Domestic equity markets opened with a historic rally on Tuesday, a day after India and the United States agreed to a trade deal, with benchmark indices posting sharp gains in early trade.
The BSE Sensex surged 3,656.74 points, or 4.48 per cent, to open at 85,323.20, while the Nifty 50 began the session at 26,308.05, up 1,219.65 points, or 4.86 per cent.
The momentum strengthened through the session. The Sensex later zoomed 4,205.27 points, or 5.14 per cent, to 85,871.73, while the Nifty advanced 1,252.8 points, or 4.99 per cent, to 26,341.20, bringing it close to its all-time high.
The surge followed the announcement of an India–US trade agreement under which Washington will reduce reciprocal tariffs on Indian goods to 18 per cent from the existing 25 per cent. US President Donald Trump revealed the development after a phone conversation with Prime Minister Narendra Modi.
Among Sensex constituents, Adani Ports, Bajaj Finance, Eternal, Bajaj Finserv, InterGlobe Aviation, and Reliance Industries traded sharply higher, gaining between 3.7 per cent and 7.2 per cent.
In the broader market on the NSE, the Nifty 100 rose nearly 4 per cent, the Nifty Smallcap index climbed 4.6 per cent, and the Nifty Midcap index gained 4.05 per cent.
V.K. Vijayakumar, Chief Investment Strategist at Geojit Investments, described the “dramatic announcement” of the long-awaited trade deal and the US tariff cut as a potential game changer for both the Indian economy and equity markets.
“The impact of the deal will be manifold: first, India’s growth rate could rise to around 7.5 per cent in FY27, supported by higher exports to the US. Second, corporate earnings, already showing signs of revival, may accelerate to 16–18 per cent. Third, the rupee is likely to strengthen sharply,” he said.