Markets Daily India

Trump’s Tariff Cuts Set to Embolden India Stock Bulls

Much-awaited trade deal could also bring reprieve for the rupee.

US President Donald Trump and India’s Prime Minister Narendra Modi during a news conference in Washington, DC early last year. Photographer: Francis Chung/Politico/Bloomberg

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By Rajesh Mascarenhas and Alex Gabriel Simon

February 3, 2026 at 2:47 AM UTC

This article is for subscribers only.

Good morning...

I’m Ashutosh Joshi, an equities reporter in Mumbai, bringing you the daily dose of news and analysis on Indian markets.

It’s just what the doctor ordered! In what could prove to be a game changer for the struggling stock market, US President Donald Trump has said he would cut tariffs on Indian goods to 18% from 25% in return for an agreement that Prime Minister Narendra Modi would stop buying Russian oil. Trump is also removing an extra punitive 25% duty applied in response to India’s purchases of crude from Russia. Remember the delay in signing a trade deal with the US was one of the key overhangs for India’s stock market, which has extended its underperformance versus Asia in the new year. And the initial market response — Nifty 50 futures traded at GIFT City surged as much as 4.5% overnight (and more on that later) and another about 3% this morning — suggests that this development may just revive the animal spirits and help India bounce back. Early gains in Asian equities on Tuesday should also aid sentiment.

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