Sensex Surges on India-EU FTA Optimism

Indian stock indices saw a significant rise on Wednesday as optimism grew following the finalization of the India-EU Free Trade Agreement. Sensex and Nifty closed higher, driven by gains in sectors like media, metal, and energy. Despite global market uncertainties, Indian markets remained buoyant.

On Wednesday, Indian stock indices achieved notable gains, spurred by optimism surrounding the newly finalized India-EU Free Trade Agreement. At closing, the Sensex rose by 487.20 points, marking a 0.60% increase to settle at 82,344.68, while the Nifty climbed 167.35 points, a 0.66% rise, closing at 25,342.75.

Sectors such as media, metal, energy, oil and gas, realty, and PSU banks were among the top performers, while FMCG, consumer durables, and pharma experienced declines. The Indian rupee weakened slightly, ending at 91.79 per dollar from a previous close of 91.72.

With the India-European Union Free Trade Agreement concluded on Tuesday, Vinod Nair, Head of Research at Geojit Investments Limited, stated that domestic markets displayed sustained optimism, largely fueled by the India-EU FTA. Broader indices outperformed, led by strengths in metals, financials, and oil & gas sectors, as FMCG stocks encountered profit-taking. Global markets presented a mixed picture, with investors awaiting the U.S. Federal Reserve's policy announcement.

Despite widespread expectations of stable rates, attention focused on the Fed Chair's hints at potential rate cuts later this year. Rising U.S.-Iran tensions and global tariff uncertainties remain a concern, potentially tempering overall market sentiment. Ponmudi R, CEO of Enrich Money, noted that improved global cues and renewed external trade optimism contributed to a positive end to the session. The improved risk landscape encouraged some bottom-fishing at oversold levels, complemented by modest short-covering in derivatives.

Selective buying in export-oriented and manufacturing stocks suggested expectations of enhanced external demand and better trade links. Although the rupee stayed within a narrow range against the U.S. dollar, it found support from a weaker dollar climate but faced limitations due to month-end demand and cautious foreign fund flows, according to Ponmudi. (ANI)

(With inputs from agencies.)