Sensex Jumps 485 Points, Nifty Tops 25,850 on Trade Deal

Market Rallies on Trade Optimism

Indian equity markets started the week on a strong note, extending gains for a second consecutive session on Monday, February 9. Positive sentiment driven by an interim India-US trade framework, coupled with robust buying in public sector banks and a revival of foreign investor interest, propelled the benchmark indices to significant highs. The market demonstrated broad-based strength, with both midcap and smallcap indices outperforming their larger counterparts.

At the closing bell, the 30-share BSE Sensex concluded the session at 84,065.75, marking a substantial gain of 485.35 points, or 0.58%. During the day's trading, the index reached an intraday high of 84,314.68. Similarly, the 50-share NSE Nifty 50 finished at 25,867.30, up by 173.60 points, or 0.68%. The Nifty touched a high of 25,922.25 during the session before paring some of its gains.

India-US Trade Deal Fuels Investor Confidence

One of the primary catalysts for the market's upward momentum was the announcement of an interim trade framework between India and the United States. According to the agreement, the US will reduce reciprocal tariffs on several Indian goods, including textiles and apparel, to 18%. This development has removed a significant overhang for the market, improving export visibility and encouraging foreign capital inflows. Foreign Institutional Investors (FIIs) have been net buyers in recent sessions, purchasing shares worth ₹1,950.77 crore on the preceding Friday, signaling renewed confidence in the Indian economy.

Broad-Based Sectoral Gains

The rally was not confined to the headline indices. Market breadth was decisively positive, with 3,003 shares advancing against 1,181 declining on the BSE. All sectoral indices on the NSE ended the day in the green. The Nifty PSU Bank index was a standout performer, surging over 3%, largely driven by a stellar performance from State Bank of India. Other sectors, including media, consumer durables, realty, pharma, healthcare, and metal, also posted impressive gains ranging from 1% to 3%. The broader market showed even greater strength, with the Nifty Midcap 100 index rising 1.6% and the Nifty Smallcap 100 index jumping 2.6%.

Key Market Data Summary

Top Movers and Shakers

State Bank of India (SBI) was the day's top gainer on the Nifty, with its shares soaring nearly 7.5% following strong third-quarter results. The rally also helped SBI become the sixth Indian firm to surpass a market capitalization of Rs 10 lakh crore. Other major gainers included Shriram Finance, which jumped over 4.6%, along with Grasim Industries, Titan Company, and Dr. Reddy's Laboratories, all of which rose between 2% and 3%.

On the other hand, some stocks faced selling pressure. Max Healthcare was the top loser on the Nifty, slipping around 2.5%. Other notable laggards included Power Grid Corporation, ITC, ONGC, and NTPC, which registered declines.

Analyst Perspectives on the Market

Market analysts attributed the positive momentum to a combination of factors. Vinod Nair, Head of Research at Geojit Investments, noted that positive signals from the trade deal and the return of FIIs fueled a risk-on sentiment. He also pointed to the stronger-than-anticipated performance of PSU banks and an accumulation strategy in consumer durables and real estate stocks. Nagaraj Shetti, Senior Technical Research Analyst at HDFC Securities, observed that the underlying trend for the Nifty remains positive, with potential upside levels around 26,000 and 26,350 in the near term, while immediate support is placed at 25,700.

Global Cues and Outlook

The positive sentiment in the domestic market was supported by strong global cues. Asian markets, including Tokyo's Nikkei 225, ended with significant gains. The upbeat performance on Wall Street in the previous session also contributed to the optimistic start on Dalal Street. Looking ahead, the market's trajectory will likely be influenced by ongoing corporate earnings, FII activity, and further developments related to global trade dynamics. While the near-term outlook remains positive, analysts suggest that some profit-taking and short-term volatility cannot be ruled out after the recent sharp rally.