Investors have bailed on Palantir Technologies Inc (NASDAQ: PLTR) in recent days following reports that the Trump administration is considering trimming the US defense budget.

But the country’s political figures have been doing the polar opposite – at least four of them have recently disclosed stakes in the big data analytics firm, signalling confidence in its long-term prospects.

PLTR shares have lost a total of more than 30% since February 19^th.

US Congressmen who have bought Palantir stock

Rep. Majorie Taylor Greene has recently loaded up on shares of Palantir Technologies.

In total, the Congresswoman spent up to $15,000 to buy PLTR shares on February 12. Rep. Taylor has invested in Nvidia stock this month as well.

A day earlier, on February 11, congressional representatives Gilbert Ray Cisneros Jr. and James Comer also disclosed a stake worth up to $15,000 each in Palantir stock.

Finally, recently elected representative of Texas’s 32nd congressional district, Julie Johnson, has parked as much as $15,000 in Palantir stock as well.

Investors should note, however, that these US politicians made their moves before the plunge in Palantir stock.

So, their investment decisions couldn’t have been aimed at capitalising on the recent weakness in PLTR. 

Why may DoD budget cuts be significant for PLTR?

If the new US government does indeed proceed with lowering its defense spending, it could prove to be a significant headwind for Palantir.

Why? Because the Denver headquartered firm generates more than 40% of its revenue from government contracts.

So, cutting costs on that front could weigh on a significant source of PLTR’s revenue.  

Still, Dan Ives – a senior Wedbush Securities analyst remains bullish on Palantir stock as the DoD budget cuts could actually prove to be a tailwind for it.

“Palantir’s unique software approach will enable the company to gain more IT budget dollars at the Pentagon … not less, despite these initial knee-jerk reactions from the Street,” he told clients in a research note last week.

Despite today’s decline, Palantir shares are up a dozen-fold versus their all-time low.

Palantir Q4 earnings snapshot

Before the Pentagon news, Palantir shares were trading at record levels, partially related to the company’s solid earnings release on February 3.

PLTR earned 14 cents a share on $828 million in revenue in the quarter ended December. Analysts, in comparison, were at 11 cents per share and $776 million, respectively. At the time, the company’s chief executive Alex Karp told investors:

“Our business results continue to astound, demonstrating our deepening position at the centre of the AI revolution.”

Palantir stock may be worth owning at current levels as its management issued strong guidance for the full year in early February. The defense stock does not currently pay a dividend, though. 

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Tesla is once again in the spotlight as it inches closer to entering the Indian market, after two previously unsuccessful attempts.

The latest reports suggest that the EV giant has begun producing vehicles at its Berlin facility for import into India, while also actively scouting potential factory locations.

These developments follow Tesla CEO Elon Musk’s recent meeting with Indian Prime Minister Narendra Modi.

However, neither Musk nor the company has officially confirmed these plans.

According to a report by CNBC-TV18, Tesla intends to start selling imported vehicles from its Berlin plant in India as early as April.

The company is expected to introduce a budget-friendly EV priced at approximately $25,000 (around Rs 21 lakh).

Adding weight to these claims, a Reuters report suggests that Tesla is finalizing locations for two showrooms in India and has posted 13 job openings across sales and service roles in Mumbai and Delhi.

Reduced EV import duty could make Tesla cars more affordable for Indians

Tesla’s past attempts to enter India were hindered by the country’s high import duties, which range between 70% and 100% on completely built units (CBUs).

These steep tariffs would make Tesla’s vehicles prohibitively expensive for most Indian consumers.

However, India’s new EV policy, announced in March 2024, has the potential to ease Tesla’s entry.

The policy allows automakers that invest at least $500 million in local manufacturing to import 8,000 EVs annually at a reduced 15% import duty.

If Tesla qualifies under this policy, its vehicles could become significantly more affordable for Indian buyers.

India’s EV market: opportunities and challenges for Tesla

India’s electric vehicle market is set for rapid expansion.

According to Frost & Sullivan, the sector is expected to grow at a compound annual growth rate (CAGR) of 34.5% between 2023 and 2030.

A report by the India Energy Storage Alliance states that India’s cumulative EV sales surpassed 4.1 million units in FY 2023-24, with projections exceeding 28 million EVs by 2030.

Despite this promising growth, Tesla faces a tough competitive landscape.

Domestic automakers such as Tata Motors and Mahindra have already established themselves in the EV sector by offering cost-effective models that align with local consumer preferences.

Furthermore, Tesla’s direct-sales model and limited service network could pose challenges unless the company introduces a clear roadmap for aftersales service and charging infrastructure.

Will Tesla eat into the market share of Tata Motors, M&M?

Industry experts and analysts remain divided on whether Tesla’s entry will significantly disrupt India’s automotive market.

Some believe the company’s presence will drive competition, forcing domestic players to refine their pricing strategies and enhance innovation.

Others argue that Tesla’s impact will be minimal without a strong local manufacturing base.

Sathyanarayana Kabirdas, Vice President at Frost & Sullivan, believes Tesla’s ability to leverage reduced import duties could push other luxury automakers to reconsider their pricing models.

He also suggests that Tesla’s arrival may prompt the Indian government to introduce further policy adjustments to support local manufacturers.

On the other hand, India’s G20 Sherpa and former Niti Aayog CEO Amitabh Kant recently downplayed Tesla’s potential dominance in India.

“Tatas and Mahindras will not allow Tesla to succeed. Their prices are very competitive,” he stated.

Source: Finshots

Market analyst Ambareesh Baliga echoed this sentiment, suggesting that Tesla’s entry would have more of a sentimental impact on listed EV players rather than a structural shift in the industry.

“Tesla’s price range will be higher than that of the target customers of Tata Motors India EV, MSIL, and M&M, and hence, I don’t see any shift here. M&M may see a first-mover advantage in the mid-segment EVs, with the BE 6e and XEV 9e (priced between ₹20 lakh and ₹35 lakh) seeing record bookings,” he added.

Overall, I see Tesla’s entry expanding the EV market in India, but it may not eat into the market segment of existing listed EV players.

CLSA said that Tesla must establish local manufacturing to achieve price competitiveness, as even a reduced import duty may not be sufficient to bring prices below Rs 35-40 lakh.

Sanjeev Hota, head of research at Mirae Asset Sharekhan concurred, adding that Tesla’s entry into India has been discussed for years and is largely factored into stock prices.

Key EV component makers may benefit

Leading brokerages CLSA and Nomura believe Tesla’s entry will not significantly impact domestic market leaders like Maruti Suzuki or Tata Motors.

However, they see potential benefits for key suppliers such as Sona Comstar, Sansera Engineering, and Motherson Sumi.

Shares of seven listed Indian companies supplying parts to Tesla surged last week, as the EV giant’s India plans became clearer.

Sandhar Technologies rose 5%, SKF India gained 2.5%, Sundaram Fasteners climbed 2.2%, Varroc Engineering added 2%, Suprajit Engineering and Sona BLW were up 1% each, while Bharat Forge dipped 0.17%.

Here’s how four key suppliers are performing in the stock market:

Suprajit Engineering: The company has been supplying components to Tesla since 2022.

However, its share price has fallen 18% year-to-date, trading at Rs 390.

Sona BLW Precision Forgings: Known for its precision-forged components, Sona BLW could emerge as a major supplier to Tesla.

Its stock is down 15% YTD, currently at Rs 503.25.

Sundram Fasteners: This firm has been supplying Tesla since 2017 and secured a $250 million EV component contract in 2023.

Its share price has declined over 8.5% YTD.

Varroc Engineering: A supplier of lighting systems for Tesla’s Model S and Model X, Varroc’s stock has fallen 12.6% in the past year.

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Vietnam’s booming trade relationship with the US is under increasing threat as former US President Donald Trump signals sweeping tariffs that could impact nearly all of the country’s exports to its largest market.

Vietnam shipped more than $142 billion worth of goods to the US in 2024, making up approximately 30% of its GDP, according to UN data.

This comes as Trump’s trade policies take a sharply protectionist turn, raising concerns among Vietnamese officials and foreign companies about potential economic disruption.

Vietnam had been a major beneficiary of the US-China trade war during Trump’s first term, attracting manufacturers looking to sidestep tariffs on Chinese goods. Its high trade surplus with the US has made it a target for reciprocal tariffs.

Vietnam now faces an urgent need to recalibrate its trade strategy to protect its economy from potential sanctions, as US trade officials scrutinise the country’s tax policies, energy partnerships, and role in global supply chains.

Vietnam’s trade policies under scrutiny

Vietnam’s trade policies, including import duties and non-tariff barriers, are now in focus as the US weighs retaliatory tariffs.

Vietnam applies higher average levies on imports compared to US duties, and its value-added tax system further raises costs for foreign goods. Some economists argue that Vietnam’s effective bilateral tariff rates remain lower than those of the US.

A major concern is how Washington will determine the new tariff rates. The US Trade Representative’s 2024 report outlined a long list of non-trade barriers Vietnam imposes, including strict registration requirements and import bans.

These barriers are now under review as part of broader US scrutiny, with potential implications for Vietnam’s export-dependent economy.

Vietnamese officials have shown willingness to negotiate and even consider lowering tariffs on US goods, but this could trigger a wider trade policy shift requiring reductions for other trading partners as well.

Such a move would complicate Vietnam’s broader trade relationships, making it a challenging balancing act for policymakers.

Energy deals as leverage

Vietnam is exploring ways to mitigate the impact of tariffs by increasing US energy imports, according to a Reuters report.

The country has held discussions with US officials about purchasing liquefied natural gas (LNG), a sector Vietnam is keen to expand as it works towards a more diversified energy mix. These talks have yet to materialise into concrete agreements.

A more ambitious move is Vietnam’s planned revival of its nuclear power programme.

The country is looking for suppliers of nuclear technology, and US firms could be potential partners.

If Vietnam commits to large-scale energy deals with the US, it could provide leverage in trade negotiations and potentially ease tariff tensions.

Agriculture and transhipment concerns

Vietnam has signalled openness to increasing imports of US agricultural products, but the scale of potential purchases is unlikely to significantly offset trade imbalances.

In 2023, Vietnam imported just $3.4 billion worth of US farm goods—only a fraction of its overall trade surplus. While increased agricultural imports might help in trade discussions, they are unlikely to be a sufficient countermeasure against sweeping tariffs.

Meanwhile, the US remains concerned about Vietnam’s role in transhipping Chinese goods to bypass tariffs. Vietnam has long been suspected of serving as a transit hub for Chinese products destined for the US.

In sectors such as solar panels, Vietnamese firms have already faced penalties for facilitating Chinese exports.

Vietnam is now attempting to avoid further scrutiny by imposing temporary anti-dumping duties on Chinese steel imports.

This is a defensive move aimed at reducing the risk of the US slapping additional 25% tariffs on Vietnamese steel exports, which are already subject to anti-dumping duties.

The country’s reliance on the US market has made it particularly vulnerable to protectionist policies, forcing officials to reassess their trade and economic strategies.

While Vietnam is exploring multiple avenues—ranging from energy deals to tariff negotiations—the effectiveness of these measures remains uncertain.

As Trump pushes ahead with his aggressive trade agenda, Vietnam must move quickly to protect its export-driven economy from escalating trade tensions with its biggest customer.

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Shares of Indian IT companies plunged on Friday as investor sentiment turned cautious over concerns about a slowing US economy and rising inflation expectations, exacerbated by former US President Donald Trump’s tariff policies.

The Nifty IT index shed over 4%, with major IT players witnessing sharp losses.

Tech Mahindra led the declines, slipping nearly 6%, while Mphasis, Persistent Systems, Wipro, LTIMindtree, and Infosys fell between 4-5%.

Heavyweights Tata Consultancy Services (TCS), HCL Technologies, and Coforge were also down by 3-4%.

US jobless claims add to economic uncertainty

The sell-off was triggered by fresh data from the US Labor Department, which showed an unexpected spike in initial jobless claims.

For the week ended February 22, claims rose by 22,000 to a seasonally adjusted 242,000, marking the largest increase since October.

While analysts attributed the rise to snowstorms and the President’s Day holiday, concerns remain that further layoffs could emerge in the coming weeks, worsening economic conditions.

This development adds to broader concerns that the US economy is losing momentum, which could impact spending by major clients of Indian IT firms.

A weaker economic outlook in the US, the largest market for Indian IT services, raises fears of lower technology spending by businesses and financial institutions.

Analysts remain cautious on IT sector growth

While the uncertainty surrounding the US presidential election had eased following the results, analysts at Kotak Institutional Equities warned that Trump’s policy decisions continue to create volatility.

Client conversations till now do not indicate a material shift in tech spending priorities due to the perception of higher uncertainty under the Trump administration, analysts at Kotak Institutional Equities said.

However, they cautioned that downside risks remain due to slower recovery in spending and the near-term impact of artificial intelligence adoption on traditional IT services.

“The slower spending recovery and near-term risk from AI adoption lead to downside risks to revenue growth and margin estimates and stock multiples. The weak business momentum leads us to maintain a cautious view on engineering research and design (ERD) companies despite the ~18-36 per cent decline in stock prices in the past year,” the brokerage firm said in an IT services sector report.

Meanwhile, JM Financial Institutional Securities analysts flagged growing uncertainty in the sector.

“In our recent interactions with IT services players, we picked up sporadic instances of pause in transformation programs by large US banks. This, if it spreads, could put Street’s (and ours) FY26 growth estimates at risk,” the brokerage firm in a sector report.

Broader market declines amid global tech sell-off

The broader Indian market also faced significant losses.

The BSE Sensex dropped 1,000 points, or 1.34%, to 73,602, while the Nifty50 fell to 22,270. The overall market capitalisation of BSE-listed firms shrank by Rs 7.16 lakh crore to Rs 385.94 lakh crore.

Adding to the pressure, global markets followed suit, with the MSCI Asia ex-Japan index declining 1.21%, tracking losses on Wall Street.

A steep fall in Nvidia’s shares after its earnings report triggered a sell-off in AI-driven and mega-cap tech stocks, further dragging down IT stocks worldwide.

Dr. V K Vijayakumar, Chief Investment Strategist at Geojit Financial Services, said, “Stock markets dislike uncertainty, and uncertainty has been on the rise ever since Trump was elected the US president. The spate of tariff announcements by Trump has been impacting markets and the latest announcement of an additional 10% tariff on China is a confirmation of the market view that Trump will use the initial months of his presidency to threaten countries with tariffs and then negotiate for a settlement favourable to the US.”

“How China responds to the latest round of tariffs remains to be seen,” he said.

With US economic data showing signs of weakness and global markets remaining volatile, Indian IT companies may continue to face pressure in the near term.

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A significant batch of Bitcoin options contracts is set to expire on Friday, February 28, with a total notional value of approximately $4.7 billion.

This expiry event, larger than usual due to the month-end, is expected to have limited direct impact on the spot market, which is already under pressure from US President Donald Trump’s ongoing trade war.

The put/call ratio for this options expiry stands at 0.71, indicating a higher number of call (long) contracts compared to puts (shorts).

Data from Deribit shows that open interest remains highest at the $120,000 strike price, accounting for $1.5 billion in contracts.

Additionally, the $100,000 and $110,000 strike prices have around $1 billion in open interest each, while bearish sentiment is increasing, with $800 million in contracts positioned at the $80,000 strike price—Bitcoin’s current level.

Traders brace for further downside risk

According to crypto derivatives provider Greeks Live, market sentiment remains predominantly bearish.

“Overall Market Sentiment: The group is predominantly bearish with traders watching $82,000 as a critical support level that must hold to maintain the HTF (high timeframe) trend. There is significant concern about the continued downside, with many members discussing the rapid 17% decline over three days and debating whether recent selling is controlled or indicative of a broader market shift,” read the post.

BTC was trading at $78,751 at 8:44 am GMT.

Technical analysts warn that if the asset closes below the 2024 volume-weighted average price (VWAP) bands, the higher timeframe trend could be at risk, potentially pushing Bitcoin toward the $77,000–$72,000 range.

Meanwhile, Ethereum is also facing a major expiry event, with 526,000 options contracts worth $1.14 billion expiring.

The put/call ratio of 0.52 indicates relatively balanced positioning, though Ethereum has faced steeper losses than Bitcoin in recent sessions.

What will happen to BTC and ETH prices?

With Bitcoin facing heightened volatility, some traders are shifting toward call ratio spreads as a defensive strategy.

This move is based on the expectation that, following the recent downturn, Bitcoin’s price action may become choppy, with a potential retest of $88,000 before a clearer direction emerges.

Deribit reports that traders are preparing for further market turbulence, hedging against the risk of Bitcoin declining to levels last seen after election day.

The broader outlook remains weak, exacerbated by US President Donald Trump’s tariffs on Mexico, Canada, China, and Europe.

The long-term implications for Bitcoin and the cryptocurrency sector remain uncertain.

Despite the current downturn, the max pain price for both Bitcoin and Ethereum remains significantly above their spot prices.

With the max pain price exceeding the spot price, options sellers may have an incentive to push Bitcoin and Ethereum prices higher toward that level.

“With the end of the month approaching, BTC options traders should take note: Max Pain for Feb 28 sits at $98,000, with a massive $5 billion notional value. This means the highest open interest is clustered here, incentivizing market makers to keep BTC close to this price. Expect increased volatility and potential price gravitation toward this level,” altcoin options exchange PowerTrade stated.

Crypto market sell-off deepens

The ongoing sell-off in the crypto markets has intensified, with total market capitalization dropping another 8.4% on Friday to $1.6 trillion, according to CoinGecko.

The asset has now corrected more than 25% from its all-time high, dipping below $80,000 for the first time since November 10.

Ethereum, meanwhile, saw an even steeper decline, falling 8% to $2,150, marking its lowest price in over a year with weekly losses of 22%.

“Despite the dip, institutions like Standard Chartered remain optimistic, targeting $500K by the end of Trump’s term. Additionally, Texas’s unanimous approval of a Bitcoin Reserve shows strong government support for the sector. While these positive developments have boosted investor sentiment, it is yet to be reflected in Bitcoin’s price,” Saxena added.

Other major cryptocurrencies also slid, with Ethereum down 7%, XRP losing 5%, BNB dropping 4%, and Solana slipping 3.9%. Dogecoin, Cardano, Chainlink, Tron, Sui, Avalanche, Stellar, Litecoin, and Hedera recorded losses between 2% and 8%.

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