, so much uncertainty especially as we see and we enter trade today morning. First up, you know, as far as the US indices are concerned, like you mentioned, all of the indices ended with cuts and post market too, you've seen quite sharp negative reactions to results that were declared post market as yesterday. Alphabet as well as Tesla among key draggers as far as the post market trading is concerned.

[00:04:38]All the key to watch out today, of course, will be oil prices yesterday above $95 a barrel, today hovering above the $96 a barrel and that is going to be a bit of a headwind as far as Indian equities are concerned today. Asian markets and gift nifty all indicating a gap down start. Remember, yesterday we ended below the 24,000 level and today's gift nifty is indicating a start below the 23,900 level. So, that too will continue to be a bit of a worry as far as the Indian market trading is concerned. Yesterday was a bit of a weak session. The nifty advanced decline ratio was at 1:4. 14 nifty stocks ended with cuts. Broader market decline was at 2:5 and one stock that clearly stood out was Bandhan Bank with very sharp cut seen post the ROE guidance cut. What is it that we'll be watching out for today?

[00:05:18]Well, expect earnings reactions to Dr. Reddy quite muted. IndusInd Bank on the positive side. HPCL, OFSS, NTPC green will be stocks that will react to results today. On the other hand, key results today include Infosys, Cipla, Indigo as well as Emphais. Markets will keep an key eye tone especially on commentary as far as these names are concerned and also primary market action continues to remain quite robust. Two fresh issues today open for subscription. Indo MIM and Lohia Corp are two companies that will open for subscription in the primary markets today.

[00:05:49]>> Uh well, the primary market action continues despite the uncertainties in the secondary market. Vivek, thank you for that update there. Over to Riya, who'll list out the long list of stocks that should be on your radar today.

[00:06:00]Riya, good morning.

[00:06:01]>> Well, good morning, Hormuz, and a long list of stocks indeed. Let's start off with Dr. Reddy's first. This time around, they have seen weaker than estimated performance. Quarter one profit has been hit by the 240 crore rupees semaglutide API provision, and revenue has also been lower largely due to uh the weaker uh US business this time around. IndusInd Bank, on the other hand, has posted a much stronger than expected quarter, with the NII beating estimates by 5%, PPOP by 20%, and net profit by 43%. United Spirits has also seen revenue growth ahead of estimates.

[00:06:31]However, the higher ad spends and exceptional items have dented the EBITDA as well as the net profit for them.

[00:06:36]HPCL, this time around, has reported a net loss of nearly 11,526 crores versus a net profit of around 4,900 crores uh in uh quarter uh four of FY26. Uh revenue, this time around, however, has gone up by nearly 22% on a sequential basis. For Schaeffler India, the net profit has uh increased by around 13% on a year-on-year basis, with the revenue also seeing an increase of nearly 17%.

[00:07:00]For Oracle Financial Services, we have seen revenue going up by 51% on a sequential basis and nearly 70% YOY as well, with strong EBITDA margin expansion, with the margins now standing at 60%. Further to this, uh the CEO of Oracle uh Finserve will also be stepping down, and in his uh Avdhoot Ketkar, which who is currently the CFO of the company, will be the new MD and CEO. For IIFL Finance, for quarter one, the AUM has crossed uh 1 lakh crores, uh growing by nearly 38% on a year-on-year basis, and the gold loan portfolio, which is a key growth driver, has seen an increase of nearly 114% on a year-on-year basis.

[00:07:35]For NTPC Green, we have seen revenue and EBITDA increasing by nearly 63% each on a year-on-year basis. And for ATGL as well, we have seen the net profit going up around 23% with EBITDA margins expanding sharply standing at nearly 23% in this quarter. And lastly, Sona Comstar will also be in focus as the company will be setting up a 49 to 51 JV for four what plant with Denso for electric and hybrid power trains. And the company will be transferring its a motor and controller business to the second JV with Denso buying for 49% stake at nearly 1,750 crores at an enterprise value.

[00:08:11]>> All right. Thank you so much Riya for that long list of stocks to watch out for today. Finally, let's get Sudarshan to get all the cues from the F&O space.

[00:08:18]Good morning, Sudarshan.

[00:08:20]>> Good morning, Rachna. Cues are not looking that great and thanks to the sharp rise that we are seeing in the crude price. It's like saying that Koi Aur Bhare Koi Aur. That's what we have been seeing in the for the Indian market. Things are happening somewhere else. The impact is happening here in the India and our two major indicators crude which is Brent has surged above the level of 95 US dollar 95 per barrel and the rupee which has seen a sharp depreciation against US dollar now trading around the levels of 96.50.

[00:08:50]Now talk about gift Nifty like yesterday, today also it's indicating a sharp down tick at least for the start and we might open around 23,900.

[00:08:58]Very important levels around 23,850 to 23,900. If we breach that level, next support comes around only 23,500. So that will attract very closely. Talking about FIIs and they have been sellers across the markets especially in the derivative market. You talk about stock futures, index futures, bank Nifty options, Nifty options, they have been sellers everywhere and also on the long side they have added just 724 contacts.

[00:09:24]But look at the short side addition is more than 23,000 contacts. Now long side exposure has come down to 8% and Nifty PCR also because of the aggressive call writing, there's a further down tick that we have seen. It has come down to 0.84 versus previous day's level of 1.01. In the options data on the put side, 24,000 and 23,500 have seen maximum change in the open interest, while on the call side, 24,000 24,200 have seen maximum change. So, it gives you the range from 23,500 to 24,200. So, first support for Nifty, 23,800. Next support comes around 23,500. Resistance will be 24,200. One stock remains the band, that is Gains Technologies. Some of the stock that I'll keep an eye on. First on OFS, yesterday had fallen almost 7%, but the company has come out with a very strong set of earning. SRF after the earnings has seen fresh short addition, and also Adani Green has seen fresh short addition.

[00:10:14]>> A petition to start a thought for the day segment with Sudarshan every day on Power Breakfast.

[00:10:20]There cannot be a better summation of that.

[00:10:23]Thank you for that, Sudarshan, and for the thought for the day as well. Take a short break, all the action from Wall Street on the other side. Stay tuned.

[00:10:55]Welcome back. You're watching Power Breakfast once again on BCT V18. Now, getting you the latest on Trump-related developments, we have Vinnie joining us in our special segment, Trump Watch.

[00:11:03]Good morning, Vinnie.

[00:11:05]>> Hi. Good morning. So, first up, let's talk about United States and Saudi Arabia. They have signed a civilian nuclear cooperation agreement, and the Energy Secretary, Chris Wright, and Saudi Energy Minister, Prince Abdul Aziz bin Salman, have signed what is called a Section 123 agreement along with a bilateral safeguard. Now, the pact is laying the legal groundwork for a 30-year multi-billion dollar partnership. American firms will be included in this, and they to help build out Saudi Arabia's civil nuclear capacity and the deal now heads to the Congress for a mandatory review. The energy secretary Chris Wright is insisting that this is strictly about a civilian power generation and not enrichment of weapons or anything on that sort as well. That's the word coming in here. But US President Donald Trump he's pivoted heavily into the economic messaging that he's had ahead of his midterms. He told the crowd that inflation is way down and credited his administration with a running the country properly while asking for patience on oil prices comparing it to his outreach to farmers as well. Moving on he also revisited Venezuela claiming that US operations there has paid off many many times over with both countries in his words now pulling tremendous amount of oil.

[00:12:25]The last commentary that we have coming in today is that President Trump also returned to health care reasserting that his administration will pass a great health care plan and that the plan was first unveiled back in January promising lower drug prices and subsidies sent directly to the patients as well. So that is what he's talking about. He's saying everyone should buy their own health care as well. But that's the update that we have from President Trump this morning and in his administration back to you guys.

[00:12:53]>> Vinnie thank you for that update there from the White House and in the US markets then?

[00:12:59]Well indices ended lower on Wednesday.

[00:13:01]They came off the highs very sharply as investors look to yet another busy day of corporate results. Well the Nasdaq was the underperformer falling 150 points more close to 6/10 of a percent.

[00:13:10]The S&P 500 and the Nasdaq both closed just below the flat lines. CNBC's Angelica Peoples gets us a wrap of all the action on Wall Street.

[00:13:18]>> US markets closed slightly lower on Wednesday ahead of the start of big tech earning season as traders monitored growing tensions in the Middle East. The Dow fell six points, the S&P 500 was down 10, and the Nasdaq dropped 146 points.

[00:13:33]The plaintiff in a social media addiction lawsuit against Meta has dropped its case, ending a trial set to start with jury selection in Los Angeles on Monday. The other three defendants in the case, TikTok, Snap, and Google, already settled with the plaintiff in this suit that alleged that social media companies were negligent about the addictive nature of their designs of their platforms. No word on the terms of those settlements.

[00:13:57]And OpenAI says that its own AI models went out and hacked another company during a planned test run. It was experimenting in a closed sandbox and didn't have internet access, but still managed to hack the startup Hugging Face. OpenAI now says that it's investigating the incident, and Hugging Face says that it was trying to use American models to fix this breath, but it was blocked by guardrails and was forced to use an open-source Chinese model, Z AI.

[00:14:23]That's what's happening here in the US.

[00:14:25]Back to you in Mumbai.

[00:14:27]>> All right, thank you so much, Angelique, for that update. Now, here's some opinion from Stephen Parker, co-head of global investment strategy at JP Morgan Private Bank, on the US market and earnings outlook. Listen in.

[00:14:40]>> The conversation that we were having back in December was this is all about the Mag 7 and the hyperscalers. And then look what happened this year. The Mag 7 is down and the market continues to move higher. Well, it's all about the tech sector, and then we saw disruption in the software space. And now we're seeing a big pullback in semiconductors. And yet, through all of that, the market is near all-time highs because we are seeing a broadening. Earnings are continuing to deliver. A lot of that is tech, but you look at industrials, utilities, financials, this is a broader story, and and that I think is really healthy. The early results look fantastic. Almost 90% of companies are beating expectations.

[00:15:17]Uh and so I do think the results are going to come in strong. What we have to recognize though is because of what we've seen in markets, because of higher expectations, companies that do miss or don't beat by enough are likely to see, you know, a lot of downside. You have to be prepared to to to manage around that and frankly look for some opportunities because volatility can be your friend when you get a little bit of this volatility.

[00:15:40]>> Take a short break. All the updates from the world of AI in our special segment the AI pulse on the other side. Stay tuned.

[00:16:01]Welcome back. The big result of the day comes from Infosys today mostly after market hours. Rima is here to tell us what the street is expecting, Rima.

[00:16:11]>> So, expect a good quarter from Infosys this time. Expectations are for a 1.8% revenue growth. The broad range is one going up to 2 and 1/2% constant currency quarter on quarter revenue growth. It's likely to be better than peers. So, barring a Tech Mahindra which had a 2.6% growth, Infosys' growth is likely to be better than a TCS which was at 0.4% and HCL Tech and Wipro this time were negative growth quarters. Uh the reason is the 2-month contribution from the two acquisitions that they did, Stratus and Optimum. Uh but remember this is going to be the fourth number, the fifth number that comes out. All the other large cap IT companies have already come out with their numbers. So, in that sense it's not going to give us more color maybe on the industry. But what's going to be critical for Infosys which the others don't give is the guidance.

[00:16:56]Infosys is the only large cap Indian IT company to give you a guidance. Now, currently for FY27 it stands at 1 and 1/2 to 3 and 1/2%.

[00:17:05]Some analysts believe the top end could be shaved down. It's hard for the company to hit 3 3 and 1/2%. So, maybe they'll bring down the upper end of the guidance. But if you add the acquisitions that they've done, the two ones I spoke about, then the guidance could look at two to four to two and a half to four and a half percent. The stock, like the rest of the pack, has struggled this year year-to-date in fees down 35% but from the 1st of July 52-week low, it's managed to recover about 7-8%. So, July per se hasn't been a bad month.

[00:17:34]>> Reema, thank you for that update there, the big number from Infosys later this evening. And now getting you the world of tech in our AI pulse segment, Rachna has hopped over to the wall to tell us just that, Rachna.

[00:17:46]>> Well, first up is Alphabet that beat second quarter revenue estimates with $119.8 billion against $116.9 billion expected. Now, Google Cloud rose 82% to $24.8 billion.

[00:17:59]It's fastest growth in many years. The stock still fell after hours with capital expenditure guidance for 2026 raised to as much as $205 billion.

[00:18:10]That spending is flowing to chip makers and AMD will invest up to $5 billion in Anthropic which deploys 2 gigawatts of Instinct MI450 GPUs from the first half of 2027. It follows similar deals with OpenAI and Meta in a market that still is heavily dominated by Nvidia. Then there's IBM that went the other way, cutting its full-year revenue growth forecast between 4 and 5%. Second quarter revenue was $17.16 billion against $17.58 billion expected as per LSEG. Now, the CFO said clients are shifting budgets towards AI hardware, not away from software. China's Moonshot AI that released K3, a 2.8 trillion parameter open weight model, it said it rivals Anthropic's Fable. Now, days later the White House science and technology chief alleged Moonshot distilled Fable to build it. The Treasury Secretary is weighing a blacklist and sanctions. The Chinese Embassy calls these claims unfounded.

[00:19:07]Then the Secretary of State Marco Rubio that told diplomats to push back on talk of an American tech kill switch after June's block on foreign access to mythos and fable as per a cable reviewed by Reuters. There is no government magic button, he said, the report quoted him.

[00:19:23]Amazon has confirmed layoffs in its AGI unit, its model silicon and quantum team without giving out the numbers. Now, more than 30,000 roles have already gone this year by Amazon.

[00:19:35]And after a rogue agent built on OpenAI technology breached hugging face the startup use Zefu, OpenAI open source GLM 5.2 to analyze the attack because leading American models refused to work.

[00:19:49]They had to turn the Chinese way. That's all we have from the world of AI for now. We'll get you more updates through the day.

[00:19:55]>> Rachna, thank you for that update there.

[00:19:57]Take your leave on this edition of Power Breakfast from Rachna and me. Thank you so much for watching. Bazaar Morning Call on the other side sets you up for the day's trade.