Post Session: Quick Review

Indian equity markets continued their previous session’s strong northward rally on Tuesday, with both the Nifty and Sensex surging by over 2%, following U.S. President Donald Trump's announcement of tariff exemptions for electronic goods. Indices made a gap-opening and maintained their momentum throughout the day, primarily driven by heavy buying in the IT, banking, and energy sectors.

Some of the important factors in trade:

India's wholesale inflation eases to 2.05% in March: Traders got support as inflation based on wholesale price index (WPI) in India eased to 2.05% in March from 2.38% in February, mainly on account of fall in prices of crude petroleum & natural gas, non-food articles and food articles.

India's domestic demand showing recovery signs: 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.

US may pause auto tariffs: Sentiments got boost 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.

Global front: European markets were trading in green after U.S. President Donald Trump said he was considering a modification to the 25 percent tariffs imposed on foreign auto and auto parts imports from Mexico, Canada and other countries. Asian markets ended in green as Japan's industrial production rebounded in February but at a slower than initially estimated pace. Industrial production grew 2.3% month-on-month in February, reversing January's 1.1% decline. 

The BSE Sensex ended at 76734.89, up by 1577.63 points or 2.10% after trading in a range of 76435.07 and 76907.63. There were 28 stocks advancing against 2 stocks declining on the index. (Provisional)

The broader indices ended in green; the BSE Mid cap index was up by 3.02%, while Small cap index up by 3.21%. (Provisional)

The top gaining sectoral indices on the BSE were Realty up by 5.81%, Industrials up by 3.76%, Capital Goods up by 3.67%, Auto up by 3.39% and Consumer Discretionary up by 3.12%, while no losing sectoral indices on the BSE. (Provisional)

The top gainers on the Sensex were Indusind Bank up by 6.70%, Tata Motors up by 4.61%, Larsen & Toubro up by 4.50%, Axis Bank up by 4.23% and Adani Ports and Special Economic Zone up by 4.13%. On the flip side, ITC down by 0.28% and Hindustan Unilever down by 0.28% were the only losers. (Provisional)

Meanwhile, the Moody's Ratings in its latest report has said that uncertainties around the US trade policy will undermine business confidence and consumer sentiment, adversely impacting growth in Asian nations, including India. US President Donald Trump has postponed by three months the imposition of reciprocal tariffs, with the exception of China on whom a 125 per cent tariff has been slapped. However, a 10 per cent additional duty on exports to the US will continue. Moody's Analytics, another Moody's firm, had last week cut India's growth forecast for the 2025 calendar year to 6.1 per cent in 2025 from 6.4 per cent projected in February. 

Moody's Ratings Senior Vice President, Credit Strategy & Guidance, Nicky Dang has said that an escalation of US-Sino tensions and the spillover effects from a slowdown in China pose significant downside risks to the (Asian) region's growth prospects. She said economies with large domestic markets, such as India, may benefit from companies seeking access to these markets but any major shift in investment flows would occur over several years. 

Dang said the tariff pause mitigates the negative impact of the additional tariffs on the region's trade and growth. However, economies in the region still face considerable downside risk due to an additional 10 per cent universal tariffs and their high direct and indirect exposures to the US. Furthermore, the additional tariffs on Chinese exports, which were not included in the pause, exert further pressure on China's growth. She added that the tariff pause does not reverse the trend of de-globalisation but increases trade policy uncertainty, as the Trump administration's goal of reshoring manufacturing supply chains to the US remains unchanged.

The CNX Nifty ended at 23328.55, up by 500.00 points or 2.19% after trading in a range of 23207.00 and 23368.35. There were 49 stocks advancing against one stock declining on the index. (Provisional)

The top gainers on Nifty were Indusind Bank up by 6.67%, Shriram Finance up by 5.17%, Larsen & Toubro up by 4.59%, Tata Motors up by 4.58% and Axis Bank up by 4.35%. On the flip side, ITC down by 0.27% was the sole loser. (Provisional)

European markets were trading higher; Germany’s DAX gained 250.15 points or 1.19% to 21,204.98, UK’s FTSE 100 increased 72.53 points or 0.89% to 8,206.87 and France’s CAC rose 20.35 points or 0.28% to 7,293.47.

Asian markets settled higher on Tuesday tracking Wall Street’s gains overnight buoyed by a rebound in technology shares following a surprise US tariff exemption of smartphones and computers, as well as other devices and components such as semiconductors from US President Donald Trump's new reciprocal tariffs. Japanese shares gained, with companies such as Toyota Motor Corporation shares jumped after Trump said he is exploring a pause in auto tariffs. Moreover, South Korean shares rose ahead of the Bank of Korea's interest-rate decision due on Thursday.