In August 2025, the United States hit India with 50% tariffs, the steepest levied on any Asian economy as trade tensions with Washington boiled over.

Six months later, those duties have been slashed to 18%.

The stunning reversal followed months of stalled talks, rising geopolitical friction, and one explosive fault line: India’s Russian oil imports.

On February 2, 2026, the world’s two largest democracies unveiled a breakthrough trade pact, announced by Donald Trump on Truth Social and echoed by Narendra Modi on X.

India-US trade deal in visuals

The Russian oil trigger

The original trade standoff began in August 2025, when Donald Trump imposed a 25% penalty tariff specifically targeting India’s purchases of Russian crude, later stacked with reciprocal duties to reach 50%.

India had emerged as one of Russia’s largest oil buyers during the Ukraine war, capitalizing on deep discounts. 

That dependence became the single biggest obstacle to any trade deal.

The breakthrough came when Modi agreed to halt Russian oil imports entirely. 

Trump explicitly linked energy purchases to geopolitics, arguing that cutting oil revenues was essential to ending the Ukraine war. 

Venezuela was cited as a US-approved alternative supplier.

Trump said:

He agreed to stop buying Russian Oil, and to buy much more from the United States and, potentially, Venezuela.

The personal diplomacy factor

Beyond policy, the deal was driven by personal diplomacy.

Trump described Modi as “one of my greatest friends,” framing the agreement as proof that strong leaders can break deadlocks.

The two leaders reportedly spoke multiple times in December 2025 and again in early February, just days before the announcement.

The timing mattered. The US ambassador to India, Sergio Gor, had just taken office, calling the relationship’s potential “limitless.” 

Meanwhile, India’s advancing trade pact with the EU, dubbed the “mother of all deals” added urgency in Washington.

Modi’s response praised Trump’s “leadership” in advancing global peace, reinforcing the image of two dealmakers who “get things done.”

Market impact and what’s next

India’s Nifty 50 opened 4.86% higher on February 3 following the announcement, and was trading at 2.74% up at the time of writing.

Analysts expected markets to open 3% higher, marking a 1,000-point rebound from Budget-day lows.

Stocks of Indian companies Infosys, ICICI Bank, and Wipro gained over 2% at the start of the trading session.

Currency pressure on the rupee eased, as trade uncertainty has driven capital outflows. 

Rupee gained over 1% to trade at $90.25 at the time of writing.

Key export sectors to watch include IT services, pharma, chemicals, auto ancillaries, and engineering goods.

Still, officials caution that “technicalities remain to be worked out.”

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The Nifty 50 Index rose by over 3% on Tuesday as investors cheered the potential deal between the United States and India. It also rose as hopes of a deal between the US and Iran continued and as traders waited for the upcoming earnings of some of the biggest Indian companies. 

The blue-chip Nifty 50 Index has risen by 15% from its lowest level in April last year, underperforming top global indices like the TSX Composite, Nasdaq 100, and the S&P 500. 

Similarly, the Indian rupee rebounded, with the USD/INR has crashed from a high of 92.15 on January 28 to the current 90.34, its lowest level since January 21st.

US cuts Indian tariffs 

The Nifty 50 Index rebounded after Donald Trump announced that the US would cut tariffs to 18% from the last 25% after India agreed to stop buying Russian oil.

Trump noted that India would reduce tariffs and non-tariff barriers and then purchase US goods worth over $500 billion across sectors like energy, agriculture, and coal.

Analysts believe that the reduced tariff will help to boost the Indian economy by at least 0.2% this year, moving closer to 7%. That’s because the United States is one of the biggest markets for Indian goods. In a statement, a top analyst said: 

“Many in India would prefer to remain strategically unaligned, but if this rapprochement proves durable, India would likely gravitate back into the US bloc.”

Top Indian earnings ahead 

The Nifty 50 Index rally coincided with the broader rebound of the global stock market. Data shows that US equities continued rising on Monday.

The Dow Jones Index jumped by over 400 points, while the S&P 500 and the Nasdaq 100 indices rose by over 40 basis points.

Other global benchmarks like Canada’s TSX Composite, FTSE 100 and the German DAX also rebounded as the United States and Iranian negotiators started talking. The two sides are being facilitated by countries like Turkey and Qatar.

These talks explain why crude oil prices crashed, with Brent and the West Texas Intermediate falling to $66 and $62, respectively. 

Looking ahead, the next key catalysts for the Nifty 50 Index will be the upcoming earnings by some of the biggest constituent firms. Adani Ports, Adani Enterprises, and Bajaj Finance will publish their results on Tuesday.

Adani Enterprise stock jumped by 10%, while Bajaj Finance, Adani Ports, Jio Financial, and Eternal rose by over 5%. Other top gainers were companies like Shriram, Dr. Reddy’s, and Bajaj Finserv.

Similarly, Bajaj Finserv will release its earnings on Wednesday. Other companies like Bharti Airtel, Indian Oil, Tata Motors, Hero Motors. State Bank of India (SBI) will release its financial results on Saturday.

Most Indian companies like Larsen & Toubro, Maruti Suzuki, and NTPC released strong financial results last week.

Nifty 50 Index technical analysis 

Nifty 50 Index chart | Source: TradingView

The daily timeframe chart shows that the Nifty 50 Index pulled back to a low of 24,550 INR on Monday and then rebounded to a high of 26,310 INR. 

The index has formed an up-gap and 50-day and 100-day Exponential Moving Averages (EMA). It has risen above the Supertrend indicator.

Therefore, the most likely scenario is where the index continues rising as bulls target the next key resistance level at 26,000 INR. A drop below the key support level at 25,000 will invalidate the bullish outlook.

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The simultaneous selloff across gold, silver, oil, stocks, and crypto has sparked renewed debate over the efficacy of diversification, but financial experts warn against judging long-term strategies by a short-term “chaotic freeze-frame.”

The precious metals complex is currently more volatile than Bitcoin. 

Following months of record highs and investors treating them as a safe haven, investors finally began to dump both gold and silver.

“Gold is normally seen as a safety net – but lately, it’s felt more like a trampoline,” Finimize.com said in a report. 

Dramatic collapse in precious metals

The precious metals market has experienced a dramatic and sudden reversal of fortune. 

After reaching a record high just last week, god has suffered a significant collapse, tumbling by a striking 16% from its peak. 

This sharp decline signals a major shift in market sentiment and threatens to erase recent gains.

However, the volatility has been even more acute in the silver market.

Silver prices saw a truly catastrophic performance, crashing by a third (approximately 33%) on Friday alone. 

This single-day loss represents its worst performance since the year 1980, marking a historic and deeply troubling day for silver investors. 

Furthermore, the pain was not confined to the weekend, as these substantial losses continued to spill over into trading on Monday, suggesting a sustained and powerful wave of selling pressure that has gripped the entire metals complex. 

The current selloff follows a remarkable three-month rally.

During this period, gold’s price soared from $4,000 per ounce to over $5,500 per ounce, and silver more than doubled, leaping from approximately $50 an ounce to nearly $120 an ounce.

This widespread retreat suggested that investors were rapidly shedding their exposure to precious metals amidst broader market anxieties or shifts in monetary policy expectations.

The US dollar is likely to be further strengthened as investors anticipate the new Federal Reserve chairman, Kevin Warsh, will adopt an aggressive stance on inflation, leading to prolonged higher interest rates.

A strengthening dollar makes gold and silver more costly for international buyers. 

Diversifying with long-term perspective

This effect, combined with the decreased appeal of precious metals compared to interest-bearing assets when rates rise, creates a strong downward pressure on prices.

“To make matters worse, the fact that so many investors had piled into precious metals in recent months made the exit very crowded,” Finimize said. 

That means a lot of sellers and very few buyers, pushing prices even further down.

The simultaneous crash of gold, oil, stocks, and crypto in this selloff could lead one to conclude that diversification is pointless, as Finimize pointed out in its latest report. 

But that’s like judging a whole movie from a single chaotic freeze-frame.

See, in a rush for cash, investors don’t carefully prune based on long-term logic – they offload whatever they can sell quickly to plug holes elsewhere.

The information platform, which helps investors understand financial markets, said that assets with different long-term paths can often fall for the same reason in the short-term.

And smart diversification is about spreading out your risk over the long haul, rather than guaranteeing that nothing ever drops at the same time in a full-blown stampede. 

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Asia-Pacific markets rallied on Tuesday as investors reacted to a reported breakthrough in US-India trade talks, while risk sentiment was also shaped by volatile crypto markets, fresh political headlines from Washington, and a major deal in the artificial intelligence sector.

Below are the key developments shaping global markets.

Asian markets surge on US-India trade deal

Asia-Pacific equities jumped after Donald Trump said the United States and India had struck a trade agreement and would immediately begin cutting tariffs on each other’s goods.

In a Truth Social post on Monday, Trump added that Indian Prime Minister Narendra Modi had agreed to increase purchases of US products following a call between the two leaders.

Trump also said India would halt purchases of Russian crude oil and instead buy more from the US and potentially Venezuela.

India’s Nifty 50 surged nearly 5% at the open before paring gains, last trading up 2.99%, while the Sensex added 3.01%.

Japan’s Nikkei 225 climbed more than 3.9% to a record high, with the Topix rising 3.19%.

South Korea’s Kospi jumped more than 6.1%, triggering a buy-side sidecar — a mechanism that temporarily halts purchase orders.

The Korea Exchange said the trigger occurred after KOSPI 200 futures rose more than 5% for over one minute. The Kosdaq index gained 3.29%.

Hong Kong’s Hang Seng Index advanced 0.16%, while China’s CSI 300 rose 0.78%.

Australia’s S&P/ASX 200 climbed 0.89% after the Reserve Bank of Australia raised its policy rate by 25 basis points to 3.85%, its first hike since November 2023, citing persistently elevated inflation.

Bitcoin and precious metals remain volatile

Investors also continued to monitor sharp moves in commodities and digital assets following last week’s turbulence.

Silver prices plunged about 30% on Friday, marking the metal’s worst one-day drop since 1980, while gold fell nearly 10%.

On Tuesday, spot gold rebounded 3.67% to $4,830.94 per ounce, while silver rose 5.86% to $83.99 per ounce.

Bitcoin remained under pressure.

The cryptocurrency was hovering around $78,500 by midday in Singapore, after briefly rebounding from a 10-month low.

Data from Deribit showed that while downside protection via put options had eased, the highest concentration of puts pointed to $75,000 as a key support level, with the next support near $70,000.

Bitcoin’s implied volatility remained elevated at around 48.8, according to TradingView.

Trump seeks $1 billion damages from Harvard

In political news, Trump said late Monday that his administration is seeking $1 billion in damages from Harvard University.

In a Truth Social post, he said the administration wanted “One Billion Dollars in damages” and did not elaborate on the specific harms alleged.

The move follows the administration’s December appeal of a judge’s ruling that it unlawfully terminated more than $2 billion in grants to Harvard.

The university has been a focal point of Trump’s broader campaign to use federal funding to force changes at US universities, which he has accused of antisemitic and “radical left” ideologies.

SpaceX acquires xAI in major AI consolidation

Separately, Elon Musk said SpaceX has acquired his artificial intelligence group xAI, bringing together two of his most ambitious ventures.

Financial terms were not disclosed, but the combined entities are valued at just over $1 trillion based on recent funding rounds.

SpaceX was most recently valued at about $800 billion, while xAI secured a valuation of roughly $230 billion earlier this year.

Announcing the deal, Musk said the merger would help create “a sentient sun to understand the Universe and extend the light of consciousness to the stars.”

The acquisition follows xAI’s merger with Musk’s social media platform X last year and reinforces Musk’s strategy of vertical integration across data, compute and physical infrastructure.

For investors, the deal underscores Musk’s bet that scale and access to computing power will define the next phase of artificial intelligence development.

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Copper prices crashed from their record high perch last week as Chinese bulls retreated from a turbulent commodity market. 

The cross-commodity selloff also pulled down copper prices, which are currently over 10% lower than the peak reached last week.

Prices had topped a record $14,500 per ton on the London Metal Exchange last week, primarily driven by speculation and mine disruptions.  

However, prices have recovered somewhat, and were 1% higher on Tuesday as investors resorted to buying from lower levels. 

At the time of writing, the three-month contract on LME was at $13,099 per ton, up 1.3% from the previous close.

Fundamentals remain strong despite volatility

“Its fundamentals still look supportive, driven by tight mine supply, constrained growth in key producers, and strong structural demand linked to electrification and AI-related data‑centre build-outs,” Ewa Manthey, commodities strategist at ING Group, said in a note. 

The recent price surge has also kept many industrial users on the sidelines, but lower prices should now draw physical buyers back into the market, helping to stabilise demand. 

While copper is currently experiencing near-term volatility due to broader macroeconomic uncertainty—such as interest rate fears or global economic slowdown concerns—the fundamental bullish case for the metal remains strong. 

The underlying narrative driving copper demand is anchored by the global energy transition, which requires vast amounts of the metal for electrification, renewable energy infrastructure, and electric vehicles. 

Supply constraints, coupled with this secular demand growth, suggest that any current price weakness is temporary. 

Investors should view this dip not as a change in the long-term outlook but as a tactical buying opportunity. 

Once macro headwinds subside and market sentiment improves, this strong structural demand is expected to reassert itself, ultimately leading to renewed upward momentum in copper prices.

Secular demand growth: energy transition and AI

“Even though (Thursday’s) sharp rise in the price of copper was probably a speculative exaggeration and has since been corrected, medium-term factors continue to point to a structural increase in the price of copper,” Volkmar Baur, FX analyst at Commerzbank AG, said. 

As part of its forthcoming package of measures against Moscow, the European Union is currently contemplating sanctions.

These proposed sanctions would include a ban on importing several Russian platinum-group metals and copper.

Later this month, a proposal covering copper, platinum, rhodium, and iridium could be adopted, provided it receives unanimous approval from all member states.

Russia’s largest miner, MMC Norilsk Nickel, would be the primary target of these measures.

Until now, the company has avoided restrictions because of its critical role in global supply chains.

Sanctions and anticipated market deficit

“The potential ban comes at a time when markets for these metals are already tight,” Manthey added. 

Copper’s mine supply is constrained, while platinum is also expected to remain in deficit. This means any loss of Russian material would further tighten availability. 

Despite the International Copper Study Group’s report last week predicting a copper surplus in 2025 (covering January through November), expectations are growing that this trend will reverse, perhaps permanently, starting in 2026. 

The copper market is now widely anticipated to enter a deficit as early as 2026, a structural imbalance that is likely to persist for several years.

“On the one hand, this is driven by continuing growth in demand. Both the energy transition and artificial intelligence are driving up demand for copper,” Commerzbank’s Baur said. 

Global demand is projected to increase from roughly 26 million tons currently to 36 million tons over the next decade, a rise primarily driven by the ongoing energy transition, according to BNEF’s research unit.

Conversely, the supply remains constrained.

The rising demand is not being met due to a scarcity of new mining initiatives, coupled with the challenge of diminishing copper concentration in ores at operational mines.

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Nintendo on Tuesday reaffirmed its annual operating profit forecast of 370 billion yen, or about $2.4 billion, signalling confidence in its current console cycle even as investors debate how long early demand for the Switch 2 can be sustained.

The forecast implies a near one-third increase from the previous financial year and comes after the company launched the Switch 2 in mid-2025 with strong initial sales.

While the early momentum has supported earnings expectations, attention is now shifting to longer-term risks tied to pricing, supply chains, and the strength of the upcoming games slate.

The update places Nintendo at the centre of a broader conversation facing global hardware makers, as higher component costs and geopolitical disruptions challenge production economics.

Switch 2 momentum in focus

The Switch 2 succeeds the original Switch, one of the most commercially successful gaming devices ever released, and expectations for its lifecycle remain high.

Early sales have been described as robust, but investors are increasingly focused on whether demand can hold once the launch window fades.

Pricing differences between regions have become part of that discussion.

In the United States, the Switch 2 is priced at $449.99, compared with the Japanese-language version sold domestically for 49,980 yen, or about $320.

The higher US price is widely seen as reflecting inflationary conditions and higher operating costs in the market.

Experts note that Nintendo has limited room to push prices higher.

The Switch 2 is positioned as a mass-market device rather than a premium console, which could make aggressive price increases harder to justify if cost pressures intensify.

Trade tensions and supply risks

Nintendo’s hardware business continues to be shaped by external factors beyond consumer demand.

The company has had to manage supply chain disruptions linked to trade policies under US President Donald Trump, adding complexity to sourcing and logistics.

At the same time, hardware manufacturers across the industry are grappling with rising prices for memory chips, driven by surging investment in artificial intelligence.

These components are critical for modern gaming devices, and cost increases have begun to squeeze margins for companies without strong purchasing power.

Nintendo appears better placed than many peers to absorb these pressures in the near term.

Pricing discipline and margins

Concerns have surfaced about whether the Switch 2 could become less profitable as input costs rise.

However, experts continue to point to Nintendo’s long-standing pricing discipline as a key stabiliser.

Experts have noted that Nintendo follows a policy of not selling hardware at a loss, arguing that fears around Switch 2’s profitability are overdone.

This approach contrasts with strategies used by some competitors that rely on hardware subsidies to expand their user base.

Even so, the balance remains delicate.

While the higher US price helps protect margins, Nintendo faces constraints in passing on further cost increases without risking demand, particularly given the console’s broad audience.

Games pipeline under watch

Beyond hardware and pricing, the strength of Nintendo’s software pipeline is emerging as another focal point.

Some investors have expressed concern about the absence of immediate, high-profile releases from franchises such as The Legend of Zelda, which played a major role in driving sales of the original Switch.

Nintendo is set to release Mario Tennis Fever next week, adding fresh content to the Switch 2 lineup.

While not on the scale of a flagship Zelda title, the launch is expected to support engagement and near-term sales.

The pace at which Nintendo can roll out additional major titles will be closely monitored, as software depth has historically been a decisive factor in sustaining console demand over multiple years.

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The AI investment cycle is slowly entering a new phase where excitement around models and demos is now defined by balance sheets and capex plans.

And the amounts are extraordinary. Some say this might be the largest capex boom in history.

And there’s one specific company that has been dominating discussions since late 2022, and that is OpenAI.

Some even believe that the success of AI technology rests on Sam Altman’s shoulders.

But the past few weeks have shown some interesting developments which are worth a look, and perhaps an evaluation of opinions.

The AI capex boom not really concentrated

AI spending is no longer concentrated in one or two firms but is spread across the entire stack.

Nvidia continues to benefit as the primary supplier of high-end accelerators, with data centre revenue still growing at rates that justify aggressive capacity expansion.

Hyperscalers like Oracle are committing tens of billions each year to new data centres, power infrastructure, and networking, not as optional growth projects but as core strategy.

Microsoft, Amazon, Google, and Meta have all forecasted materially higher AI capex through 2026 and beyond.

These investments are being made even as investors grow more sensitive to near-term margins.

This matters because it shows where confidence actually sits. Capital is flowing first to infrastructure and distribution.

Model developers sit downstream of those decisions.

Read also: Nvidia puts brakes on $100B OpenAI buzz: what it means for NVDA stock

Hyperscalers are spending, but on their own terms

The recent market reaction to Microsoft’s earnings illustrated the tension clearly.

Azure continues to grow, but AI-related spending rose faster than near-term monetisation. The result was one of Microsoft’s sharpest single-day drawdowns in years.

The concern was not whether AI works, but how long margins stay under pressure.

That reaction is instructive. Hyperscalers can afford to absorb that pressure because AI strengthens their ecosystems.

A prime example here is Google, which continues to roll out major Chrome integrations with its Gemini model.

AI workloads pull customers deeper into cloud platforms. They increase switching costs. They justify higher long-term pricing.

Even if margins dip temporarily, the strategic logic holds.

But that logic does not apply in the same way to OpenAI.

OpenAI’s economics look very different

OpenAI’s projected spending path is extraordinary. Estimates point to cumulative losses approaching $100 billion through 2028, driven primarily by compute.

Revenue is growing fast, but the gap between revenue and cost remains wide.

To close that gap, OpenAI needs two things to happen at once. Revenue must scale at historic speed, and compute costs must fall sharply.

Both outcomes depend on forces largely outside OpenAI’s control.

Unlike hyperscalers, OpenAI does not own the infrastructure it depends on. It buys compute from Microsoft and potentially Amazon.

That means OpenAI is exposed to whichever layer of the stack ends up capturing most of the economic value.

If margins compress at the model layer, OpenAI feels it immediately.

Vertical integration is becoming the real advantage

This is where structural differences matter most.

Google designs its own chips, runs its own cloud, and distributes AI directly through Search, Chrome, Android, and Workspace.

When Google trains Gemini, much of the cost stays inside the company.

Meta is pursuing a different version of the same logic.

It funds AI spending through advertising cash flows, trains models for internal use first, and deploys them across products with billions of users.

AI improves engagement and pricing power even before direct monetisation.

Amazon benefits from AI demand regardless of which model wins. Every training run and inference request strengthens AWS.

Even reported discussions around large investments in OpenAI should be viewed through that lens. Amazon is buying exposure to demand, not betting its future on one model.

OpenAI is trying to move in this direction through partial ownership of compute projects and custom chip design.

Those efforts help, but they do not match the control enjoyed by vertically integrated peers.

Competition is eroding the idea of a single winner

The speed at which Google closed the perceived performance gap with Gemini has changed market expectations.

Distribution now matters more than benchmarks. Gemini does not need to be better in every task, as it only needs to be good enough and be everywhere.

When it comes to enterprise adoption, Anthropic has focused on regulated and technical use cases where long-term contracts are the core pursuit.

Enterprise customers care less about being on the absolute frontier and more about reliability, security, and support.

Consumer AI remains fluid because switching costs are minimal. There are no network effects comparable to social media or operating systems.

Users rotate based on preference, price, and convenience.

That combination points toward a market with several strong players rather than a single dominant one.

Apple has taken a notably cautious approach.

Rather than racing to build the largest models, Apple is integrating AI, which strengthens hardware and ecosystem lock-in.

Acquisitions such as Q.ai focus on device-level intelligence, not frontier compute.

Apple’s approach suggests that owning the user relationship may matter more than owning the most powerful model.

Now, Nvidia sits in a different position entirely. It sells the tools everyone needs, regardless of who wins at the model layer.

That is why reported hesitation around an outsized OpenAI investment is telling. Nvidia does not need OpenAI to dominate. It needs AI training and inference to continue scaling.

This distinction between enabling demand and owning demand is critical. It explains why infrastructure providers look increasingly attractive as AI exposure, while pure model economics look harder.

A likely outcome investors are underestimating

A realistic scenario is now visible. AI adoption accelerates, spending remains high, and several models coexist at similar capability levels.

That means prices fall, while infrastructure, chips, and platforms capture most of the value. Model developers compete harder for thinner margins.

But at the same time, investors are becoming more sensitive to higher spending without immediate results, as evidenced by Microsoft’s plunge.

What investors are looking for are distribution methods for these models.

They are looking for defensible moats, such as the ones being built by Google and Anthropic.

Higher spending doesn’t cut it anymore. The market just doesn’t have the appetite for it.

OpenAI can remain important without being the defining economic winner of the AI era.

That outcome would feel uncomfortable because recent tech history trained investors to expect concentration.

The next phase of AI may reward control over infrastructure, distribution, and balance sheets instead.

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Varun Beverages reported a strong set of quarterly results, with festive-season demand in India and steady overseas growth helping lift margins and profitability.

The performance was driven by higher sales volumes, lower borrowing costs, and additional income from currency movements and interest, underscoring the benefits of scale for one of the largest PepsiCo bottlers operating outside the United States.

Shares rose 4.9% in afternoon trade after the earnings announcement, reflecting investor confidence in the company’s operational momentum across both domestic and international markets.

The company said net profit rose 36% to 2.52 billion rupees, or $27.87 million, in the December quarter.

The improvement came despite a competitive consumer environment, as volume growth and cost efficiencies combined to support earnings.

Varun Beverages packages and distributes beverages under the Pepsi and Tropicana brands in India and several overseas markets, while also selling drinks under its own labels, such as Jive and Cream Bell.

Festive season boosts India volumes

India remained a key driver of growth during the quarter, supported by higher consumption during the festive period.

Sales volumes in the domestic market increased 10.5%, contributing to a 10.2% rise in consolidated volumes.

The seasonal uplift helped improve plant utilisation and distribution efficiency, allowing the company to spread fixed costs across a larger sales base.

Stronger volumes in India also reflected continued expansion in reach and availability across urban and semi-urban markets.

The company has been investing in capacity and logistics, which helped it respond to higher demand during peak consumption months without significant cost pressure.

Overseas markets add momentum

International operations continued to contribute meaningfully to growth, with volumes rising 10% in the quarter.

Africa was the strongest performer among overseas regions, reinforcing the importance of geographic diversification to the company’s business model.

Growth outside India helped balance seasonality and supported consolidated margins through scale benefits.

Favourable currency movements in some international markets also aided profitability.

The company said these currency gains, along with interest income on deposits, lifted other income during the quarter, adding to the overall improvement in earnings.

Revenue growth tracks volume expansion

Revenue from operations rose 13.5% year on year to 43.35 billion rupees in the December quarter.

The increase broadly tracked volume growth across regions, supported by product mix and consistent demand across categories.

Higher throughput allowed Varun Beverages to extract operating leverage, as incremental volumes contributed more directly to earnings.

The company’s diversified portfolio across carbonated beverages, juices, and value-added drinks helped maintain demand across different consumer segments, even as cost pressures remained a factor in the broader market.

Lower finance costs support margins

In addition to volume-led growth, lower finance costs played a key role in supporting margins during the quarter.

Reduced borrowing expenses eased pressure on profitability compared with earlier periods marked by higher interest rates.

Combined with higher other income, this helped strengthen net profit growth alongside operational gains.

Varun Beverages is one of PepsiCo India’s largest bottling partners, giving it exposure to some of the country’s most widely consumed beverage brands.

Its ability to deliver growth across India and overseas markets during the festive quarter highlights the resilience of its operating model and the benefits of scale in a competitive beverage sector.

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UK grocery inflation slowed again in late January, offering tentative relief to households still grappling with elevated living costs.

New figures from Worldpanel by Numerator show grocery price inflation eased to 4.0% in the four weeks to January 25, the lowest level since April last year.

The data provides an early read on food price pressures ahead of official UK inflation figures due on February 18.

Food costs remain a key focus for the Bank of England, which has repeatedly highlighted its role in shaping household inflation expectations.

Britain’s headline inflation stood at 3.4% in December, the highest among Group Seven economies, keeping pressure on policymakers and consumers alike.

Early signal ahead of inflation data

Worldpanel’s figures suggest that while price pressures are easing, grocery bills remain meaningfully higher than a year ago.

Inflation at 4.0% still implies continued cost increases, but at a slower pace than seen through much of 2024.

The timing is notable, as markets and policymakers look ahead to February’s official inflation release for clearer signals on whether broader price pressures are cooling.

Food inflation has been one of the more persistent components of UK consumer prices, making any sustained slowdown particularly significant for households and retailers.

Grocery spending grows as volumes lag

Despite easing inflation, total grocery spending continued to rise.

Worldpanel said UK grocery sales increased 3.8% year-on-year in value terms over the four-week period.

However, once inflation is stripped out, volumes declined, indicating that shoppers are still buying less in real terms.

This pattern underlines how consumers remain cautious, adjusting baskets and shopping habits rather than materially increasing consumption.

Price sensitivity continues to shape purchasing decisions, even as headline inflation indicators begin to soften.

Own label dominates baskets

Value considerations are increasingly shaping where and how shoppers spend.

Worldpanel said own-label products hit a record high, accounting for more than half of all grocery spending over the period.

The shift highlights continued trading down by consumers seeking cheaper alternatives amid lingering cost pressures.

The trend has become a structural feature of the UK grocery market, benefiting retailers with strong private-label ranges and squeezing branded suppliers facing tougher price negotiations and slower volume growth.

Winners and losers among retailers

Market share movements over the 12 weeks to January 25 show a widening gap between stronger performers and those under pressure.

Industry leader Tesco recorded sales growth of 4.4% year-on-year, lifting its market share by 20 basis points to 28.7%.

Second-placed Sainsbury’s posted faster growth, with sales up 5.3%, taking its share to 16.2%.

Discounters continued to outperform, with Lidl GB remaining the fastest-growing bricks-and-mortar retailer as sales climbed 10.1%.

Online, Ocado stayed the fastest-growing overall, reporting sales growth of 14.1%. In contrast, Asda continued to lose ground.

Its sales fell 3.7%, pushing its market share down 80 basis points year-on-year to 11.5%, underscoring ongoing challenges in a highly competitive market.

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The German DAX Index rebounded on Tuesday, rising by 1.10%, and nearing its all-time high of €25,500. It has jumped by 35% from its lowest level in April last year. This article looks at some of the key catalysts or news that will move German stocks.

DAX Index to react to ECB interest rate decision 

A key catalyst for the DAX Index is the upcoming European Central Bank (ECB) interest rate decision, which will come out on Thursday this week.

This decision will come a day after Eurostat releases the latest consumer inflation report. Economists polled by Reuters expect the upcoming report to show that the headline Consumer Price Index (CPI) dropped to 1.7% in January, much lower than the ECB target of 2.0%.

The ECB has now achieved its goal of bringing inflation to 2% while the economy is doing well. This growth has been helped by the robust spending by European economies. 

Therefore, most economists believe that the ECB will leave interest rates unchanged at 2% this year and then start hiking in the coming year. This explains why the euro and German bond yields have continued rising.

Key German earnings 

The DAX Index has done well in the past few weeks as some key German companies published strong financial results. The most notable of them was Deutsche Bank, which benefited from the strong economy and investment banking.

Infineon, a major company with a market capitalization of over $67 billion will publish its numbers on Wednesday. It will be followed by Linde and Siemens Healthineers, which are valued at over $218 billion and $56 billion, respectively.

The other key companies to watch will be those that will publish their financial results next week are Siemens Energy, Commerzbank, Siemens, Mercedes-Benz, and Deutsche Boerse. 

Commerzbank will be in focus as it releases its financial results, which are expected to be strong as other European banks have done.

Additionally, the DAX Index will react to this week’s US earnings dump by companies like Amazon and Google. Some of the other top companies that will publish their numbers this week are AMD, Merck, Eli Lilly, AbbVie, and Qualcomm.

US and Iran talks 

The other major catalyst for the DAX Index will be on geopolitics. Indeed, the index has done well this week because tensions between the United States and Iran have eased.

The two sides have started talking, which has reduced tensions between the two countries. This explains why the price of crude oil has crashed this week.

Still, a lot can change as we saw last year when Israel attacked Iran as it was talking with the United States. Therefore, deteriorating talks between the two countries will lead to elevated tensions, which will knock the DAX and other indices.

The other major catalyst for the index will be a potential interview of Kevin Warsh, who was named the Federal Reserve Chairman nominee. 

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