Weekly Market Update: The AI Dip and Why India is Volatile?

Detailed Report

Last Week's Rollercoaster (August 25-29, 2025)

The U.S. Stock Market: The AI Test and Trade Tensions

• The **S&P 500** and **Nasdaq** had a classic late-summer wobble. The S&P 500 hit a new record high of 6,501 mid-week but closed the week down 0.64%. The Nasdaq closed the week down 0.6% after retreating from its own records.
• **AI and Semiconductors:** **Nvidia's** earnings report, while strong, was met with a 3.3% stock drop as investors booked profits. Other major players like **AMD** and **Broadcom** also slipped.
• **Sector Rotation:** Traders shifted from massive AI leaders to undervalued AI plays like **Pure Storage** (+32%) and **Snowflake** (+20%) after their strong earnings.
• **Geopolitics:** Revised Q2 GDP came in at a strong 3.3%, but new tariff threats impacted supply chains for companies like **Apple**, adding a layer of uncertainty.

Middle East Markets: Global Concerns and Regional Resilience

• The **ADX General Index** in the UAE fell 0.24% and the **Dubai's DFM** also eased lower, mirroring global declines. **Saudi Arabia's Tadawul** dropped 0.70%.
• **Regional Shifts:** Despite the overall downturn, a rotation was seen in the UAE market from real estate and banking to "laggards" like **ADNOC L&S** and **Dubai Taxi**.
• **Positive Signs:** **ADNOC** raised $317M via a secondary sale, and markets noted a growing focus on non-oil growth and sustainable finance in the region.

Indian Stock Market: Tariffs Take Their Toll

• The **BSE Sensex** and **NSE Nifty 50** both extended their losses, each dropping about 1.8% for the week due to US tariff worries.
• **Sectoral Performance:** Mid and small-cap stocks were hit the hardest, falling over 3%. However, sectors like **FMCG** showed resilience.
• **SEBI Change:** Traders are adjusting to a significant change with **SEBI** reshuffling expiry days to NSE on Tuesday and BSE on Thursday.

Cryptocurrency: Bitcoin's Big Dip and Ethereum's Surge

• The global crypto market cap decreased 2.8%. **Bitcoin** fell sharply, trading around $113,000 amid a correction and ETF outflows.
• **Ethereum** surged 15% to a new all-time high of $4,885 before pulling back. This was driven by strong ETF inflows and continued buzz.
• **Market Insights:** Social media highlighted Bitcoin's unusually low volatility and large-scale whale activity, while new ETF inflows and EU digital euro potential added long-term confidence.

What to Expect This Week (September 1-5, 2025)

• **U.S. Markets:** All eyes are on key economic data, including the **PCE price index**, which could reignite hopes for a rate cut and push the markets higher.
• **Middle East Markets:** Gulf bourses may advance if oil prices stabilize and global rate cuts materialize, driven by strong regional growth forecasts.
• **Indian Stock Market:** Cautious optimism with potential for the **Nifty 50** to test the 25,000 level if positive domestic and global cues align.
• **Cryptocurrency:** A potential rally for **Bitcoin** towards $130K-$200K, and **Ethereum** eyeing $5.5K-$10K as the bull market persists.