Mumbai: Benchmark Indian equity indices witnessed a sharp rally in early trade on Friday after the United States announced a 90-day suspension of additional tariffs on Indian exports. The decision, effective until July 9, provided a significant boost to investor sentiment, propelling the Sensex and Nifty to substantial gains.
The 30-share BSE Sensex surged by 1,236.64 points to reach 75,083.79, while the broader NSE Nifty jumped 415.70 points to 22,814,.80. The market rally came after the White House confirmed the temporary suspension of punitive tariffs imposed under a sweeping trade action announced by US President Donald Trump on April 2.
Trump’s Tariff Shock Reversed Temporarily
Earlier this month, Trump had levied universal duties on exports from around 60 countries, including India. The move involved steep tariffs on various products such as shrimp and steel, which threatened to impact India's trade with the world’s largest economy. The sudden tariff freeze has now calmed nerves on Dalal Street, at least for the short term.
Top Performers and Laggards
Among the top gainers from the Sensex pack were Tata Motors, Sun Pharma, Tata Steel, HCL Tech, Tech Mahindra, Bajaj Finserv, Adani Ports, and Reliance Industries. In contrast, Asian Paints and Nestle India were the only notable laggards during the morning trade.
Mixed Global Cues
Despite the upbeat sentiment in Indian markets, global cues remained mixed. The US stock markets closed significantly lower on Thursday, with the Nasdaq plummeting 4.31%, the S&P 500 losing 3.46%, and the Dow Jones Industrial Average falling 2.50%. In Asia, Tokyo’s Nikkei 225 dropped 4%, while Shanghai’s SSE Composite and Hong Kong’s Hang Seng edged slightly higher.
Analysts Caution on Sustainability
Market experts remain cautiously optimistic. Vikas Jain of Reliance Securities noted that increased tariffs on China may indirectly benefit Indian exports and attract foreign portfolio flows. VK Vijayakumar of Geojit Investments warned, however, that while India’s macroeconomic stability is a positive, the global uncertainty limits the scope for a sustained rally.
Foreign Fund Outflows and Oil Prices
Foreign Institutional Investors (FIIs) sold equities worth Rs 4,358.02 crore on Wednesday. Meanwhile, Brent crude oil prices dipped slightly by 0.36% to USD 63.10 per barrel, offering some relief on the inflation front.
