SENSEX rises over 500 points, NIFTY reclaims 23,250; here are factors driving market rally

The Indian equity benchmarks edged higher on Wednesday, April 2, ahead of 'Liberation Day' tariff announcement by the US President Donald Trump. The SENSEX rose as much as 542 points to hit an intraday high of 76,567.02 while the National Stock Exchange benchmark NIFTY50 index touched an intraday high of 23,311.90. As of 12:01 pm, the SENSEX was up 419 points at 76,443 and NIFTY50 index advanced 120 points to 23,285.

Trump's softer stance on tariffs

Expectations of softer stance on tariffs led to buying interest in Wednesday's session. As per a report by The Washington Post, most goods imported to the United States are likely to attract 20% tariff rather than a more targeted approach which was also considered earlier. President Trump is expected to announce tariff plan at Rose Garden in White House at 4:00 pm eastern time on Wednesday (1:30 am IST).

Following this development, most of the Asian markets ended marginally higher ahead of the tariff decision. Japan's Nikkei rose 0.28%, Australia's S&P/ASX200 gained 0.12% and Hong Kong's Hang Seng was up 0.1%.

Markets in Europe, however, opened marginally lower with Germany's DAX declining 0.22%, French CAC40 index down 0.4% and England's FTSE100 index falling 0.31%.

India’s manufacturing PMI rises in March

India's strong factory output as measured by the manufacturing PMI rose to 58.2 from 56.3 in February, data compiled by S&P Global showed.

Value buying after sharp fall

Analysts say that value buying at lower levels after yesterday's massive fall is also adding to the positive sentiment among market participants. All the major sector gauges compiled by the National Stock Exchange were trading higher led by the NIFTY Realty index's nearly 3% gain. NIFTY Consumer Durables, Auto, Bank, Financial Services and IT indices also rose between 0.5-1.5% each.

Decline in India VIX, also known as the fear index, further supported the positive sentiment. The India VIX was down 0.85%.

Heavyweights like HDFC Bank, Infosys, ICICI Bank, Bharti Airtel and Titan were among the top movers in the SENSEX. Up move in these shares alone added over 350 points towards gain in the SENSEX, data from the stock exchange showed.

NIFTY50 gainers and losers

Tata Consumer Products was top gainer in the NIFTY50 basket of shares, the stock rose 7% to ₹1,064.60 after analysts at Goldman Sachs are bullish on the stock. They said in its report that Tata Consumer Products is poised for strong earnings per share (EPS) growth over FY25-27.

IndusInd Bank, Zomato, Titan, and Tech Mahindra were also among the gainers.

On the flipside, Bharat Electronics was top NIFTY50 loser, the stock declined 4% to ₹281 after it missed order inflow guidance for the current financial year.

Nestle India declined 1.5% after analysts at Bank of America Merrill Lynch said that Nestle’s valuations are high considering its growth outlook.

Hindalco, Ultratech Cement, Dr Reddy's Labs and NTPC were also among the losers.