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Markets Surge on Landmark India-US Trade Pact
3 Feb
Summary
- Indian equity benchmarks surged, marking the second consecutive session of gains.
- A new trade deal between India and the US eased tariff worries and boosted sentiment.
- Key stocks like Adani Ports, Bajaj Finance, and Reliance Industries led the index gains.
Indian equity benchmarks concluded Tuesday on a strong upward trajectory, marking their second consecutive session of gains fueled by robust buying interest. The market sentiment received a significant boost from the announcement of a long-anticipated trade deal between India and the United States, effectively alleviating tariff-related concerns that had previously impacted market performance.
The S&P BSE Sensex experienced a substantial increase of 2,072.67 points, closing at 83,739.13, while the Nifty 50 index added 639.15 points to reach 25,727.55. This surge follows a cumulative gain of 3.74% for the Sensex and 3.63% for the Nifty over the past two trading sessions. Notable contributors to this rise included Adani Ports & SEZ, Bajaj Finance, and Reliance Industries.
The landmark trade agreement, announced following a call between Prime Minister Narendra Modi and U.S. President Donald Trump, aims to increase bilateral trade to $500 billion by 2030. Under the pact, Washington will reduce tariffs on Indian goods, and New Delhi has agreed to reduce tariffs and non-tariff barriers on U.S. products, including a cessation of Russian crude oil purchases. This development is expected to significantly benefit export-oriented sectors like textiles and apparel.
In broader market performance, the BSE 150 MidCap Index rose by 2.79%, and the BSE 250 SmallCap Index jumped by 2.91%. The market breadth was overwhelmingly positive, with a significantly higher number of advancing stocks compared to declining ones on the BSE. Additionally, the NSE's India VIX, an indicator of market volatility, declined by 6.99%.
