US SUPREME COURT CALL’S OFF TARIFF: DUMB’OLD TRUMP NIFTY MAY REJOICE BUT 26400 REMAINS A LAKSMAN REKHA

Markets are tended to rejoice as US Supreme Court calls Trump tariff illegal although trump still chatter’s about implementing 10% additional tariffs on all the countries across the globe. Though nifty is poised for a good gap up opening on Monday it is once again likely to follow Lakshman Rekha on the ATH levels of 26400. Until & unless it sustains above this we aren’t going anywhere. However, broader move may remain upward with positive bias.
In all these times where Nifty revived from subdued levels of 24571.75 to 26341.20 FII’s were secretly reducing their short positions significantly. Their short position in Index as on 23^rd Jan.’26 was highest at 2.28 Lacs which so far came down to only at 1.34 Lacs contracts which resembles the positive bias from them but in a secret way which nobody realized so far.

The institutional investors FII’s were marginal sellers with net sell of Rs. 637.68 cr. worth of equities while DII’s remained net buyers with buying of Rs. 4,335.23 cr. FII’s remainedmarginal net sellers so far in the month of February 2026 with net outflow of Rs. 2,011.24 cr. while DII’s once again remains massive buyers so far with net inflow of Rs. 14,111.18 cr. for the month. DII’s remains main supporter of the Indian Equity markets in February 2026 month.
Precious metals initially cool off but closed almost neutral with no possible impact in the equities expected in the coming week ahead. Gold corrected nearly 24.67% from its recent highs of 180779 to hit a low of 136185 a biggest decline in a single week while it now remained inline with nominal gain last week while in Silver which made highs of 420048 & gave a vertical dive towards 225805 a single-handed fall of nearly 46.25% a biggest fall in the history within 2 weeks’ time frame. As earlier mentioned, meltdown in precious metal has lead investors with a ray of hope as once an asset class crashes investors seek shelter to another asset class which basically here is Equity. This melt down may result in inflow into the Capital markets gradually.

Though rupee fall has been a big issue lately but it has shown some recovery towards 90.022 & if things get back in favor, broader market may try to follow up the positive momentum.

FII’s have been into net sell in 7 months out of 10 in current Fiscal year 2025-26 creating ruckus pressure on the entire markets. In the traders / investors community it has now become a basic question why they are selling? & When this selling would stop?

Why FII’s have been continuously selling in Indian Markets?
In recently launched GDP growth rate of India in Q2 has been 8.20%. At the same time, it is being projected that it will grow at 7.30% in the Fiscal year 2025-26 while USA has recently shown a GDP growth rate of 4.40% which is furthermore projected to grow at 4.70% so for a Developed economy which is showing nearly 5% of growth lately. In contrast, target country which is still a Developing country with a projected growth rate of 7.30% but its currency is declining on a fast scale why would any institutions go for a Emerging Markets when it can get a growth of nearly 5% in an already developed nation while saving currency devaluation risk. Isn’t it a safer investment for them?
Well, ofcourse yes this could have been a major reason for FII’s to relentlessly sell into the Indian Equity markets.
But now FII’s have covered their shorts to 1.34 lacs from 2.28 lacs contracts earlier their short position in Index as on 23^rd Jan.’26 was highest at 2.28 Lacs which so far came down to only at 1.34 Lacs contracts which resembles the positive bias from them but in a secret way which nobody realized so far.
Nifty last week remained indecisive throughout the week with both sides move confusing both Bulls & Bears. In Nifty the crucial support now remains higher 25300-25400 kind of levels while on the upside 26400 now may act as immediate hurdle or you can say Lakhsman Rekha. Any move above this we may witness open blue-sky zone.

This time positive support could be from Private banks followed by Reality sector but certain PSU stocks could also be seen into performance. Specific certain heavy weights like Reliance Industries & HDFC Bank etc.

Bank Nifty may now show crucial support within the range of 59500-60000 kind of levels while on the upside potential upside we may get 62000 kind of levels on an immediate basis.Likewise Private heavy weight banks this time may show some relief rally along with PSU Banks.
Nifty IT may find its crucial support within the range of 31000-31500 kind of levels while a recovery could be seen towards 35000-35500 kind of levels on an immediate basis.

We clearly mentioned earlier that Nifty’s pressure only resembles the pressure of political will rather than fundamental one. FII’s selling has kept its pressure intact to the Indian domestic Equity markets as it went lesser last month the real realization came forward& now the Indian markets growth story rises & the politically backed selling with pressure from the Trump administration to diminish the Indian markets & create an artificial pressure to put an end to the Indo-Russia friendship remains untouched.

Now a India-US trade deal looks a positive flow of FII’s may come again into the Indian Equity markets.

India remained on the higher ground on GDP data front where it achieved a milestone with historic growth rate of 7.80% in Q1 & 8.20% in Q2 of FY 25-26 completely mocking Trump’s “Dead Economy” jibe at its face where India remained on the Top-notch developing economy set for a target of $25 Trillion economy by 2047 on track. However, chairman of Reliance Industries Limited Mr. Mukesh Ambani said in its latest AGM last week that India has the capacity to achieve 10% GDP growth annually which once again has set another long-lasting futuristic goal for the entire economy.

FII & DII’s monthly data so far in the FY 2025-26 has been interesting where FII’s bought in few months initially then abstain from buying or remained to being on the sell side while DII’s remained the biggest supporter of the broader markets. The data below mentioned:

Brent Crude may remain sideways in the coming week ahead.

However, in Nifty we have previously mentioned that Nifty in the last five months mainly March-April-May & so far in June 2025 shown immense strong rally from the lower levels of 21743.65 to testing high’s of 26372.80 in January 2026 came a long way of recovery almost 20% from the lower levels forming consecutive 4 bullish candles on monthly charts which suggests the continuation of bullish move ahead in the month of June as well as in July followed by massive growth in India’s Q1 GDP of 7.80%& Q2 GDP of 8.20%.

The Indian Equity markets have gained many recent news items where major of the news items are mentioned below:

• Rupeemay hit 88-90 range in the coming week ahead.

• Dollar Indexmay hit 96 kind of levels.

• Brent Crude may remain sideways in the coming week ahead.

On the other side FII’s net longs now near to 24%& stayed stable with consistent recovery as of now which signifies minimum downside while potential upside could be remains at large which continuously signifies &now support could be within the range of25300-25400 in Nifty. Now we expect the FII’s long positions to rise further towards 36% in the coming weeks ahead which may take Nifty & broader markets again on the higher levels.

In the wholesome broader markets witnessed some key events & their outcomes last week which are described as follows:

Domestic News:

1. Vibrant Villages Programme-II: Union Home Minister Amit Shah launched the second phase of this program in Assam to boost infrastructure and security in border villages.

2. Core Sector Slowdown: India’s eight core infrastructure sectors grew by 4% in January 2026, a slowdown from December’s 4.7%, primarily weighed down by a contraction in the crude oil and natural gas sectors.

3. India-U.S. Trade Deal: Despite the new tariffs, Trump confirmed that the specific parameters of the India-U.S. trade deal signed on February 2 remain unchanged, stating, “They’ll be paying tariffs, and we will not be paying tariffs.”

4. India’s Steel Diversification: In response to the EU’s carbon tax (CBAM), India is aggressively seeking new steel export markets in the Middle East and Southeast Asia to offset its reliance on European buyers.

5. Private Credit Market Stress: Financial markets are reacting to significant volatility in the private credit sector. Blue Owl Capital’s move to sell $1.4 billion in assets and halt redemptions in one of its funds has triggered a sell-off in shares of major alternative asset managers like Blackstone and KKR.

6. RBI Economic Outlook: The latest RBI Bulletin suggests that India’s near-term economic outlook remains favorable despite global volatility.

7. Fertiliser Industry Controls: Reports highlight the increasing government control over the fertiliser industry, with the Uttar Pradesh government recently banning the sale of non-subsidised fertilisers by certain manufacturers.

8. Google’s AI Hub: CEO Sundar Pichai remarked on Visakhapatnam’s rapid growth as a global AI hub.

9. AI “Scare Trading”: Markets remain nervous regarding the impact of generative AI on India’s $300 billion IT services industry, especially following the release of advanced models like GPT-5.3 Codex and Opus 4.6.

10. India AI Summit 2026 (Day 5): The summit continues in New Delhi. Recent highlights include a meeting between Karnataka Minister Priyank Kharge and the Anthropic team to discuss potential AI partnerships.

11. FDI Outflow Concerns: Net Foreign Direct Investment (FDI) into India has remained negative for the fourth consecutive month, as outward repatriation of capital reached record highs.

12. LIC Increases Cipla Stake: Life Insurance Corporation of India (LIC) has raised its holding in pharmaceutical major Cipla to 9%.

 International news:

1. Trump states that nothing has changed regarding the India trade deal, with no updates or alterations announced.

2. Brazil’s Lula says India-Brazil trade deals need not use US dollars; local currencies can work. His eyes $30-40B trade volume, plans drug trafficking/rare earths talks with Trump, denies BRICS new currency debate.

3. India-U.S. Trade Deal: Despite the new tariffs, Trump confirmed that the specific parameters of the India-U.S. trade deal signed on February 2 remains unchanged, stating, “They’ll be paying tariffs, and we will not be paying tariffs.”

4. The US Supreme Court ruled President Trump lacks authority under IEEPA to impose tariffs. This limits executive power on trade, prompting Trump’s workaround with a new 10% global tariff.

5. US President Trump will travel to China from March 31 to April 2 to meet Xi Jinping. The trip follows the Supreme Court’s tariff ruling, focusing on trade talks and tensions like Taiwan.

6. White House announces President Trump will hold a press briefing on the Supreme Court’s tariff decision at 12:45 PM ET.

7. Trump says nothing has changed regarding the India trade deal. This follows Supreme Court tariff ruling and his new 10% global tariff workaround.

8. “AI Scare Trade” Recovery: After a massive selloff in the Indian IT sector (wiping out nearly $56 billion in market cap earlier this week due to AI disruption fears), some analysts are beginning to view the dip as an “opportunity in disguise,” noting that valuations are at their lowest since 2023.

9. Bond Inflows: Asian local currency bonds (specifically in South Korea, Thailand, and Malaysia) continue to attract foreign interest for the fourth consecutive month, though at a more moderate pace than in December.

10. Lunar New Year Impact: Trading volumes across Asia remain thin as major markets in Mainland China and Taiwan continue to observe the Lunar New Year holidays.

11. Impact on Global Dynamics: The ruling is expected to reset trade dynamics with key partners like the EU, Japan, and South Korea, as many “Liberation Day” tariffs are now legally invalid.

Nifty last week initially remained volatile where it hit lower end of the crucial support levels at 253712.70 while high’s were near to 25885.30 with a decisive close at 25454.35. Nifty last week remained indecisive throughout the week with both sides move confusing both Bulls & Bears. In Nifty the crucial support now remains higher 25300-25400 kind of levels while on the upside 26400 now may act as immediate hurdle or you can say Lakhsman Rekha. Any move above this we may witness open blue-sky zone.

This time positive support could be from Private banks followed by Reality sector but certain PSU stocks could also be seen into performance. Specific certain heavy weights like Reliance Industries & HDFC Bank etc.

Bank Nifty may now show crucial support within the range of 59500-60000 kind of levels while on the upside potential upside we may get 62000 kind of levels on an immediate basis.Likewise Private heavy weight banks this time may show some relief rally along with PSU Banks.

Nifty IT may find its crucial support within the range of 31000-31500 kind of levels while a recovery could be seen towards 35000-35500 kind of levels on an immediate basis.

Sensex made high last week at 83979.36 to give a close at 82498.14. Sensex may find its crucial support within the lower levels of 81000 kind of levels while on the upside 85000-86000 remains as a immediate target zone.

Nifty Financials now have immediate target of 29000 while on the downside crucial supports shifted higher at 27900-28000 kind of levels.

As of January 2026 the number of Demat Accounts has hit whopping 21.6 crores this not only helps the capital markets directly but also directly to Equity investments.

The monthly SIP in Indian markets now raised towards Rs. 31,002 cr. per month as on December 2025. 

Brief Levels of Nifty / Sensex/ Bank Nifty / Nifty Financials / Nifty IT:

Nifty CMP:  25454.35
Nifty Potential Immediate Target / Hurdle :26400
Nifty Immediate Crucial Support:25300-25400

Sensex CMP: 82498.14
Sensex Immediate Target Hurdle: 85000-86000
Sensex Immediate Crucial Support: 81000

Bank Nifty CMP:  61172
Bank Nifty Immediate Target: 62000
Bank Nifty Immediate Crucial Support: 59500-60000

Nifty Financial CMP: 28210.60
Nifty Financial Immediate Hurdle: 29000
Nifty Financial Immediate Downside Target: 27900-28000

Nifty IT CMP: 32319.40
Nifty IT Immediate Target: 35000-35500
Nifty IT Immediate Crucial Support: 31000-31500

Stock on Radar:

Large Caps:

• TCS (CMP 2686): If India-US trade issues gets resolved TCS may hit 2800-2900 on an immediate basis from current levels of 2686 with strict SL placed at 2500.

• Godfrey Phillips (CMP 2487): This large-cap counter may outperform CMP 2788 with strict SL placed at 2000 one can expect a potential upside towards 2800-3000 kind of levels in short term.

• LIC India (CMP 873): Thie large-cap PSU counter looks good to add here at CMP 873 with strict SL placed at 800 on can expect an upside towards 990 in medium term

About the Author:

Mr. Vishal Gupta a SEBI Registered Research Analyst is the founder of “VG STOCK RESEARCH”, founder of “THE ANALYSIS ROOM”, a writer & an advisor having rich experience in Indian Equity Markets who has spent years comprehending an industry wide shift and risk management with more than 13+ years exploring in depth analysis of the Equity & Derivatives.
He has also been into teaching Fundamental Analysis for quite some time giving investors/traders comprehensive knowledge & skills of Indian Equity Markets.

Email I’d: contact@vgstockresearch.com
Contact: +91-9953934544
Website: https://vgstockresearch.com/
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