By Bharath Rajeswaran and Vivek Kumar M
(Reuters) – India’s equity benchmarks jumped around 1.5% on Thursday to a seven-month high after U.S. President Donald Trump said India had offered a zero-tariff trade deal to the United States.
The Nifty 50 rose 1.75% to 25,098 and the BSE Sensex gained 1.67% to 82,696.53 as of 2:14 p.m. IST, after trading flat earlier in the session before Trump’s comments.
Tata Motors jumped 4%, propelling the Nifty Auto index around 2% higher. Its luxury car brand Jaguar Land Rover counts the U.S. as its fastest-growing market.
“There is speculation that the trade deal will happen,” said Ambareesh Baliga, an independent market analyst.
New Delhi is seeking to clinch a trade deal with the U.S. within the 90-day pause announced by Trump on April 9 on tariff hikes for major trading partners, which had included a 26% tariff on India.
Twelve of the 13 major sectors rose, with heavyweight financials and information technology stocks rising about 1.5% and 1%, respectively.
The broader small- and mid-caps were up 0.5% each.
“It is very hard to sell in India, and they are offering us a deal where basically they are willing to literally charge us no tariffs,” Trump said in a meeting with executives in Doha.
Trump’s comments signal that India has agreed to effectively drop all tariffs on U.S. goods as part of a potential trade deal, which the markets are taking a positive, said Kranthi Bathini, director of equity strategy at Wealthmills Securities.
However, the optimism could be short-lived as the final draft and finer contours of the India-U.S. trade deal would be crucial for the market rally to sustain, Bathini said.
(Reporting by Bharath Rajeswaran in Bengaluru; Editing by Nivedita Bhattacharjee, Sumana Nandy and Mrigank Dhaniwala)
