The Indian stock market commenced the holiday-shortened trading week on an optimistic footing, with investor sentiment receiving a significant uplift from the finalization of a landmark free trade agreement between India and the European Union. Additional positive momentum stemmed from growing expectations that the United States might consider lifting tariffs associated with India's purchases of Russian oil, providing a near-term boost to market confidence.
Key Indices and Sectoral Performance
Reflecting this improved sentiment, the benchmark indices posted solid gains. The Nifty 50 index advanced by 0.51 percent to settle at the 25,175 level, while the S&P BSE Sensex climbed 0.66 percent to close at 82,077 points. The broader market indices mirrored this upward trajectory, with both the Nifty Midcap 100 and the Nifty Smallcap 100 indices registering gains exceeding 0.40 percent each.
Sectoral Winners and Losers
Sectoral performance was notably mixed. On the winning side, the Nifty Metal index emerged as the top performer, rallying impressively by 3.07 percent. It was followed by strong showings from the Nifty PSU Bank, Nifty IT, Nifty Oil and Gas, and Nifty Realty indices, which surged between 0.46 percent and 1.8 percent.
Conversely, the Nifty Auto index stood out as the worst performer, declining by 0.93 percent. This downturn was primarily driven by investor concerns over intensifying competition following a sharp reduction in import taxes on European-made cars. The Indian government is reportedly slashing tariffs on cars to 10 percent over a five-year period from rates as high as 110 percent, with an annual quota of 250,000 vehicles. The Nifty FMCG and Nifty Consumer Durables indices also shed 0.60 percent each.
Historic Trade Deal and Market Access
The positive market undertone was heavily influenced by the conclusion of what Prime Minister Narendra Modi termed India's biggest free trade agreement in history with the European Union. Following summit talks with EU leaders Ursula von der Leyen and Antonio Costa, the deal promises transformative access.
Commerce and Industry Minister Piyush Goyal highlighted that India would secure "unprecedented" market access at concessional duties for over 99 percent of its exports by value into the EU market. This development is expected to provide a substantial boost to various domestic labour-intensive sectors.
Stock-Specific Movements
Several individual stocks witnessed sharp movements driven by corporate earnings and sectoral trends.
Notable Gainers
- Home First Finance led the gainers' list, soaring 12.5 percent after reporting strong December quarter (Q3) performance.
- Karur Vysya Bank shares jumped 10.2 percent, also reacting positively to its Q3 numbers.
- Axis Bank shares settled 4.6 percent higher at ₹1,333.20 apiece following its Q3 results.
- Hindustan Copper shares surged 5 percent to ₹563.60, witnessing renewed buying after a two-day sell-off. Other metal stocks like NMDC Steel, JSW Steel, SAIL, Hindustan Zinc, NALCO, Vedanta, and APL Apollo Tubes also rallied up to 4.8 percent.
- Other significant gainers included Aegis Vopak Terminal, Jindal Stainless, Sona BLW Precision, Garden Reach Shipbuilders, KPR Mill, Data Patterns, India Cements, Asahi India Glass, Craftsman Automation, Triveni Engineering, and Adani Enterprises, which closed higher between 5 percent and 9.5 percent.
Overall, 50 stocks from the Nifty 500 pack ended the trading session with gains exceeding 3 percent.
Notable Losers
- OneSource Specialty Pharma was the top laggard, crashing 20 percent to hit a new 52-week low of ₹1,151.30. The sell-off deepened post its December quarter results, marking the stock's seventh consecutive day of losses and a cumulative decline of 35 percent.
- SBFC Finance and Syngene International were other major losers, plunging 11.7 percent and 10 percent, respectively.
- JSW Energy shares extended losses for a second session, dropping another 8 percent to ₹440 apiece, its lowest level since May 2025.
- Auto majors Mahindra & Mahindra, Hyundai Motor India, and Force Motors fell by 4.2 percent, 4 percent, and 3 percent, respectively.
- Other declining stocks included Gravita India, Godrej Consumer Products, Nuvama Wealth Management, Reliance Infrastructure, Poly Medicure, Valor Estate, Mahanagar Gas, and Zensar Technologies, which fell between 4 percent and 6 percent.
Disclaimer: We advise investors to check with certified experts before making any investment decisions.
