Indian Handset Sector & Equities Brace for Budget Impact as Markets Navigate Global Uncertainty

India’s stock market is poised for a cautious start this Friday as investors digest a torrent of corporate earnings announcements and position ahead of the Union Budget presentation, a pivotal event that could reshape market sentiment and sector allocations including the closely watched handset manufacturing segment.

The Sensex and Nifty benchmarks had staged a modest rebound on Thursday, each climbing approximately 0.3 percent, buoyed by encouraging macroeconomic data. India’s real GDP growth for FY26 has been pegged at 7.4 percent, with Gross Value Added expanding at 7.3 percent, underscoring the nation’s continued status as the world’s fastest-growing major economy for the fourth straight year. “India stands as an oasis of economic strength in an otherwise challenged global landscape,” remarked Chief Economic Adviser V.A. Anantha Nageswaran, emphasizing the stark contrast between India’s performance and global growth trajectories.

Earnings Season Tests Corporate Health & Market Conviction

The flurry of quarterly results has created a bifurcated earnings landscape. Several blue-chip companies including ITC, Vedanta, Dixon Tech, Voltas, and Blue Star disclosed their quarterly performance after market hours, while heavyweight names such as Bajaj Auto, Bank of Baroda, Blue Dart, NALCO, and Nestle were scheduled to report during Friday’s trading session. These results will be critical in determining whether the handset industry and allied electronic goods manufacturers can sustain margin expansion amid input cost pressures—a concern echoing across technology-dependent sectors.

Currency Pressures & Capital Flows Paint Mixed Picture

The Indian rupee experienced notable volatility, slipping to near the psychologically significant 92 level before recovering to close marginally weaker at 91.96 per US dollar. The weakness stems from pronounced dollar demand tied to derivative contract expirations and corporate hedging operations. On the capital flows front, foreign institutional investors liquidated shares worth Rs 394 crore on a net basis, signaling cautious sentiment among overseas participants. Conversely, domestic institutional investors demonstrated conviction by accumulating Rs 2,634 crore worth of equities, suggesting confidence among local money managers despite near-term headwinds.

Global Markets Sputtering Amid AI & Trade Jitters

Across global markets, the mood remains decidedly fragile. Asian equities displayed a mixed tone Friday morning, while US equity futures retreated as Apple issued cautionary guidance on margin compression, reigniting questions about the sustainability of artificial intelligence-driven investment returns. Trade tensions continued to unsettle investors following US President Donald Trump’s announcement regarding de-certification of Canadian-made aircraft and the signing of an executive order targeting trade tariffs against nations supplying oil to Cuba.

One modest positive development emerged as US Senators reached a provisional agreement to avert a partial government shutdown originally slated for Saturday. President Trump also signaled he would unveil his Federal Reserve chair nominee Friday morning, adding another layer of policy uncertainty.

Asset Class Rotations: Gold Soars, Oil Steadies

Precious metals displayed remarkable strength, with spot gold rebounding from record highs but still commanding prices below $5,300 per ounce—having surged nearly 24 percent during January alone, pacing toward its best monthly performance since the 1980s. Crude oil hovered near multi-month peaks, supported by geopolitical concerns about potential US military action against Iran and subsequent disruption to Middle Eastern supply flows. Oil futures retreated nearly 1 percent in Asian trading after gaining more than 3 percent during the prior New York session, though prices remained elevated on a monthly basis.

Wall Street Closes on Hesitant Note; European Equities Mixed

US equity markets wrapped the prior session with modest losses following Microsoft’s revelation of slower cloud business expansion. The Dow managed a marginal 0.1 percent gain after recovering from an intraday selloff, while the S&P 500 edged down 0.1 percent and the technology-centric Nasdaq Composite declined 0.7 percent. European bourses displayed mixed performance as investors absorbed earnings updates from continent-listed stalwarts. The pan-European Stoxx 600 retreated 0.2 percent, Germany’s DAX plummeted 2.1 percent following disappointing SAP results, France’s CAC 40 inched marginally higher, and the UK’s FTSE 100 advanced 0.2 percent, reflecting the sector-specific nature of earnings-driven movements and selective handset/tech stock performance variations across geographies.

The Budget presentation remains the key catalyst for Indian market direction, with potential fiscal policy shifts affecting everything from corporate tax rates to technology sector incentives including those benefiting handset manufacturers and electronics exporters.