Asian Markets Dip Amid Trade Tensions, But Indian Stocks Surge: 3 Key Reasons Behind the Rally

Asian Markets Dip Amid Trade Tensions: The Indian stock markets opened on a higher note on Friday, days after US President Donald Trump announced a 90-day postponement of reciprocal tariffs for 75 countries including India, amid an escalating trade war with China.

The BSE Sensex jumped 1,061.26 points to open at 74,941.53, while the NSE Nifty climbed 354.90 points, starting the day at 22,754.05. The sharp uptick in Indian equities reflected improved investor sentiment after the temporary easing of global trade tensions..

The NSE Nifty rose 354.90 points to begin the day at 22,754.05. The BSE Sensex jumped 1,061.26 points to open at 74,941.53. The dramatic increase in Indian stocks was a reflection of better investor mood following the brief relaxation of trade tensions worldwide.

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While other Asian markets were in decline, the Indian stock indexes saw a dramatic increase..

After US stocks relinquished a large portion of their historic gains from the previous day, Asian shares fell on Friday. According to AP, Japan's Nikkei 225 share index first fell 5.6% as a result of growing concerns about Trump's trade war.

It was down 4.2% at 33,148.45 by mid-morning in Tokyo..

The Kospi in South Korea dropped 1.3% to 2,413.16. Shanghai's stock dropped 0.2% to 3,218.94 and Hong Kong's Hang Seng fell 0.4% to 20,606.04 in the Chinese markets..

Why are Indian stocks rising in the midst of the Asian markets' decline? The following are some potential explanations:-.

Trump's tarrif pause

US President Donald Trump declared on Wednesday that the most burdensome new tariffs would be suspended for 90 days for all nations other than China.

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The exemption for Indian exports to the US is a key component of the tariff pause, according to Avinash Gorakshkar, Head of Research at Profitmart Securities, who spoke to HT's sister publication Mint. This exemption fuelled buying on the Dalal Street in the early morning hours..

India's edge in the US-China trade war?

At least 145% of Chinese imports are now subject to President Donald Trump's tariffs, which is significantly higher than what many analysts predicted would destroy US-China trade..

Higher tariffs on China, however, are thought to have the potential to increase Indian exports to the US.

p>"While intra-day volatility is expected to persist, one positive factor for India is that higher US tariffs on China may boost Indian exports to the US. Additionally, China's retaliation could trigger a shift in FIIs from China to India," Vikas Jain, Head of Research at Reliance Securities, told PTI.

RBI repo rate cut

Anshul Jain, Head of Research at Lakshmishree Investment and Securities, told Mint the market estimates that the repo rate cut and “accommodative stance” by the RBI mean no liquidity shortage. Jain added that it is also playing a role in the stock market rally.

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