FinScann Market Morning Call: Nvidia's AI Triumph Fuels India's IT Hopes Amid Geopolitical Shifts (February 26, 2026)

The Indian equity markets navigated a turbulent Wednesday, February 25, 2026, shaking off the previous day's tech sector jitters to close marginally higher, driven by a crucial sectoral rotation. As the trading day ended, global attention pivoted to Nvidia's post-market earnings report, which delivered an overwhelming beat, setting the stage for a significant "relief rally" across Indian IT giants today, February 26, 2026. This powerful earnings report, coupled with ongoing geopolitical developments and shifting trade dynamics, creates a complex but potentially bullish outlook for investors.

The Catalyst

The financial world woke up to a resounding triumph from Nvidia, which, post-market on February 25, delivered a performance that reaffirmed its dominance in the artificial intelligence (AI) era. The chip behemoth reported a staggering revenue of $68.1 billion, marking a 73% year-over-year (YoY) increase and decisively crushing market expectations. Earnings per share (EPS) stood at $1.62, surpassing the estimated $1.50. Furthermore, Nvidia's forward guidance projected revenue of $78 billion for the next quarter, signaling continued robust demand. CEO Jensen Huang encapsulated the sentiment, stating, "The world has awakened to the agentic AI era." The immediate market reaction saw Nvidia's stock surge over 4% in after-hours trading, crossing the psychological $200 barrier. This powerful performance is widely anticipated to trigger a massive bullish "relief rally" across Indian IT giants like TCS, Infosys, and HCL Tech when markets open in India today.

Adding a layer of complexity, the US Department of Commerce has imposed a 126% preliminary duty on Indian solar imports, specifically targeting companies like Adani Group and Waaree Energies. This move, following a complaint about unfairly subsidized Indian exports, introduces a significant headwind for India's green energy sector, despite the final ruling being due in July.

Financial Forensics

India's primary indices ended Wednesday, February 25, 2026, on a cautious yet positive note. The BSE Sensex closed at 82,276.07, registering a marginal gain of 50.15 points or 0.06%, while the NSE Nifty 50 advanced by 57.85 points or 0.23%, settling at 25,482.50. This came after a volatile session where benchmarks pared most of their early gains due to profit-taking at higher levels.

The day witnessed a notable sectoral flip. The Nifty Metal Index emerged as a top performer, surging 2.7%, alongside robust gains in the Auto and IT sectors. Conversely, the Nifty PSU Bank Index faced headwinds, closing down 0.4%. Heavyweight counters such as Reliance Industries and State Bank of India (SBI) acted as anchors, experiencing selling pressure that limited broader market upside.

Foreign Institutional Investors (FIIs) remained net sellers, offloading equities worth approximately ₹102 crore on Tuesday, while Domestic Institutional Investors (DIIs) provided crucial support by buying stocks worth roughly ₹3,161 crore, helping to stabilize prices. The Indian Rupee showed resilience, appreciating 6 paise to ₹90.89 per US dollar, a firmer currency that helped limit imported inflation. India VIX, a measure of market volatility, fell 4.66% to 13.49, signalling a decline in short-term volatility.

Market Impact

Nvidia's stellar earnings are a powerful reaffirmation of the global AI boom, poised to deliver a significant boost to Indian IT stocks. Companies like TCS, Infosys, and HCL Tech are expected to lead the morning charge on February 26, potentially alleviating the "AI scare" that had previously impacted the sector. This could mark a tactical rebound, attracting value-buying after recent corrections.

The US preliminary duty of 126% on Indian solar imports, specifically mentioning Adani Group and Waaree Energies, presents a tangible challenge for the Indian renewable energy sector. This could lead to increased costs for Indian exporters and may necessitate strategic re-evaluation for companies heavily reliant on the US market. Shares of Indian solar and renewable energy companies, including Waaree Energies and Premier Energies, experienced significant drops following the announcement.

Geopolitically, Prime Minister Modi's address to the Israeli Knesset on February 25, emphasizing a "Multifaceted Strategic Partnership," underscores a growing focus on defense cooperation. Discussions pivoting towards integrating Israel’s Iron Dome technology into India’s upcoming "Sudarshan Chakra" air defense shield could provide tailwinds for Indian defense stocks.

The unveiling of the Samsung Galaxy S26 series in San Francisco, featuring "Intuitive AI," is being heralded as a significant moment for on-device AI. This innovation is expected to fuel positive sentiment for Indian electronic manufacturers and semiconductor-linked stocks, indicating a broader tech trend beyond just data centers. Furthermore, Tehran's signal for diplomacy ahead of the Geneva talks on February 26 has offered some breathing room, tempering the rise in Brent Crude prices and providing much-needed stability for the Rupee.

Key Takeaways

• Nvidia's robust earnings are a major positive catalyst for the global tech sector and, by extension, for Indian IT services companies, which could see a significant gap-up opening today.
• The US solar tariffs on Indian imports, particularly impacting Adani Group and Waaree Energies, introduce near-term uncertainty and cost pressures for the domestic renewable energy sector.
• India-Israel defense collaborations, including advanced air defense systems, are likely to boost investor interest in defense-related stocks.
• Samsung's new AI-powered Galaxy S26 series could invigorate the broader electronics and semiconductor manufacturing ecosystem in India.
• Monthly expiry (February 26) often brings heightened volatility, and investors should brace for potential "U-turns" despite a strong opening.

FinScann Verdict

Today's market is poised for an exhilarating "Gap-Up" start, propelled by Nvidia's stellar performance. While the initial momentum will be strong, especially in IT and semiconductor-linked stocks, investors must remain vigilant due to the monthly expiry. FinScann advises a cautious approach during the latter half of the trading session, as "Call Writers" at key resistance levels may trigger profit-booking.

Q: What were the key Indian market numbers on February 25, 2026? A: On February 25, 2026, the Sensex closed at 82,276.07 (up 50.15 points or 0.06%), and the Nifty 50 ended at 25,482.50 (up 57.85 points or 0.23%).

Q: How did Nvidia's earnings impact the market? A: Nvidia reported revenue of $68.1 billion and EPS of $1.62, exceeding expectations and projecting $78 billion for the next quarter. This strong performance caused its stock to surge over 4% after-hours and is expected to trigger a significant bullish rally in Indian IT stocks on February 26, 2026.

Q: What is the "Solar Shock" and which companies are affected? A: The "Solar Shock" refers to the US Department of Commerce imposing a 126% preliminary duty on Indian solar imports. This primarily affects Indian companies like Adani Group and Waaree Energies, potentially increasing their export costs to the US.

Q: What are the expected key levels for Nifty 50 and Bank Nifty for February 26, 2026? A: For Nifty 50, resistance is anticipated between 25,850 – 25,920 and support at 25,450 – 25,380. For Bank Nifty, resistance levels are 61,500 – 61,700, with support at 60,800. GIFT Nifty futures suggest an opening above 25,650.

Q: Why is February 26 a crucial day for the Indian market? A: February 26, 2026, marks the monthly expiry for futures and options contracts, which historically leads to increased volatility and potential sharp reversals or "U-turns" in the market, especially during the final hour.

Disclaimer: For information only; not investment advice. Stock market investments carry risks. Please consult a SEBI-registered advisor before investing. FinScann assumes no liability for decisions made based on this report.