India-US Trade Deal Stocks Rally: Sensex & Nifty Gain Early

With new foreign fund inflows and optimistic sentiment following the India-US trade deal, benchmark indices Sensex and Nifty were rising in early trading on Wednesday, building on the previous day’s dramatic rally.

Early Market Performance & Key Movers

However, a steep drop in IT stocks limited the market’s upswing. Early trading saw the 30-share BSE Sensex rise 68.49 points to 83,816.96. At 25,779.45, the 50-share NSE Nifty increased by 51.90 points.

Among the largest winners among the Sensex companies were Mahindra & Mahindra, Power Grid, Reliance Industries, NTPC, ICICI Bank, and ITC.

IT Sector Lags Behind

The largest laggards, with declines of up to 5%, were Infosys, Tata Consultancy Services, HCL Tech, and Tech Mahindra. In early trading, the BSE IT index fell 4.95 percent to 35,311.34.

According to exchange data, foreign institutional investors turned into buyers on Tuesday, purchasing stocks valued at Rs 5,236.28 crore. The stocks purchased by domestic institutional investors (DIIs) totaled Rs 1,014.24 crore.

India-US Trade Deal Impact

A framework for a trade agreement between the US and India calls for Washington to reduce tariffs on Indian imports from the current 50% to 18%. The announcement is significant because, starting of August 27, 2025, the United States has imposed a high tariff on Indian goods entering American markets.

Asian Market Overview

South Korea’s Kospi saw increased trading in Asian markets. Shanghai’s SSE Composite index, Hong Kong’s Hang Seng index, and Japan’s Nikkei 225 index all saw declines in quotations. “The rise fueled by the US-India trade accord would encounter obstacles to sustain.”

Chief Investment Strategist VK Vijayakumar of Geojit Investments Limited claims that “the IT selloff in the US yesterday may drag the Indian IT index too, restricting the rebound in the Indian market.”

Global Oil Benchmark

Brent crude, the global oil benchmark, climbed 0.68 per cent to USD 67.77 per barrel. The Sensex closed Tuesday at 83,739.13, up 2,072.67 points, or 2.54 percent. The Nifty shot up 639.15 points, or 2.55 percent, to close at 25,727.55.

Frequently Asked Questions

1. What caused the early trading increase in the Indian stock market?

Following the announcement of the India-US trade agreement, which promises lower tariffs on Indian goods entering the US, the market rose as a result of new foreign fund inflows and optimistic sentiment.

2. Which stocks led the gains on the Sensex?

Among the companies that benefited most from early trade were Mahindra & Mahindra, Power Grid, Reliance Industries, NTPC, ICICI Bank, and ITC.

3. Despite the market rally, why did IT stocks decline?

The global IT selloff that affected investor sentiment was the main cause of the 5% declines in major IT companies like Infosys, TCS, HCL Tech, and Tech Mahindra. The BSE IT index fell 4.95% as a result.

4. How much did both domestic and foreign investors put in?

The market gained pace as domestic institutional investors (DIIs) bought stocks worth ₹1,014.24 crore and foreign institutional investors (FIIs) bought stocks worth ₹5,236.28 crore.

5. What is the nature of the trade agreement between the US and India?

Beginning on August 27, 2025, the US will reduce tariffs on Indian imports from 50% to 18% under the trade framework. It is anticipated that this action will boost trading and have a favorable effect on market mood.

Conclusion

The Indian stock market opened higher, supported by strong foreign inflows and optimism around the India-US trade deal. The surge was constrained by the global weakness of the IT industry, despite improvements in key industries like finance and energy. For further market direction, investors will probably keep an eye on trade deal developments, IT stock performance, and foreign fund flows.

Disclaimer

This content is for informational purposes only and does not constitute financial advice. Please consult a professional before making any investment decisions.