Indian equities advanced across sectors as investors recalibrated export risk after the U.S. Supreme Court struck down key Trump tariffs, though fresh policy moves from Washington kept volatility risks alive.
Indian equities opened the week on a firm footing, with benchmark indices climbing in a broad-based rally after the Supreme Court of the United States struck down sweeping import levies imposed by President Donald Trump.
The Nifty 50 rose 0.64% to 25,733, while the BSE Sensex gained 0.62% to 83,333.08 as of 9:41 a.m. IST. Market breadth was decisively positive, with 15 of 16 major sectoral indices trading higher.
Register for Tekedia Mini-MBA edition 19 (Feb 9 – May 2, 2026).
Register for Tekedia AI in Business Masterclass.
Join Tekedia Capital Syndicate and co-invest in great global startups.
Register for Tekedia AI Lab.
Broader indices also advanced. The Nifty Smallcap 100 climbed 0.8%, and the Nifty Midcap 100 edged up 0.1%, indicating risk appetite beyond frontline blue chips.
Tariff Relief Drives Export Optimism
Friday’s ruling by the U.S. Supreme Court invalidated tariffs introduced under emergency powers, reshaping expectations for global trade flows. While Trump subsequently said he would raise a temporary tariff on U.S. imports from 10% to 15% under separate statutory authority, investors appeared to focus on the immediate easing of legal uncertainty surrounding the earlier levies.
“The development is a significant positive for export-oriented sectors, as the effective tariff burden eases,” said Sudeep Shah, head of technical and derivatives research at SBI Securities.
Textile stocks, highly sensitive to U.S. demand, led gains. Trident, Welspun Living, Arvind, and Kitex Garments rose between 2.5% and 8%, reflecting expectations of improved pricing competitiveness in the U.S. market.
India’s textile and apparel exporters are particularly exposed to shifts in U.S. tariff policy, given the scale of American consumer demand and competition from other Asian suppliers.
Despite the rally, investors remain alert to further policy adjustments from Washington. Trump’s weekend announcement that he would increase a temporary tariff to 15% underscores the fluidity of the trade landscape.
Shah cautioned that “any fresh statements or alternative tariff actions under different presidential authorities could reintroduce volatility in the near-term.”
The evolving U.S. position has also prompted strategic recalibration in New Delhi. India delayed plans to send a trade delegation to Washington, citing the need to assess the implications of the court ruling and subsequent tariff changes. The postponement highlights how rapidly shifting U.S. trade policy can disrupt bilateral negotiations and corporate planning.
Divergence in Financials and Pharma
Not all stocks participated in the rally.
IDFC First Bank plunged 15% after disclosing it was investigating a suspected $65 million fraud involving accounts of local government entities. The development raised governance and compliance concerns, dragging the lender sharply lower.
AU Small Finance Bank fell 6.6% after the Haryana government de-empanelled the bank for government business following disclosures of unauthorized and suspected fraudulent activities. The move threatens a revenue stream tied to public-sector transactions.
In pharmaceuticals, Cipla declined 2% after the U.S. Food and Drug Administration classified a unit of its supply partner, Pharmathen Internation in Greece, as “official action indicated” following an inspection. The designation suggests potential regulatory follow-up and may complicate supply chains for certain products.
However, the rally reflects more than a legal technicality. For Indian markets, U.S. tariff decisions feed directly into earnings projections for export-heavy sectors, including textiles, pharmaceuticals, auto components, and information technology services-linked manufacturing.
Relief from sweeping tariffs reduces downside risk to margins and order books, at least in the short term. However, the introduction of a revised 15% temporary tariff keeps a baseline layer of trade friction intact.
Currency dynamics will also be watched closely as a more predictable U.S. trade stance could stabilize capital flows into emerging markets, while abrupt policy shifts may renew volatility in the rupee and equity markets.
For now, investors appear to be pricing in the immediate positive signal from the court ruling, while bracing for additional announcements that could alter the calculus once again.
Overall, the session’s gains suggest confidence that the worst-case tariff scenario has been mitigated — but the durability of that optimism will depend on how the next chapter of U.S. trade policy unfolds.