Sensex, Nifty trade firm on US tariff reprieve

Indian equity benchmarks made an optimistic start on Tuesday, following the broadly positive cues from Wall Street overnight as well as mostly higher Asian counterparts after reports the US is considering pausing the 25 percent tariffs on auto imports and decided to exempt certain consumer electronics from its so-called reciprocal tariffs. Sensex and Nifty are trading firm with gains of over 2% each in early deals supported by value buying by fund and retail investors. Some support came as Crisil in its report said that India's domestic demand is showing recovery signs, fueled by healthy rabi output and easing inflation expected in fiscal 2025's fourth quarter. Besides, GTRI in a report said the US crackdown on low-value Chinese e-commerce shipments has opened a rare and potentially lucrative window for Indian exporters.

Traders largely overlooked the government data that India's industrial production growth decelerated to a six-month low of 2.9 per cent in February 2025, mainly due to poor performance of the manufacturing, mining and power sectors. Now, investors are eyeing CPI and WPI data to be out later in the day and also keeping close eye on upcoming corporate Q4 earnings reports. On the sectoral front, technology sector stocks are in focus after the Trump administration announced a pause on tariffs for phones, computers, and consumer electronics. In stock specific development, Zydus Lifesciences rose on receiving final approval from the U.S.FDA to manufacture Jaythari (Deflazacort) tablets.

The BSE Sensex is currently trading at 76734.33, up by 1577.07 points or 2.10% after trading in a range of 76435.07 and 76907.63. There were 27 stocks advancing against 3 stocks declining on the index.

The broader indices were trading in green; the BSE Mid cap index rose 1.92%, while Small cap index was up by 2.29%.

The top gaining sectoral indices on the BSE were Realty up by 4.21%, Capital Goods up by 3.10%, Auto up by 2.93%, Industrials up by 2.90% and Consumer Discretionary up by 2.44%, while there was no loser on the BSE sectoral front.

The top gainers on the Sensex were Tata Motors up by 4.69%, Larsen & Toubro up by 4.09%, Indusind Bank up by 3.85%, HDFC Bank up by 3.51% and Mahindra & Mahindra up by 3.47%. On the flip side, Hindustan Unilever down by 0.74%, Nestle down by 0.54% and ITC down by 0.07% were the few losers.

Meanwhile, exuding confidence in price competitiveness and continued government support, industry body -- PHD Chamber of Commerce and Industry (PHDCCI) has said that the reciprocal tariffs imposed by US President Donald Trump will impact only 0.1 per cent of the Indian Gross Domestic Product (GDP). Hemant Jain, President of PHDCCI said that strong domestic manufacturing and continued government handholding through strategic policy measures, including PLI, Make in India, and Atmanirbhar Bharat, among others, will support India’s growth resilience.

He further stated that India’s strong industrial competitiveness will balance the impact of US tariff announcements, and GDP will see only a 0.1 per cent impact in the short term. However, he added this shortfall will be negated in the medium term as the policy takes full effect. He also said India’s ‘Make in India’ initiative is driving significant progress towards becoming self-reliant. The transition to strengthening domestic consumption will easily absorb the tariff impact. India’s robust demand augurs well for sectors such as electronics, renewable energy, and pharmaceuticals, among others.

He said ‘Ease of doing business and production-linked incentive (PLI) schemes have strengthened domestic supply chains and made India more attractive for investments, boosting manufacturing output and competitiveness’. He added ‘We expect sectors including precious/ semi-precious stones, textiles/apparel, marine products, vehicles, and parts and accessories thereof, articles of iron or steel and chemical products are expected to see a moderately negative to negative impact’.

According to Jain, the pharmaceutical and petroleum products sectors are expected to see a positive impact. He said ‘The 90-day pause announcement is positive news for Indian exporters. However, we need to be cautious because this is a temporary move’. India is a major consumer market with diversified supply and value chains. Its emerging trade partners include the Middle East, South Africa, Latin America, and Asian nations. He said the demand for Indian products has increased in recent years due to their price competitiveness and improved quality. He added ‘Going ahead, given India’s sustained economic development and strategic importance, we expect continuing collaboration with the US through a well-negotiated bilateral trade/ free trade agreement’.

The CNX Nifty is currently trading at 23316.45, up by 487.90 points or 2.14% after trading in a range of 23207.00 and 23368.35. There were 48 stocks advancing against 2 stocks declining on the index.

The top gainers on Nifty were Tata Motors up by 4.73%, Shriram Finance up by 4.53%, Larsen & Toubro up by 4.26%, Indusind Bank up by 4.24% and Trent up by 3.65%. On the flip side, Hindustan Unilever down by 0.68% and Nestle down by 0.48% were the only losers.

Asian markets are trading mostly in green; Nikkei 225 surged 381.95 points or 1.12% to 34,364.31, Taiwan Weighted jumped 355.24 points or 1.82% to 19,868.33, Straits Times rose 65.69 points or 1.85% to 3,614.60, Jakarta Composite gained 56.32 points or 0.88% to 6,424.84, Hang Seng advanced 30.28 points or 0.14% to 21,447.68 and KOSPI increased 23.02 points or 0.94% to 2,478.91, while Shanghai Composite was down by 2.26 points or 0.07% to 3,260.55.