After ending FY25 on a muted note, the sentiment surrounding domestic equities could remain cautious next week. The reciprocal tariffs on autos is set to take effect in the US next week. Even thought media reports suggested that the current U.S. administration could take a more lenient approach when applying reciprocal
tariffs, perhaps allowing for negotiations, the final outcome, however, remains uncertain.
Given the fact that the US GDP growth rate slowed down in the last qurter of 2024, the impact of the latest round of tariffs on the American economy and the global economy would remain in focus in the near term.
The week will also witness the release a slew of major macroeconomic data points.
On the domestic front, the HSBC Manufacturing PMI Final for India will be announced on Wednesday (02 April 2025). The HSBC India Manufacturing PMI accelerated to 57.6 in March 2025 from 56.3 in the previous month, according to preliminary estimates. The reading signaled stronger operating conditions and was broadly in line with the 2024/25 fiscal year average, driven by a quicker rise in sales and a sharp increase in new business from abroad amid the US tariff announcement.
On Friday (04 April 2025), the Services PMI and the Composite PMI figures would be made public.
The HSBC India Services PMI fell to 57.7 in March 2025 from 59.0 in the previous month, marking the 44th consecutive month of growth in services activity, preliminary estimates showed. The slowdown reflected a softer increase in services activity, though factory production rose at the fastest pace since July 2024.
The HSBC India Composite PMI edged lower to 58.6 in March 2025 from a final 58.8 in February, flash data showed. While marking the 44th month of private sector growth, this was the slowest increase since November 2024 as services activity eased, while factory output hit its highest level since July 2024. New orders stretched the current sequence of growth to over 3-1/2 years, despite its rate of rise a tick below that in February.
The value of India’s Foreign Exchange Reserves will also be released on the same day. Foreign Exchange Reserves in India increased to $658800 million in the week ended on 21 March 2025 from $654270 million in the previous week.
On the global front, the China NBS Manufacturing PMI figures would be unveiled on Monday, 31 March 2025. China's official NBS Manufacturing PMI rose to 50.2 in February 2025 from 49.1 in the prior month, pointing to the expansion in the factory activity in 3 months. The latest result came as companies resumed activities after the Lunar New Year break.
The China Caixin Manufacturing PMI would be announced on Tuesday, 01 April 2025. The Caixin China General Manufacturing PMI rose to 50.8 in February 2025 from 50.1 in the previous month. This marked the highest reading since last November, with output and new orders growing the most in three months as market conditions enhanced.
On the same day, the inflation rate for the Euro Area will be made public. The Euro Area's consumer price inflation rate eased to 2.3% in February 2025, slightly below the preliminary estimate of 2.4% and down from a six-month high of 2.5% in January. Despite the decline, inflation remains above the European Central Bank's 2% target.
Tuesday will also witness the release of ISM Manufacturing PMI and JOLTs Job Openings data in the United States (USA).
The ISM Manufacturing PMI for the USA fell to 50.3 in February 2025 from 50.9 in January. The reading pointed to a slower growth in the manufacturing sector as "demand eased, production stabilized, and destaffing continued as companies experience the first operational shock of the new administration’s tariff policy.
Job openings in the United States increased by 232,000 to 7.74 million in January 2025, up from a revised 7.51 million in December and surpassing the market expectation of 7.63 million. Notable increases occurred in retail trade (up 143,000), finance and insurance (up 77,000), and health care and social assistance (up 58,000). In contrast, job openings fell in professional and business services (down 122,000).
The ISM Services PMI for the American economy will be announced on Thursday, 03 April 2025. The ISM Services PMI unexpectedly increased to 53.5 in February 2025 from 52.8 in January. The reading pointed to a faster growth in the services sector, with business activity (54.4 as compared to 54.5), new orders (52.2 as compared to 51.3), employment (53.9 as compared to 52.3) and supplier deliveries (53.4 as compared to 53) expanding for the third month in a row, the first time it happens since May 2022.
On Friday (04 April 2025), the US non-farm payrolls data would be made public. The US economy added 151K jobs in February 2025, up from a downwardly revised 125K in January. Employment trended up in health care (52K), namely ambulatory health care services (26K); financial activities (21K); transportation and warehousing (18K); and social assistance (11K). Meanwhile, federal government employment declined by 10K, already reflecting some of the impact of the DOGE layoffs although the effects of federal spending cuts and tariffs are expected to weigh more on the labor market in the coming months.
The latest unemployment rate figure for the United States will also be released on Friday. The U.S. unemployment rate rose to 4.1% in February 2025, up from 4.0% in January and slightly exceeding market expectations of 4.0%. The number of unemployed individuals increased by 203,000 to 7.05 million, while employment declined by 588,000 to 163.31 million. The labor force participation rate also fell to 62.4%, and the employment-population ratio decreased to 59.9%.