Sensex soars 1,600 points as Indian stock markets rebound day after historic crash over Trump tariffs

Indian stock markets staged a strong recovery in early trade on Tuesday, rebounding from one of the steepest single-day losses in ten months. At 13.00 IST, Sensex was over 1,660 points up. Nifty was over 550 points up. The rally was supported by positive cues from Asian peers and widespread buying across sectors, according to data from both the BSE and NSE.

When trading began on Tuesday, the BSE Sensex jumped 1,283.75 points or 1.75 per cent to 74,421.65, while the NSE Nifty surged 415.95 points or 1.87 per cent to 22,577.55, recovering a large portion of Monday’s losses, as reported by PTI. This marked a sharp reversal from what Moneycontrol described as a “maniac Monday,” when both indices saw their most severe fall in nearly a year.

All 30 Sensex components, with the exception of Tata Consultancy Services, were trading in the green. Titan, Adani Ports, Bajaj Finserv, State Bank of India, Axis Bank, UltraTech Cement, Larsen & Toubro and Tata Steel led the gains, according to data reported by Moneycontrol.

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The recovery mirrored gains in Asian markets. As per PTI, Japan’s Nikkei 225 rallied over 5  per cent, while the Hang Seng (Hong Kong), Kospi (South Korea), and Shanghai Composite (China) also advanced after Monday’s sharp falls. The bounce in global indices helped lift investor sentiment domestically.

US markets, on the other hand, ended mostly lower on Monday, with the Nasdaq Composite edging up 0.10  per cent, while the S&P 500 and Dow Jones Industrial Average declined modestly, as reported by Moneycontrol.

The rebound also followed concerns around rising US-China trade tensions. According to a statement by VK Vijayakumar, Chief Investment Strategist at Geojit Financial Services, published by Moneycontrol, “Trump’s threat of another 50 % tariff on China will, if carried out, almost freeze Chinese exports to the US.” He added that while the tensions are serious, they are expected to remain largely confined to the US and China, as “others including the EU and Japan have opted for negotiations”, and India is already in talks for a bilateral trade agreement with the US.

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Meanwhile, India’s strong economic fundamentals helped underpin investor confidence. The Economic Survey for 2024–25, as cited by Moneycontrol, forecast GDP growth between 6.3 % and 6.8 % for the current fiscal year, despite global headwinds. A senior government official also told Moneycontrol that FY26 GDP growth could touch 6.5 per cent, supported by stable oil prices and resilient domestic demand.

On the institutional front, Foreign Institutional Investors (FIIs) offloaded equities worth Rs9,040.01 crore on Monday, while Domestic Institutional Investors (DIIs) purchased shares worth Rs12,122.45 crore, according to data provided by the stock exchanges and reported by PTI.

In the commodities market, Brent crude oil rose 1.32 per cent to $65.06 a barrel, offering some relief to energy-importing countries like India.

Despite Tuesday’s sharp gains, some analysts remain cautious. Anand James, Chief Market Strategist at Geojit Investments, told Moneycontrol that “after reclaiming 22,165, we are now eyeing 22,522 as the next target.” However, he warned that the India VIX had spiked nearly 70 per cent, indicating that market volatility may persist. He expects potential resistance near 22,660, with the Nifty likely to consolidate between 22,320 and 22,660 in the coming sessions.

Monday’s selloff had seen the Sensex crash by 2,226.79 points or 2.95 per cent to 73,137.90, with an intra-day low of 71,425.01, marking a 3,939.68-point plunge, PTI reported. The Nifty had fallen 742.85 points or 3.24 per cent to 22,161.60, after touching a low of 21,743.65, marking a 1,160.8-point drop intra-day.

While volatility remains a concern, the sharp rebound offered a measure of relief to investors still reeling from Monday’s bloodbath. As global markets recalibrate and domestic fundamentals remain firm, the coming sessions are expected to test the resilience of this recovery.