India’s equity markets staged a sharp rebound on Tuesday morning as investors cheered the announcement of a long-awaited India–US trade deal, reversing steep losses triggered by the Union Budget just two days earlier. Benchmark indices Sensex and Nifty50 opened with strong gains, while the rupee also strengthened against the US dollar, reflecting improved market sentiment.

The Sensex jumped more than 3,600 points at the opening bell to cross the 85,000 mark after closing at 81,666.46 on Monday. The Nifty 50 surged by around 1,200 points from its previous close of 25,088.40. The rally followed a statement by US President Donald Trump confirming that the trade agreement between India and the United States had been finalised.

All sectoral indices opened firmly in the green, with realty, auto, consumer durables, and IT stocks leading the charge. Realty stocks rose over 4 per cent, while auto and consumer durables gained close to 4 per cent each. IT stocks also saw solid buying interest, climbing more than 3 per cent in early trade.

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Some early gains were pared as the session progressed. By around 10 am, the Sensex was trading over 2,200 points higher, while the Nifty50 was up by about 650 points. Despite the pullback, both indices remained comfortably in positive territory, underlining the strength of the rebound after recent volatility.

In the currency market, the rupee strengthened by around 1.2 per cent to trade at 90.40 against the US dollar in early deals. Market participants attributed the move to optimism over improved trade terms and the prospect of reduced tariff-related pressure on Indian exports to the US.

Indian markets have seen extreme swings over the past week. After reacting positively to a free trade agreement with the European Union, indices crashed sharply following the union budget, which proposed higher transaction taxes to curb speculative trading. That sell-off wiped out nearly ₹10 lakh crore in investor wealth, making Tuesday’s rally a significant sentiment turnaround driven by hopes of improved global trade prospects.

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