India-US trade deal: Gift Nifty up 800 pts on Trump tariff cuts, eyes on Terrific Tuesday
Trump said he has agreed to a trade deal between the US and India, whereby the US will charge a reduced reciprocal tariff, lowering it from 25 per cent to 18 per cent.
- Feb 2, 2026,
- Updated Feb 2, 2026 11:34 PM IST
Stock market benchmarks Nifty and Sensex look set to rally on Tuesday after US President Donald Trump announced an India-US trade deal that reduces tariffs on US imports from India to 18 per cent from 25 per cent earlier, improving India’s competitiveness. The announcement by Trump on a social media platform sent Gift Nifty soaring over 800 points to hit a high of 25,962.50. At 11.25 IST, Gift Nifty was still trading 795 points, or 3.16 per cent, higher at 25,926.
The trade deal came at a time when the market was factoring in extended delays. It is also announced days after India announced the "mother of all deals" with the EU.
"India US trade deal has gone through ups and downs like a roller coaster. While devil is in the details, it removes a hanging sword over rupee, equity and rates market. Let us hope that it is a win win deal for both the countries as they have lot to gain through cooperation," said Nilesh Shah, MD at Kotak Mahindra AMC.
In a post, Trump said: "It was an Honor to speak with Prime Minister Modi, of India, this morning. He is one of my greatest friends and, a Powerful and Respected Leader of his Country. We spoke about many things, including Trade, and ending the War with Russia and Ukraine. He agreed to stop buying Russian Oil, and to buy much more from the United States and, potentially, Venezuela. This will help END THE WAR in Ukraine, which is taking place right now, with thousands of people dying each and every week!"
Trump said he has agreed to a trade deal between the US and India, whereby the US will charge a reduced reciprocal tariff, lowering it from 25 per cent to 18 per cent.
"They will likewise move forward to reduce their tariffs and non tariff barriers against the United States, to ZERO. The Prime Minister also committed to “BUY AMERICAN,” at a much higher level, in addition to over $500 BILLION DOLLARS of U.S. Energy, Technology, Agricultural, Coal, and many other products. Our amazing relationship with India will be even stronger going forward."
To recall, Trump had announced reciprocal tariffs of 25 per ent on India in April, but India was expected to strike an early agreement with the US administration and lower them.
In August, when the American President announced an additional penal tariff of 25 per cent on most of India’s merchandise exports to the United States on top of the reciprocal tariff of 25 per cent announced in April, it surprised many since India was expected to be one of the early winners in the new tariff regime of the United States, Economic Survey noted on January 29. Growth forecasts were revised downward. But in reality, growth accelerated due to a slew of structural reforms and policy measures, the survey noted.
Nifty underperformed peer emerging markets, as the index is up 7 per cent in the past one year compared with 36.94 per cent rise in the MSCI EM index during the same period. "A revival in equities is heavily dependent on a recovery in the rupee. The recent gold price crash should help – as should an early conclusion of the India-US trade deal," Emkay Global said earlier today.
"Our amazing relationship with India will be even stronger going forward. Prime Minister Modi and I are two people that GET THINGS DONE, something that cannot be said for most. Thank you for your attention to this matter," he added.
US Ambassador to India and Special Envoy to South and Central Asia, Sergio Gor in posts on X said Trump spoke with the PM Narendra Modi. He later said: "I have said many times, President Trump genuinely considers Prime Minister Modi a great friend! Thrilled by the news of the trade deal this evening. The relationship between the United States and India has LIMITLESS POTENTIAL!."
Stock market benchmarks Nifty and Sensex look set to rally on Tuesday after US President Donald Trump announced an India-US trade deal that reduces tariffs on US imports from India to 18 per cent from 25 per cent earlier, improving India’s competitiveness. The announcement by Trump on a social media platform sent Gift Nifty soaring over 800 points to hit a high of 25,962.50. At 11.25 IST, Gift Nifty was still trading 795 points, or 3.16 per cent, higher at 25,926.
The trade deal came at a time when the market was factoring in extended delays. It is also announced days after India announced the "mother of all deals" with the EU.
"India US trade deal has gone through ups and downs like a roller coaster. While devil is in the details, it removes a hanging sword over rupee, equity and rates market. Let us hope that it is a win win deal for both the countries as they have lot to gain through cooperation," said Nilesh Shah, MD at Kotak Mahindra AMC.
In a post, Trump said: "It was an Honor to speak with Prime Minister Modi, of India, this morning. He is one of my greatest friends and, a Powerful and Respected Leader of his Country. We spoke about many things, including Trade, and ending the War with Russia and Ukraine. He agreed to stop buying Russian Oil, and to buy much more from the United States and, potentially, Venezuela. This will help END THE WAR in Ukraine, which is taking place right now, with thousands of people dying each and every week!"
Trump said he has agreed to a trade deal between the US and India, whereby the US will charge a reduced reciprocal tariff, lowering it from 25 per cent to 18 per cent.
"They will likewise move forward to reduce their tariffs and non tariff barriers against the United States, to ZERO. The Prime Minister also committed to “BUY AMERICAN,” at a much higher level, in addition to over $500 BILLION DOLLARS of U.S. Energy, Technology, Agricultural, Coal, and many other products. Our amazing relationship with India will be even stronger going forward."
To recall, Trump had announced reciprocal tariffs of 25 per ent on India in April, but India was expected to strike an early agreement with the US administration and lower them.
In August, when the American President announced an additional penal tariff of 25 per cent on most of India’s merchandise exports to the United States on top of the reciprocal tariff of 25 per cent announced in April, it surprised many since India was expected to be one of the early winners in the new tariff regime of the United States, Economic Survey noted on January 29. Growth forecasts were revised downward. But in reality, growth accelerated due to a slew of structural reforms and policy measures, the survey noted.
Nifty underperformed peer emerging markets, as the index is up 7 per cent in the past one year compared with 36.94 per cent rise in the MSCI EM index during the same period. "A revival in equities is heavily dependent on a recovery in the rupee. The recent gold price crash should help – as should an early conclusion of the India-US trade deal," Emkay Global said earlier today.
"Our amazing relationship with India will be even stronger going forward. Prime Minister Modi and I are two people that GET THINGS DONE, something that cannot be said for most. Thank you for your attention to this matter," he added.
US Ambassador to India and Special Envoy to South and Central Asia, Sergio Gor in posts on X said Trump spoke with the PM Narendra Modi. He later said: "I have said many times, President Trump genuinely considers Prime Minister Modi a great friend! Thrilled by the news of the trade deal this evening. The relationship between the United States and India has LIMITLESS POTENTIAL!."