Sensex & Nifty Rally on US Trade Deal Hopes | Markets Surge in Early Trade Sensex today

Sensex & Nifty Rally on US Trade Deal Hopes: Domestic equity indices Sensex and Nifty50 opened higher on Wednesday after US President Donald Trump said the world’s largest economy could reach a trade deal with India.

Buying in IT blue-chip stocks also drove the equity markets higher during the initial trade.

The 30-share BSE Sensex rose 236.56 points to 83,933.85 in early trade. The 50-share NSE Nifty went up by 66.3 points to 25,608.10.

From the Sensex stocks, Infosys, Tech Mahindra, Tata Steel, Sun Pharma, Tata Consultancy Services and Tata Motors were among the top gainers.

However, Bajaj Finserv, Asian Paints, Bharat Electronics, and Bajaj Finance were among the laggards.

India’s manufacturing sector growth rose to a 14-month high of 58.4 in June, driven by improvement in output and new orders and a record high employment, a monthly survey said on Tuesday.

Adding to the positivity, US Treasury Secretary Scott Bessent also said both countries are making progress towards an agreement that could help India avoid sharp tariff hikes. The deal is being watched closely ahead of Trump’s July 9 deadline to impose higher tariffs.

Nifty and Sensex had remained flat in the last two sessions after their recent upmove. But the latest news from the US has brought hopes back.

Speaking on the trend, VLA Ambala, Sebi Registered Research Analyst and Co-Founder of Stock Market Today, said the upcoming trade agreement will impact some sectors more than the broader market. According to Ambala, sectors like agriculture, auto, gems and jewellery, textiles, electronics, pharmaceuticals, energy, renewable energy and electric vehicles, and handicrafts will be the most affected.

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Ambala said the Nifty index has support at 25,460 and 25,630 is the resistance level. A clear move beyond this range can trigger 1-2% move. She expects the index to find support in 25,300-25,460 and resistance around 25,630-25,850 in the next trading session.

"The market is expected to open on a positive note, supported by strong domestic cues such as a 14-month high in manufacturing PMI, a narrowing trade deficit, and optimism around a potential trade agreement with the US," Vikas Jain, Head of Research at Reliance Securities, said in his pre-market views.

Also, gross GST collections grew 6.2% year-on-year to ₹1.84 lakh crore in June. While this is lower than the ₹2 lakh crore mark achieved in the last two months, it’s still a healthy collection and economic activity. Asian stocks fell and the dollar was near 3-1/2 year low on Wednesday as investors weighed interest rate cuts and trade deals ahead of Trump’s July 9 deadline for tariffs.

The GST mop-up stood at ₹1.74 lakh crore a year ago, as per government data released on Tuesday.

"After breaking the 24,500-25,000 range Nifty has moved to the new range of 25,200-25,800. Positive news about a possible trade deal between India and the US can help break the upper limit of the range but it would be difficult to sustain the Nifty at higher levels for long. A surprise element is the resilience of the US economy and corporate earnings, which in turn is imparting resilience to the US market, despite the tariffs," VK Vijayakumar, Chief Investment Strategist, Geojit Investments, said.

Asian stocks slipped on Wednesday and the dollar languished near 3-1/2-year lows as investors weighed the prospect of U.S. interest rate cuts and the scramble for trade deals ahead of President Donald Trump's July 9 deadline for tariffs.

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Trump said he was not considering extending the July 9 deadline for countries to negotiate trade deals with the United States, and cast doubts again that an agreement could be reached with Japan, although he expects a deal with India.

MSCI's broadest index of Asia-Pacific shares outside Japan eased 0.23% in early trading, inching away from the November 2021 top it touched last week. Japan's Nikkei fell 0.78%, dragged by tech stocks.

Tech-heavy Taiwan stocks and South Korea's Kospi Index also fell after U.S. tech firms were hit hard following a strong rally in June.

The Foreign institutional investors (FIIs) extended their selling on July 1 as they sold equities worth Rs 1,970 crore, while Domestic institutional investors (DIIs) continued their buying as they bought equities worth Rs 771 crore on the same day.

Oil futures were flat on Wednesday as markets await more supply from major producers next month, a softer dollar, and mixed economic and market data from the US, the largest oil consumer.

Brent crude was up 2 cents at $67.13 a barrel at 0345 GMT, while U.S. West Texas Intermediate crude fell 1 cent to $65.44 a barrel.

Indian rupee fell 3 paise to 85.62 against the US dollar in early trade. Dollar index, which tracks the movement of the greenback against a basket of six major currencies, declined 0.13% to 96.69.

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