📉 Losing streak

Good morning! Welcome to the 74 new subscribers who have joined us since last week - hope you enjoy our content and stick around 💗 

- Ruchirr Sharma & Shatakshi Sharmaa  

TABLE OF CONTENTS

• 📉 Losing streak

• 🤖 DeepSeek’s AI models boast theoretical 545% margin

• 🗞️ Bite-sized summaries

  • 📱 Standalone Reels

  • 🇺🇦 Heated debates

  • 🧑‍💻 Automated jobs

• 🧑‍🍳 What else is cookin’?

• 🍿 Entertainment, Entertainment, Entertainment

MARKETS

🇮🇳 India

• Last Friday, Indian stock markets experienced a significant downturn. This decline was driven by weak global cues, ongoing FII selling, and concerns over US tariffs. The IT sector was particularly hard-hit, with major companies like Wipro and Tech Mahindra among the top losers.

🌍️ International

• Despite geopolitical tensions, traders looked past a contentious White House meeting between President Trump and Ukraine's President Zelensky, and US stocks rallied. This rally came after a volatile month and was primarily driven by easing inflation figures, which provided some comfort to investors.

INDIAN MARKETS

📉 Losing streak

The Indian stock market has been on a relentless downward spiral, with the Nifty index registering losses for eight consecutive sessions—the longest losing streak in two years. In its latest session, the index plummeted to an eight-month low, sparking concerns among investors about a deeper correction. The Sensex and Nifty lost 2.8% and 2.9% over the past week, primarily due to weak sentiment and fresh tariff threats from US President Donald Trump.

What’s going on:

• Aditya Agarwala, Founder of Invest4edu, noted that the Nifty’s breach of its crucial 22,500 support level signals further downside risk.

• He projected a potential dip to 21,600-21,700 as the next major support levels. However, he also suggested that despite short-term weakness, the index could see an upside of 2,000 to 3,000 points over the next one to two years.

• Sudeep Shah, Deputy Vice President at SBI Securities, highlighted that Nifty has been trading below its 50-week EMA for three straight weeks, reinforcing bearish sentiment.

• He identified 22,000-21,900 as crucial support zones, while the 22,650-22,700 range now acts as a significant resistance level.

Is this an overcorrection, or something more?

• According to Dhupesh Dhameja, Derivatives Analyst at SAMCO Securities, Nifty has recorded its fifth consecutive monthly loss, with each minor rebound facing aggressive selling pressure.

• He warned that the 22,000 level is the last stronghold for bulls, and if breached, we could see further downside.

• Nagaraj Shetti, Senior Technical Research Analyst at HDFC Securities, pointed to the formation of bearish runaway gaps, indicating the market might have more room to fall. He believes that Nifty’s next downside targets are around 21,800-21,700, with immediate resistance at 22,300.

So what’s next? Given the bearish momentum, traders should exercise caution and look for clear reversal patterns before making any aggressive bets. The 22,000-21,900 range remains a critical support zone to monitor. Any sustained recovery will likely face resistance at 22,700.

Long-term investors, however, might see this correction as a buying opportunity. Historically, such market downturns have provided solid entry points for high-quality stocks. For those looking to deepen their understanding of technical analysis and market trends, here are some useful resources:

• Nifty 1,100 Points Away from Official Bear Market Zone

• Introduction to Technical Analysis & Candlestick Theory

• Market Insights from IndiaCharts

With global uncertainties, technical weaknesses, and sentiment-driven volatility, the road ahead remains unpredictable. Staying informed and adopting a cautious approach will be key in navigating these market conditions. But as always - please do your own research!

Read more: Economic Times

ARTIFICIAL INTELLIGENCE

🤖 DeepSeek’s AI models boast theoretical 545% margin

Chinese AI startup DeepSeek has sent shockwaves through the tech industry by revealing that its AI models achieved a theoretical profit margin of 545% during a 24-hour period at the end of February.

The announcement, made via X (formerly Twitter), provides rare insight into the financial workings of AI companies, which typically keep such details under wraps.

However, a closer look reveals significant caveats that temper the excitement surrounding these figures.

Breaking Down the Numbers:

DeepSeek’s reported margin comes from comparing the cost of inferencing—resources like computing power, electricity, and data storage—to the revenue generated from AI services during that specific timeframe. The startup emphasized that these margins are theoretical, as its actual revenues are much lower due to factors such as:

• Limited monetization across its offerings

• Discounts during off-peak hours

• Exclusion of R&D and training costs from its cost calculations

Despite these disclaimers, the reveal comes at a critical moment when investors are scrutinizing the financial viability of AI startups.

DeepSeek’s Disruptive Approach Founded just 20 months ago, DeepSeek has gained attention for its open-source AI philosophy, setting it apart from U.S.-based competitors like OpenAI and Anthropic, which prioritize proprietary models. The startup claims to have optimized its computing infrastructure by:

• Balancing server loads to maximize efficiency

• Reducing latency (the delay between a query and its response)

• Processing large amounts of data at scale

These innovations contribute to its cost-efficiency and make its AI models more accessible.

The Bigger Picture: AI’s Profitability Puzzle The AI industry is still in a race to establish sustainable business models. Companies such as OpenAI, Anthropic, and Google DeepMind have experimented with various revenue streams, including:

• Subscription-based services (e.g., ChatGPT Plus)

• Usage-based pricing

• Enterprise licensing

However, profitability remains elusive. AI development is capital-intensive, requiring vast resources for model training and infrastructure maintenance. Investors are increasingly questioning whether high-margin claims like DeepSeek’s can translate into long-term financial success.

What’s next for DeepSeek? DeepSeek’s decision to share operational details and key performance insights marks a bold departure from industry norms.

While its theoretical margin is impressive, real profitability hinges on sustainable revenue growth, customer adoption, and ongoing innovation.

If DeepSeek can prove its efficiency at scale, it may set a new benchmark for AI cost-effectiveness.

Read more: Economic Times

GENERAL OVERVIEW

🗞️ Bite-sized summaries

📱 Standalone Reels - Instagram is reportedly considering launching a standalone Reels app to compete with TikTok, according to sources cited by The Information. The initiative, part of Meta’s “Project Ray,” aims to enhance content recommendations and promote longer Reels videos. With TikTok facing potential bans in the U.S., Meta sees an opportunity to attract short-form video creators. However, it’s unclear if Reels would remain integrated into Instagram. This wouldn’t be Meta’s first attempt—its previous TikTok competitor, Lasso, failed in 2020. The move follows Instagram’s recent launch of Edits, a CapCut alternative, to lure TikTok creators.

🇺🇦 Heated debates - A meeting between President Donald Trump, Vice President JD Vance, and Ukrainian President Volodymyr Zelenskyy in the Oval Office erupted into a heated argument over Ukraine’s war with Russia. Trump accused Zelenskyy of being unwilling to negotiate peace while the U.S. was involved, warning him he was “gambling with World War III.” The dispute overshadowed a planned critical minerals deal between the nations, leading to the cancellation of a press conference. Zelenskyy later thanked the U.S. for its support, while Trump, prioritizing financial returns on aid to Ukraine, questioned Kyiv’s stance on peace and diplomacy.

🧑‍💻 Automated jobs - InMobi CEO Naveen Tewari warned that 80% of software coding at his company will be automated by year-end, leading to job losses for engineers. He urged professionals to upgrade their skills, as AI will first disrupt specialized jobs. Tewari also stated that AI-driven models could replace investors, except those skilled in human psychology. InMobi, which operates InMobi Ads and Glance, is adopting an AI-first strategy. The company recently partnered with Google Cloud for GenAI solutions and secured $100 million in funding. Tewari emphasized that only GenAI-led companies will survive in an increasingly competitive market.

HEADLINES

🧑‍🍳 What else is cookin’?

What’s happening in India (and around the world 🌍️)

• Skype shutdown: Microsoft's billion-dollar bet fails to keep pace.

• Trump signs order designating English as the official language of the US.

• Trump says he will offer ‘gold cards’ for $5 million path to citizenship, replacing investor visas.

• Vaccine targeting pancreatic cancer shows promise in new study of clinical trial.

• Amazon introduces a quantum computing chip for AWS customers, keeping pace with competitors like Google and Microsoft.

CULTURE

🍿 Entertainment, Entertainment, Entertainment

• Cricket - Champions Trophy: Shreyas Iyer, Varun Chakravarthy shine as India beat New Zealand to set up semifinal with Australia.

• Badminton - Indian mixed doubles pair Dhruv Kapila and Tanisha Crasto crash out of German Open.

• Kannappa: Vishnu Manchu is fearless in second teaser, Prabhas steals the show.

• Dabba Cartel review: Shabana Azmi's performance is half the battle won.