Indian benchmark indices Sensex and Nifty 50 are set to open sharply higher on Tuesday after US President Donald Trump said India and the United States have agreed to a overnight trade deal following his conversation with Prime Minister Narendra Modi.

Trump announced that the US will cut reciprocal tariffs on Indian goods to 18% from 25%, while India will reduce tariffs and non-tariff barriers on US goods to zero. This India–US trade agreement boosted global risk appetite.

Asian markets rallied, and the US stock market closed higher overnight, driven by gains in technology stocks.

Moreover, on Monday, Indian equities ended with strong gains, recovering a part of the losses from the previous session.

Domestic Market Recap

On Monday, Indian indices closed in the green:

• Sensex soared by 943.52 points (1.17%) to close at 81,666.46
• Nifty 50 moved up by 262.95 points (1.06%) to settle at 25,088.40

Gift Nifty

Gift Nifty was trading near 25,939, around 797 points higher than the previous Nifty futures close, hinting at a blockbuster start for Indian markets.

Overnight Wall Street Performance

The US stock market closed higher on Monday, driven by strong gains in chipmakers and other artificial intelligence–linked companies.

• The Dow Jones Industrial Average soared by 515.19 points (1.05%) to close at 49,407.66.
• S&P 500 up by 37.41 points (0.54%), ending at 6,976.44.
• The Nasdaq Composite was higher by 130.29 points (0.56%), finishing at 23,592.11.

Gold Prices

• Spot gold was trading 4.07% higher at $4,822.56 per ounce.
• The US gold futures were higher by 4.27% at $4,851.34.

Crude Oil Prices

• Brent crude gained by 0.1% to $66.36/barrel
• US West Texas Intermediate (WTI) crude was trading 0.2% higher at $62.24/barrel

Overnight Major Global Events Driving Sentiment

1. India–US Trade Deal: US President Donald Trump said he spoke with Prime Minister Narendra Modi and announced a series of trade agreements aimed at strengthening ties between the United States and India. He added that the US will cut reciprocal tariffs on Indian imports to 18% from 25%.
2. US PMI: US manufacturing activity expanded for the first time in a year in January. Data from the Institute for Supply Management showed the manufacturing PMI jumped to 52.6, its highest level since August 2022, from 47.9 in December, after remaining in contraction for ten consecutive months.

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