Nifty Set To Open With Massive Gap-Up As GIFT Nifty Surges 600 Points On India-US Trade Deal

New Delhi: The Indian equity markets are set for a big opening on Tuesday, as a historic trade agreement between the world's two largest democracies, India and the US, stirs optimism across global financial circles. The landmark announcement, made by US President Donald Trump on his Truth Social platform, has catapulted the Nifty futures, or GIFT Nifty, to a massive 600-point gain in overnight trade, setting the stage for a possible explosive start to the trading session.

The sweeping trade deal, forged after a phone conversation between Donald Trump and Prime Minister Narendra Modi, slashed US tariffs on Indian goods from 25% to 18%, effective immediately. The move is expected to provide big margin relief to Indian exporters, particularly in sectors like IT and textiles, which have been reeling under the weight of previous trade barriers.

As Trump took to Truth Social to share the news, he praised PM Modi as "one of my greatest friends" and a "Powerful and Respected Leader of his Country (India)". The US President also revealed the commitment from India to "stop buying Russian Oil, and to buy much more from the United States and, potentially, Venezuela", which he believes will help “END THE WAR in Ukraine”.

According to information shared by Trump, the trade agreement is not limited to only tariff reductions, but it also includes India's commitment to reduce its tariffs and non-tariff barriers against US goods to zero. Furthermore, India has pledged to "BUY AMERICAN" at a much higher level, with a staggering $500 billion commitment to US energy, technology, agricultural, coal, and other products.

Market Expectations and Sectoral Impact

Given the current GIFT Nifty trajectory, the NSE Nifty 50 is expected to open with a massive gap-up, testing the 25,600-25,700 range in early trade. Export-oriented sectors, particularly IT and textiles, are set to lead the charge, benefiting from the reduced US tariffs. Energy and OMCs are also likely to witness big movement, driven by India's shift away from Russian oil and towards US energy giants.

The banking and financial sectors are expected to provide crucial support to the Nifty, with heavyweights like HDFC Bank and ICICI Bank likely to keep the index above the 25,500 psychological mark. As Trump tweeted, "Our amazing relationship with India will be even stronger going forward. PM Modi and I are two people that GET THINGS DONE", effectively dispelling the cautious "wait-and-watch" sentiment that had gripped Dalal Street.

Monday's Recovery Sets The Stage For Tuesday

The Indian markets had already shown remarkable resilience on Monday, with the Nifty 50 climbing 262 points (1.06%) to close at 25,088.40, while the Sensex jumped 943 points to finish at 81,666.52. The recovery signaled that the market was ready to look past domestic tax tweaks and focus on larger global growth drivers.

However, just 48 hours ago, the mood was starkly different, with the Indian markets suffering a post-Budget 2026 crash following Finance Minister Nirmala Sitharaman's proposal to hike the Securities Transaction Tax (STT) in F&O trading. The hike, raising STT on Futures from 0.02% to 0.05% and on Options from 0.10% to 0.15%, had initially triggered a wave of panic selling in the derivatives segment, causing the Nifty to tumble nearly 500 points in a single session.