Sensex, Nifty surge to record highs with biggest gains in absolute terms

markets

• Sensex and Nifty hit record highs after US–India trade deal announcement
• Indices saw record gains: Sensex +4200 points, Nifty +1250 points.
• Experts advise caution, suggesting investors wait for better entry points

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India’s benchmark Sensex and Nifty opened at record highs, registering their biggest single-day gains in absolute terms after Prime Minister Narendra Modi and US President Donald Trump announced a US–India trade deal. Under the agreement, the tariff rate was reduced to 18 percent, marginally lower than the rates applicable to Bangladesh and Pakistan.

The rally marked the biggest single-day gain in absolute terms for the Indian equity benchmarks, with the Sensex opening higher by about 4200 points and the Nifty gaining nearly 1250 points. Both indices jumped more than 5 percent, marking their sharpest gains since April 7, 2020.

Earlier, the second-largest single-day gain in absolute terms was recorded on May 12, 2025, when the Sensex and Nifty surged over 2975 points and 920 points, respectively, after geopolitical tensions between India and Pakistan eased, with both sides agreeing to avoid further escalation.

The third-biggest gain came on June 3, 2024, when the benchmarks jumped more than 2500 points and 710 points, respectively, after exit polls predicted a massive victory for the BJP-led NDA in the Lok Sabha elections. The fourth-largest gain was seen on April 7, 2020, when the Sensex and Nifty rose over 2475 points and 710 points, respectively, amid a sharp rally during the Covid-19 period.

Experts said that as US markets correct and emerging markets stabilise, foreign capital is likely to gradually shift back to India. They noted that such flows do not return overnight, but a positive turn in sentiment is an important first step.

They added that many global investors operate based on “perceived risk,” staying on the sidelines when uncertainty is high. With the trade-related overhang now easing, the perceived risk premium for India is expected to decline.

At the same time, experts cautioned against chasing the rally aggressively. They described the move as a sentiment-changing event rather than a “buy-anything-at-any-price” moment. Markets, they said, had reached a stage where participation had thinned and buying momentum was missing. With sentiment improving, activity and participation are expected to pick up, which is positive, but investors may be better served waiting for more attractive entry points rather than rushing in at the open.

Broader markets also rallied sharply, with the BSE MidCap 150 index surging 4.6 percent, or 721 points, while the BSE Smallcap 250 index gained 4.3 percent, or 261 points.