‘The Thursday Rollercoaster’ | India Numbers Unveil Stability As World Braces For Impact

Thursday was a historic day of "flash crashes" and "V-shaped" recoveries across almost every asset class.

Gold & Silver: In a move that wiped out $3.4 trillion in notional value in hours, Gold plummeted from $5,625 to $5,100 before rebounding to close near $5,539. Silver followed an even wilder trajectory, swinging from $121 to $106 and settling back near $117.

Cause: Massive profit-taking triggered by "bubble" warnings from major banks (BofA/Citi) and algorithmic selling as prices hit parabolic peaks.

Stocks: The S&P 500 and Nasdaq faced early pressure from a 10% drop in Microsoft (cloud growth concerns). However, a late-day rally in "Old Economy" stocks helped indices close only slightly lower.

Treasurys: A "bull steepening" occurred. The 2-year yield fell to 3.53% (expecting Fed cuts), while the 10-year "long bond" stayed high at 4.85%, reflecting long-term inflation fears.

Bitcoin: Briefly sank below $85,000 during the commodity rout but found support as the "debasement trade" (distrust in fiat) resumed.

Oil: WTI Crude climbed above $65 for the first time since September, driven by Middle East tensions and a surprising draw in U.S. inventories.

The "Trump Factor": Friday’s Flashpoints

President Trump dominated the news cycle late Thursday with a flurry of actions that will dictate Friday's opening:

Fed Chair Replacement: Trump announced he will name his replacement for Jerome Powell on Friday morning. Frontrunners include Kevin Warsh (hawkish but pro-growth) and Rick Rieder (BlackRock). This will cause massive volatility in the USD and Bond markets.

IRS Lawsuit: Trump personally filed a $10 billion lawsuit against the IRS and Treasury Department over the 2019–2020 tax return leaks, accusing the agency of "political retribution."

Canadian Airplane "Decertification": In a shock move, Trump threatened to decertify all Canadian-made aircraft (Bombardier/De Havilland) until Canada certifies Gulfstream jets. This could ground over 2,000 U.S.-registered commercial and regional planes.

Currency War: Trump reiterated his preference for a weaker U.S. Dollar to boost exports, contributing to the "collapse" of the DXY index to 4-year lows.

India Market Outlook: Survey & Budget

The Indian markets are caught between global volatility and the most important domestic week of the year.

Economic Survey 2026: The “Reality Check”

GDP Growth: Projected at 7.4% for FY26, but tapering to 6.8%–7.2% for FY27.

Inflation: Historically low at 1.7% (April-Dec 2025), giving the RBI massive room to cut rates.

The Warning: The Survey flagged "State-level fiscal populism" (cash transfers) as a risk to national infrastructure spending.

Friday’s Outlook & Budget Expectations (Feb 1)

Gift Nifty: Signals a cautious/muted start as FPIs (Foreign Portfolio Investors) continue to sell despite the strong Survey numbers.

Budget "Whispers": Markets are pricing in a cap on LTCG (Long Term Capital Gains) at 12.5% and a massive ₹12 lakh crore Infrastructure outlay.

The "Hindustan Zinc" Effect: With the government sitting on a ₹40 lakh crore PSU goldmine, traders are watching for a "Mega Disinvestment" roadmap in the Budget to bridge the fiscal gap.

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