Investors earn Rs 13 lakh crore! Sensex, Nifty log best session in 8 months; what’s next?

Domestic equity benchmarks Sensex and Nifty extended their rally for a second consecutive session on Tuesday, ending with their biggest single-day percentage gains in nearly eight months since May 12, 2025, as investor sentiment got a decisive boost from the long-awaited India–US trade deal that had been an overhang on markets for months. The agreement brings a sharp cut in tariffs on Indian goods to 18 per cent from an earlier 50 per cent.

In early trade, the Sensex and Nifty surged as much as 5.1 per cent and 4.9 per cent, respectively, marking one of the sharpest single-day rallies in market history.

Investor wealth surged sharply in the session as the combined market capitalisation of BSE-listed companies increased by over Rs 12.75 lakh crore to Rs 467.10 lakh crore, compared with Rs 454.35 lakh crore in the previous session.

At close, the Sensex surged 2072.67 points, or 2.54 per cent, to settle at 83,739.13, while the Nifty gained 639.15 points, or 2.55 per cent, to end at 25,727.55. 

Domestic equities experienced a significant rally today, driven by the long-awaited India-US trade deal and a strengthening rupee, which boosted expectations of renewed FII inflows, said Vinod Nair, Head of Research at Geojit Investments Limited.

Adani Ports and Special Economic Zone emerged as top gainer on the Sensex, rising 9.12% to Rs 1530.90. Bajaj Finance followed with a 6.68% jump, while InterGlobe Aviation (IndiGo), Power Grid, Sun Pharma and Bajaj Finserv advanced 5.51%, 4.85%, 4.63% and 4.29%, respectively. 

Export-oriented and commodity-linked stocks led the charge, particularly textiles, chemicals and auto ancillaries, while financials, realty, pharma and IT counters also participated in the rally. Mid- and small-cap stocks joined the upmove, aided by strong risk appetite and short-covering. The rupee strengthened in tandem with equities, signalling improved external confidence and easing trade-related concerns, said Ponmudi R, CEO of Enrich Money.

Five stocks, namely Reliance Industries, HDFC Bank, ICICI Bank, Bajaj Finance and State Bank of India (SBI), contributed heavily to the Sensex’s surge.  

Among sectoral indices, the BSE Utilities index surged 3.92% to close at 5,190.13, while the BSE Auto climbed 2.88% to settle at 60,988.47. 

In the Sensex index, shares of Axis Bank, HCL Technologies, State Bank of India (SBI) and Tech Mahindra hit their fresh 52-week high on BSE.

Market breadth remained positive on the BSE. Of the 4,422 actively traded stocks, 3,304 ended in the green, while a dominant 981 declined and 137 settled unchanged. The session saw 121 stocks scaling fresh 52-week highs, compared with 117 counters sliding to new 52-week lows. In addition, 11 scrips were locked at their upper circuits, whereas 10 hit lower circuit limits.

Ponmudi said the immediate support remains at 25,500–25,600, while the 25,900–26,000 zone is a key psychological and supply hurdle. He cautioned that unless the index sustains above 25,850–25,900 with strong participation, the risk of a near-term pullback cannot be ruled out, even as overall sentiment has turned constructive following the trade deal.

“The reduction of US tariffs on Indian goods from 50% to 18% enhances India’s competitive position among emerging markets and bolsters the outlook for export‑oriented sectors with high US exposure, such as textiles, aquaculture, gems and pharmaceuticals, which were supported in the 2026 Union Budget,” Nair said

Nair said that overall market sentiment has shifted decisively positive, with global trade risks easing and the US-Iran conflict moderating. “Going forward the markets could focus more on the ongoing Q3 corporate results with a positive bias, which till date have been below estimates, because of potential future earnings upgrades led by reduction in tariff risk," he added.