The shares of export-oriented auto and pharma companies recorded significant gains on July 3 as markets remained optimistic around the possibility of India-US trade deal being announced soon.
The sharp rise in the auto stocks pushed the Nifty Auto index up 0.75 percent in the afternoon to hover around 24,065, extending gains for the third consecutive session. The Nifty Pharma index meanwhile rose 0.35 percent to stand at 22,188, extending gains for the 10th consecutive session.
India and US are on the verge of a breakthrough in their negotiations for a mini-trade deal, and an announcement could come as early as this weekend, people familiar with the matter told Moneycontrol.
"Last night, talks reached a juncture where a breakthrough is possible, therefore it is not an impossibility that the deal may be announced sometime this week," one of the sources said. India has stuck to its stance on sensitive sectors such as agriculture and dairy.
US President Donald Trump recently said that the trade deal with India will involve "much less tariffs". "I think we are going to have a deal with India. And that is going to be a different kind of a deal. It is going to be a deal where we are able to go in and compete,” Trump said. “Right now, India does not accept anybody in. I think India is going to do that, and if they do that, we are going to have a deal for much less tariffs,” he added.
US recently struck a trade deal with Vietnam. Trump said that imports from Vietnam will now face 20 percent tariff, with some facing even lower rates. US exports to Vietnam meanwhile will face zero tariffs. The capped 20 percent rate may have further boosted hopes for a positive outcome of US' trade deal with India.
Bosch shares were the top gainer among the auto stocks, jumping nearly 6 percent to trade at Rs 34,390 apiece. Hero MotoCorp and Maruti Suzuki shares gained over 1 percent each. Samvardhana Motherson and Mahindra & Mahindra (M&M) shares gained nearly 1 percent, while those of Tata Motors, Bajaj Auto, Exide Industries and MRF shares were trading in the green with marginal gains.
Natco Pharma shares were the top gainer on the pharma index, rallying over 5 percent to trade at Rs 969 apiece. Ajanta Pharma shares gained over 3.5 percent, while IPCA Labs shares rose nearly 3 percent. Biocon and Dr Reddy’s Laboratories shares were up nearly 2 percent. Cipla, Glenmark Pharma, Zydus Life, Sun Pharma and other pharma stocks were trading in the green with marginal gains.
US President Donald Trump had unveiled a slew of reciprocal tariffs on a number of countries in April this year, triggering a global trade war. He however later announced a 90-day pause to majority of the tariffs, which is set to expire this month.
Trump had said that nations must arrive at a deal with US in order to escape his tariffs which were set to take effect this July. India and the US have been negotiating a Bilateral Trade Agreement (BTA) before the critical July 9 deadline of the 90-day pause on tariff escalations lapses.
Also read: Our LIVE blog on stock market updates
Discover the latest Business News, Sensex, and Nifty updates. Obtain Personal Finance insights, tax queries, and expert opinions on Moneycontrol or download the Moneycontrol App to stay updated!
Find the best of Al News in one place, specially curated for you every weekend.
Stay on top of the latest tech trends and biggest startup news.
