🛒📉 Vishal Booms, SBI Dips, GDP Tanks

Author

Masala Chai
May 01, 2025

☀️ Good morning, May movers!

It’s a new month, but the markets and macroeconomy are already behaving like they skipped their morning filter coffee. From shrinking GDP in the U.S. to wild swings in smallcap stocks back home, this Thursday’s chai is less “chilled-out summer” and more “monsoon thunder.” Strap in as we decode global jitters, startup sparks, and that one trivia nugget you didn’t know you needed.

Shocked GIF

We’re in May ALREADY?????

Let’s stir the pot. 👇

☕ Chai Shots

📊 Market Masala

  • 📉 Bulls Took a Breather: Sensex dipped 46 points and Nifty barely moved, snapping a two-day winning streak as April closed out. Volatility spiked — India VIX jumped 5% — and mid & smallcaps tumbled nearly 2%.

  • 💰 FIIs Still Betting on Bharat: Despite the wobble, foreign investors have poured in over ₹37,000 crore into Indian equities in the last 10 sessions. A weaker dollar and strong domestic growth outlook are fueling that optimism.

  • 🏥 Pharma Pops, Banks Bleed: While sectors like pharma, oil & gas, and FMCG stayed afloat, Nifty Bank and PSU Bank indices slipped sharply. SBI led the decline, while stocks like HDFC Life and Maruti tried to hold the line.

  • ⚡ Ather Energy IPO Cruises to Finish Line: After some slow laps early on, Ather’s ₹3,000 crore public issue closed with a modest 1.43x oversubscription. Retail investors showed up, QIBs piled in last-minute, but grey market premiums dropped to ₹1 over issue price — raising eyebrows. Analysts are divided: some cite pricey valuations and heavyweights like TVS and Honda breathing down its neck; others point to its strong EV portfolio and premium market play.

  • 🛫 Flight Costs Soar as Airspace Shuts Down: Indian airlines are burning more than ₹77 crore each week thanks to Pakistan's airspace closure, which is forcing carriers to take circuitous detours. International routes from northern cities like Delhi to North America and Europe are now longer by up to 90 minutes, jacking up fuel bills and crew costs. Monthly impact? A wallet-squeezing ₹307 crore.

  • 🤖 Rakuten Pours ₹800 Cr+ Into India, Hiring AI Pros: Japanese tech major Rakuten is ramping up its India game with an investment of over $100 million (₹830 crore+), aiming to boost its local tech footprint and grow its workforce by 8%.

🌍 Global Masala

  • 💻 Nvidia Boss Wants Easier Export Rules: Nvidia’s CEO Jensen Huang asked the US government to relax limits on exporting AI chips, saying American tech should be allowed to grow globally. He also warned China’s catching up fast and urged stronger support for chip-making in the US.

  • 🛢️ Oil Tanks on Trade War Fears: Crude prices just had their worst month since 2021, dropping over 16% in April. Investors are spooked by weaker global demand and signs that Saudi Arabia might flood the market with more supply. Trade tensions aren’t helping either.

  • 🇪🇺 Europe Holds Steady (For Now): The Eurozone grew 0.4% in Q1 — beating expectations — but ECB members are signaling a cautious stance. Growth may slow further as U.S. tariffs ripple into European trade.

  • 🇧🇷 Brazil Misses Job Creation Target: Brazil added about 71,000 formal jobs in March—way below the 2-lakh estimate. Officials blame fewer business days due to Carnival and weaker hiring. It’s the lowest monthly gain since last December.

☕ The Big Brew: US GDP Shrinks – A Tariff Storm Brewing?

The world’s largest economy just hit a speed bump — and it might flatten more than just the U.S.

  • 📉 Q1 2025 GDP Fell 0.3%: That’s the first contraction since 2022. The culprit? A surge in imports before Trump’s new tariffs took effect, plus slower consumer and government spending.

  • 🧾 Imports Exploded Ahead of Tariffs: Businesses hoarded foreign-made goods — from cars to clothes — to dodge Trump’s 10–145% import taxes. But those imports dragged down GDP calculations, while domestic demand slowed.

  • 📉 Markets Took It Hard: Wall Street reacted with a selloff. The Dow lost over 600 points before recovering slightly. Big names like Nvidia and First Solar dropped sharply as uncertainty about investment and demand grew.

  • 🧨 Recession Warnings Grow Louder: Many economists say this could be a preview of worse quarters ahead. Once the front-loaded imports and spending fade, a real slowdown might hit. Some even predict a technical recession by Q2.

  • 🌍 Why India Should Care:

    • 🇮🇳 Indian exporters to the U.S. could see demand wobble.

    • 📦 A global trade slowdown could spill over to Indian manufacturing and IT.

    • 📈 At the same time, foreign capital may still flow into India as a "stable growth story" amid U.S. turmoil.

  • 🏦 Fed Holds the Line (For Now): Inflation cooled slightly, but with tariffs looming large, the U.S. central bank is unlikely to cut interest rates just yet. Rising costs from tariffs could keep inflation stubborn.

📌 Bottom Line: This isn't just an American headache — it’s a global sneeze. And when the U.S. economy catches a cold, India and others better bundle up.

🚀 Startup Scoop

🤓 Chai Break Trivia

☕️ Did you know that India is on track to be Costa Coffee’s top-5 market globally, inspite of us being a Chaiiiiii loving nation?
The UK-born café chain plans to open 40–50 stores a year here — proof that desis can’t resist a fancy cup of joe and a WiFi recharge spot.

🔮 What’s Brewing Next?

  • 🗓️ US Jobs Report Due Friday – Watch this one closely. If hiring slows, it could reinforce recession fears.

  • 💼 SBI Fundraising Update Expected – May 3 is when the state-run bank may unveil its next big capital-raising move.

🍵 That’s a wrap, folks!

If this week’s market drama taught us anything, it’s this: tariffs may start as policy — but they hit like plot twists. Whether you're a budget shopper, a startup founder, or just sipping chai in peace, the world economy is stirring your cup too.

Working Days Of The Week GIF by Sealed With A GIF

Catch you tomorrow with more masala. Until then, may your stocks stay green and your caffeine strong.

— Masala Chai ☕

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