India stands tall as global markets falter since Trump’s April 2 tariff shock

Experts say that a major factor supporting sentiment is the market’s growing anticipation of a bilateral trade agreement between the US and India.

Three weeks since US President Donald Trump’s "Liberation Day" tariffs on April 2, India has emerged as the lone bright spot in the global equity landscape. While markets across continents have crumbled under the weight of escalating trade tensions, the Sensex and Nifty have bucked the trend, rising 3.6 percent and 3.4 percent in local currency terms. In dollar terms, they’re up 4.0 percent and 3.8 percent—making India the only major economy to deliver positive returns in both gauges.

In contrast, US indices have taken a hit. The Dow Jones has dropped 9.6 percent, while the S&P 500 is down 9 percent. Losses across Europe are equally grim: Germany’s DAX is down 5.3 percent, France’s CAC has slipped 7.3 percent, and the UK’s FTSE 100 has fallen 3.9 percent, Bloomberg data showed.

Asian markets haven’t fared any better. Japan’s Nikkei has declined 3.8 percent in local terms but managed a modest 1.5 percent gain in USD terms, thanks to currency moves. China’s CSI 300 is down 2.8 percent locally and 3.6 percent in dollar terms, while the Hang Seng has plunged 7.8 percent. Taiwan’s stock exchange is the worst performer globally, falling 10.7 percent in local currency and 8.9 percent in USD.

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South Korea’s Kospi is down 0.6 percent but has eked out a 2.0 percent gain in USD terms. Brazil’s Ibovespa has fallen 1.2 percent locally and 3.1 percent in dollar terms. Other Southeast Asian markets have also turned red—Jakarta is down 0.7 percent in local currency and 2.3 percent in USD, the Philippines has slipped 1.9 percent and 1.3 percent respectively, and New Zealand’s NZX 50 Index is down 2.5 percent in local terms but up 2.1 percent in USD.

Against this backdrop, India’s resilience is remarkable.

Experts say that a major factor supporting sentiment is the market’s growing anticipation of a bilateral trade agreement between the US and India. India never went down the road of confrontation. No reciprocal tariffs, no public criticism, instead, India has been ahead in talks and could be among the first nations with which the US signs a trade pact.

Unlike neighbouring China, which slapped retaliatory tariffs against the US, India’s early moves to reduce tariffs on US goods—cutting duties on premium motorcycles, bourbon, and telecom equipment—have signalled diplomatic agreements. At the same time, a declining dollar, which hit a 3-year low, has the potential to attract more FPI inflows into India in the short run. Furthermore, a dip in crude oil prices has provided an additional boost by lowering inflationary pressure and improving the trade deficit.

The ongoing Q4 earnings season has also played a key role in lifting sentiment. Major banks like HDFC Bank and ICICI Bank have reported steady numbers, setting a positive tone for the rest of the season. Investors are now hopeful of a reasonably strong showing from India Inc. Supporting this optimism is the new RBI Governor, Sanjay Malhotra, whose early steps to ease system-wide liquidity have provided timely support to the market, especially amid global slowdown concerns and tariff-related uncertainty.

Importantly, India’s consumption-driven economy is seen as relatively immune to the fallout from global trade tensions, a factor that’s helping it stay afloat while export-heavy peers could face heat.

At about 2:20 pm, Indian benchmark indices were up for a sixth consecutive trading session. The Sensex was up 195.71 points or 0.25 percent at 79,604.21, and the Nifty was up 53.35 points or 0.22 percent at 24,178.90. About 2,333 shares advanced, 1136 shares declined, and 107 shares remained unchanged.