Synopsis : Indian equity markets witnessed one of their strongest single-day rallies as the India–US trade agreement lifted investor sentiment and eased long-standing tariff worries. Heavyweight stocks, strong rupee movement, and aggressive FII short covering powered the Sensex and Nifty sharply higher.
Indian stock markets staged a breathtaking rally on Tuesday, with benchmark indices Sensex and Nifty50 posting one of their biggest single-day gains in recent years, buoyed by euphoria surrounding a long-awaited India–US trade deal. The agreement significantly reduced tariff uncertainty that had weighed on Indian equities for months, triggering a powerful risk-on move across sectors.
The Sensex skyrocketed over 2,250 points, while the Nifty50 surged above the 25,750 mark, as both indices climbed between 4.4% and 4.7% intraday. The sharp upside move marked a decisive turnaround in sentiment after weeks of cautious positioning by global and domestic investors.
The rally followed U.S. President Donald Trump’s announcement of a bilateral trade pact with India. Under the deal, U.S. tariffs on Indian goods have been cut to 18% from 50%, while India agreed to halt Russian oil purchases and ease several trade barriers. Market participants viewed the agreement as a major geopolitical and economic positive for India.
According to Citi Research, concerns around India’s potential geopolitical isolation have eased substantially following back-to-back trade agreements with both the European Union and the United States. Analysts believe the U.S. deal, in particular, could help stem foreign capital outflows and restore confidence among global investors.
Multiple factors fueled the market’s sharp rise. A stronger rupee supported sentiment, while foreign institutional investors (FIIs) were seen aggressively covering short positions. Heavyweight stocks across banking, IT, metals, and energy led the charge, contributing significantly to index gains. Positive global cues further amplified the momentum, with Asian markets trading firmly higher.
Global markets echoed the optimism. S&P 500 futures edged higher, while Japan’s Topix, Australia’s ASX 200, and Hong Kong’s Hang Seng all posted solid gains, reinforcing the risk-on mood.
With tariff-related uncertainty easing and foreign investor confidence improving, analysts expect near-term market momentum to remain strong, though they caution that volatility could persist as investors reassess valuations after the sharp rally.
Disclaimer : This article is for informational purposes only and does not constitute financial or investment advice. Market movements are subject to risk and change. Readers should consult a qualified financial advisor before making investment decisions.
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