Benchmark indices staged a powerful rally on Monday after the India–US trade deal finally cleared a major overhang that had weighed on market sentiment for months. The Sensex jumped more than 2,300 points at the opening bell, while the Nifty surged nearly 700 points, marking a decisive shift from caution to optimism.
The agreement slashes US tariffs on Indian goods from 50% to 18%, instantly restoring confidence among investors and exporters. Market strategists described the announcement as a transformational moment for Indian equities, with positive implications for economic growth, corporate earnings and currency stability.
Experts estimate that India’s GDP growth could rise to around 7.5% in FY27, driven by stronger exports to the US. Corporate earnings growth, already showing early signs of recovery, may accelerate to 16–18%, while the rupee is expected to strengthen as foreign portfolio investors return.
The rally has been amplified by aggressive short covering, as markets had been heavily positioned on the downside ahead of the announcement. Analysts expect the upswing to be broad-based across market capitalisations, with largecap stocks in banking, NBFCs, telecom, capital goods, IT and textiles likely to lead the next phase of gains.
Technical indicators have also turned supportive, with both the Sensex and Nifty forming bullish reversal patterns on intraday and daily charts. Analysts believe the improving macro backdrop, supported by the India–US trade deal, progress on other trade negotiations and a growth-focused Union Budget 2026, could mark the beginning of a more sustained upward trend in Indian equities.
