Sensex and Nifty open higher on foreign inflows and India–US trade optimism

Benchmark equity indices opened firmly higher on Monday, supported by foreign fund inflows, a rally across Asian markets and optimism following a fresh interim trade agreement between India and the United States.

In early trade, the 30-share BSE Sensex rose 441.77 points, or 0.53 per cent, to 84,022.17, while the NSE Nifty gained 129 points, or 0.50 per cent, to 25,822.70.

Buying interest was seen in several heavyweights, with State Bank of India, Titan, Kotak Mahindra Bank, Bharat Electronics, Tata Steel, Sun Pharmaceuticals, Larsen & Toubro, Adani Ports, IndiGo, Reliance Industries and Bharti Airtel among the top gainers on the Sensex.

However, some stocks traded lower, including Power Grid, ITC, Hindustan Unilever, Bajaj Finance, Trent, Infosys, ICICI Bank, Axis Bank, NTPC, Tech Mahindra, Tata Consultancy Services and HDFC Bank.

Market sentiment was further bolstered by sustained foreign institutional investor (FII) participation. FIIs purchased equities worth Rs 1,950.77 crore on Friday, according to exchange data.

VK Vijayakumar, chief investment strategist at Geojit Investments, said a key positive for the market was the recent shift in FII behaviour. “Foreign investors, who were persistent sellers earlier, have turned buyers in the cash market in three of the last four sessions. With the derivatives segment still heavily net short, expectations of short covering could lend resilience to the market,” he said.

He added that the recent “Anthropic shock” is likely to continue weighing on information technology stocks, while banking shares may gain momentum on signs of improving credit growth. Stronger credit expansion, he noted, could support GDP growth and corporate earnings in FY27.

Asian markets also traded higher, with Japan’s Nikkei 225, South Korea’s Kospi, China’s Shanghai Composite and Hong Kong’s Hang Seng all in positive territory.

Devarsh Vakil, head of prime research at HDFC Securities, said Japanese equities hit record highs after the ruling Liberal Democratic Party, led by Sanae Takaichi, secured a decisive victory. He added that Indian markets could benefit as Japanese capital increasingly pivots away from China under Takaichi’s “economic security” agenda, potentially directing significant foreign direct investment into India’s infrastructure and technology sectors.

Vakil also highlighted the India–US interim trade agreement announced on Saturday, which brings an end to a ten-month tariff standoff. Under the deal, the US will cut tariffs on Indian goods from 50 per cent to 18 per cent, while India has safeguarded sensitive sectors such as dairy and committed to buying USD 500 billion worth of US goods over five years, particularly in energy, aviation and defence technology.

He noted that the agreement also integrates India into US-led initiatives on critical minerals and artificial intelligence supply chains, strengthening its strategic position in the Indo-Pacific region.

Overnight, US markets ended more than 2 per cent higher, adding to the positive global cues. Meanwhile, Brent crude, the global oil benchmark, slipped 0.94 per cent to USD 67.41 a barrel.

On Friday, domestic markets had already closed higher, with the Sensex gaining 266.47 points to end at 83,580.40 and the Nifty rising 50.90 points to settle at 25,693.70.

With PTI inputs