Terrific Tuesday for markets! Sensex surges 1,600 pts, Nifty reclaims 23,300 level; key factors behind rally

The Indian stock market registered strong rally on Tuesday, with the benchmark indices surging over 2%, mirroring positive trends across global markets amid optimism over the prospect of further exemptions on trade tariffs by the U.S. President Donald Trump’s administration. The market opened sharply higher today after Monday’s holiday as sentiments were lifted after Trump last week announced a temporary exemption in tariffs on smartphones, computers and various electronics imported from a proposed 125% duty on Chinese goods and a 10% global flat rate.

The BSE Sensex ended higher by 1,577 points, 2.1%, at 76,735, and the NSE Nifty50 rose 500 points, or 2.19%, to reclaim 23,329 level. Outperforming the benchmark indices, the broader market ended higher by 3%. The BSE midcap and smallcap indices settled 3.02% and 3.2% higher, respectively. Driven by broad-based rally across indices, the total market capitalisation of BSE-listed firms surged by ₹10 lakh crore to ₹412.5 lakh crore.

On the BSE Sensex pack, barring ITC and HUL , all other 28 constituents ended in positive terrain, with IndusInd Bank , Tata Motors , L&T , Axis Bank , and Adani Ports emerging as top gainers, rising between 4-7%. Reliance Industries, the country’s most valued firm, ended 1.6% higher.  

As per the BSE data, 456 stocks hit their respective upper circuit, while 175 shares were locked in their lower circuit limits during the session. As many as 91 stocks touched their 52-week high levels, whereas 49 firms slipped to their 52-week low marks.

The market width, indicating the overall strength, was positive, with 3,280 stocks out of total traded shares of 4,250 ending in positive terrain. On the other hand, 806 shares settled in red zone, while 164 shares closed unchanged.

Here are key factors that boosted market sentiments today:

Trump’s tariff exemptions

Days after announcing three-month pause on all “reciprocal” tariffs, Donald Trump on late Friday exempted smartphones, computers, and other electronics from its proposed levy imposed on imports. As per the new guidance from U.S. Customs and Border Protection, electronic devices and components, including semiconductors, solar cells, flat panel TV displays, flash drives, and memory cards, will be also exempted from reciprocal tariffs.

On April 10, President Trump had announced a complete three-month pause on all the reciprocal tariffs, with the exception of China. The U.S. had earlier announced a 10% baseline tariff on almost all imports effective April 5, 2025, and a higher 26% tariff specifically on Indian goods, effective April 9, 2025.

Strong rally in auto stocks on hopes of pause in tariffs

Shares of automobile companies witnessed broad-based buying today, with index heavyweight Tata Motors emerging as top gainer amid report that U.S. President Donald Trump is exploring a pause in auto tariffs he recently imposed on the sector. The Trump administration, which announced 25% tariffs on imports of autos and auto parts, is considering giving time to car manufacturers to adjust their supply chains.

Cheering the news, Indian automobile companies - Tata Motors, Samvardhana Motherson, Sona Blw Precision Forgings, and Eicher Motors - which have maximum exposure to U.S. market witnessed strong buying, rising up to 10% intraday. Auto heavyweights Mahindra and Mahindra, Maruti Suzuki India, Hyundai Motor India, and Hero Motocorp,Eicher Motors, SML ISUZU, Ashok Leyland, and OLA Electric Mobility also ended in green.

Firm global cues

The positivity in the domestic bourses were also injected by firm cues from global peers, with Asian stocks ending mostly higher, tracking overnight gains in Wall Street. All three major indexes closed higher in a choppy trade, with the S&P 500 and Dow Jones Industrial Average adding 0.8% each, while the NASDAQ Composite rose 0.6% on Monday.

In Asia-Pacific region, Japan’s Nikkei 225 rose 0.8% and South Korea’s Kospi gained 0.9%, while Australia’s ASX 200 index closed 0.46% higher. Singapore’s Straits Times was the top performer in the region, with a 2.1% gain, followed by Taiwan’s Weighted stock index, which rallied 1.7%. Indonesia’s Jakarta Composite also gained over 1%, while Hong Kong’s Hang Seng and China’s Shanghai Composite ended with modest gains.

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