Global Market Boost
The Indian equity benchmarks experienced a strong upward momentum on Monday, following a pause in the previous week's rally. This resurgence was largely
due to the positive outlook surrounding the impending US-China trade deal. Furthermore, softer-than-expected US inflation data fueled expectations of two additional rate cuts in 2025. This optimistic environment was further bolstered by comments from US Treasury Secretary Scott Bessen. He indicated that President Trump's proposed 100% tariffs on Chinese goods were no longer under consideration, alongside China's commitment to increase soybean imports and postpone restrictions on rare earth exports. The Nifty MidCap and Nifty SmallCap indices also reflected this positive trend, rising by 0.93% and 0.82%, respectively, contributing to the broader market gains. In other parts of Asia, South Korea's Kospi increased by 1.99%, while Australia's ASX 200 also saw an increase of 0.49%.
Trade Deal Optimism
A significant driving force behind the Indian market's upward movement was the progress in trade negotiations between the US and China. Reports suggested that negotiators from both nations had reached a framework agreement to address major trade disputes. The US Treasury Secretary’s remarks confirmed that the 100% tariffs on Chinese goods proposed by President Trump were off the table. China, in turn, had agreed to increase its soybean imports and delay restrictions on rare earth exports. This positive development injected optimism into the markets. The Indian stock markets started higher on Monday, as investors closely monitored the progress of trade discussions between the US and China. This positive sentiment was palpable as investors reacted favorably to the news, fueling the rise in key market indices.
Wall Street's Influence
Wall Street played a crucial role in shaping the positive sentiment observed in the Indian market. All three major indices — the Dow Jones, S&P 500, and Nasdaq — closed Friday at record highs. This was attributed to easing inflation, which strengthened expectations of more interest rate cuts by the Federal Reserve. The Dow specifically closed above 47,000 for the first time. Market participants are now awaiting Big Tech earnings and the Fed’s forthcoming policy decision. This global performance provided a favorable backdrop for Asian markets. The positive performance in the US markets created a ripple effect, bolstering the confidence of investors in other markets, including India.
Sensex and Nifty Climb
The BSE Sensex experienced a substantial gain, increasing by 566.96 points, or 0.67%, and concluding the day at 84,778.84. Similarly, the NSE Nifty50 advanced by 170.9 points, or 0.67%, closing at 25,966.05. These figures demonstrate the strong performance of Indian equities. The gains in the indices reflect the market's response to both domestic and international factors. The overall upward movement highlighted the positive investor sentiment. The performance of key market indicators showed a clear indication of the market's favorable response to global cues and news related to the US-China trade talks.
Asian Market Performance
Asian markets began the week on a strong note, mirroring Wall Street’s record rally and fueled by the optimism surrounding US-China trade negotiations. Japan’s Nikkei 225 surged past the 50,000 mark for the first time, increasing over 2%, and the broader Topix index advanced 1.52%. Prime Minister Sanae Takaichi is scheduled to meet US President Donald Trump in Tokyo later in the week, further fueling this positive sentiment. This positive sentiment was not limited to Japan; other regional markets also benefited from the positive outlook. The widespread gains across Asian markets demonstrated a strong sense of confidence across the region.
