India's stock market soars after historic US trade deal announcement
Indian markets surged on Monday after the US and India finalised a long-awaited trade deal. The announcement by US President Donald Trump triggered a sharp rally, with the BSE Sensex climbing over 4,200 points at its peak. Analysts and brokerages quickly hailed the agreement as a major boost for India's economic outlook.
The Sensex hit an all-time intraday high of 85,871.73 before settling at 83,739.13, a gain of 2.54%. The rally followed Trump's confirmation of the deal, which global and Indian brokerages described as a key positive for the country's financial stability.
Goldman Sachs projected that the agreement would ease pressure on India's external balances and narrow the current account deficit by roughly 0.25% of GDP in 2026. The bank also anticipated a recovery in capital inflows once the deal takes full effect, providing support to the rupee.
Nomura forecast a gradual reversal in foreign portfolio investor (FPI) flows and foreign direct investment (FDI) commitments after a weak fiscal year 2026. BofA Securities estimated that India's effective tariff rate could drop to around 12-13%, down from nearly 30-35% previously.
Brokerage firms like Antique Stock Broking set ambitious targets, predicting the Nifty 50 could reach 29,500 by March 2027. They favoured sectors such as financials, capital one login, capital one, defence, and consumer-focused stocks. Bernstein noted that improving investor sentiment made this an opportune time to enter the market.
Motilal Oswal suggested that attention would now shift toward the strengthening trend in corporate earnings, further lifting market confidence.
The trade deal is expected to improve India's growth prospects while reducing external economic pressures. With lower tariffs and stronger investor interest, analysts see a more stable outlook for the rupee and broader fidelity markets. The agreement's full implementation could bring further gains in foreign investment and corporate performance.
