India Stands Out as the Only Major Market to Rise After US Tariff Announcement

Ira Singh
Khabar Khabaron Ki,19 April’25

India has surprised many by becoming the only major stock market to rise since the US announced new tariffs on April 2. While most global markets have fallen, India’s Sensex and Nifty indices have gained 2.5% and 2.2% respectively in local currency terms. In US dollar terms, both are also up over 2%, according to official data.

This strong performance shows that India is standing apart at a time when global investors are nervous about trade tensions. While big markets in the US, Europe, and Asia have seen losses, India has not only recovered from the drop but moved even higher.

Since the April 2 tariff move, India’s benchmark indices—the Sensex and the Nifty—have posted gains of 2.5% and 2.2%, respectively, in local currency terms. When viewed in US dollar terms, both indices are up over 2%, making India the only large equity market to have fully recouped post-tariff losses and pushed beyond pre- announcement levels, according to official data.By contrast, global counterparts have struggled. The S&P 500 has declined 7%, the Dow Jones is down 6%, and European indices have seen similar drawdowns—France’s CAC losing 7.5%, Germany’s DAX slipping 5.4%, and the UK’s FTSE 100 falling 3.9%.The divergence is even more striking in Asia. China’s CSI 300 has dropped 3.9%, Hong Kong’s Hang Seng is down 7.8%, and Japan’s Nikkei has lost 3.8%. Other regional benchmarks—from Taiwan to the Philippines—have also posted negative returns, highlighting the scale of India’s divergence from the global trend.

One of the most notable factors behind this outperformance is India’s measured and constructive response to escalating trade tensions,believe experts. Rather than resorting to retaliatory tariffs or public sparring, India quietly advanced trade negotiations with the US. Strategic tariff reductions—on items such as high-end motorcycles, bourbon whiskey, and telecom equipment—helped soften the stance without compromising domestic interests.

This diplomatic restraint is being interpreted by markets as a signal of stability and maturity, especially at a time when global investors are actively seeking markets that can offer consistency amidst policy volatility.

Domestic Strength Supports Market Optimism
India’s equity strength is not just about external diplomacy. The domestic growth story remains intact and compelling. Unlike export-heavy economies, India’s consumption-driven economic model provides a cushion against external shocks, including global trade wars. As a result, India is less exposed to shifts in international trade flows, making it relatively insulated from tariff- induced slowdowns. Moreover, cooling crude oil prices have offered a double advantage—lower inflationary pressures and an improved current account balance. This has added to the confidence of foreign investors who see India as fundamentally better placed than many of its peers.

Meanwhile,early indicators of corporate earnings for the June quarter are also encouraging, with analysts forecasting 2–3% growth. The prospect of steady earnings, coupled with macro stability, has strengthened the case for continued equity inflows into Indian markets.

US Remains Top Trading Partner; China Gap Widens
The recent trade data shows that the US continues to be India’s top trading partner for the fourth straight year in FY25. This steady relationship has played an important role in supporting investor confidence.At the same time, the trade gap with China has widened to $99.2 billion. While imports from China continue to rise, exports have remained almost flat. This contrast has also influenced India’s push to diversify trade and attract more business from the US and other partners.

A New Global View of India
India’s recent performance is more than just a market rally—it reflects changing views worldwide. Investors now see India as a stable and promising place to invest, especially when other economies are facing uncertainty.

With a focus on long-term policies, economic discipline, and strong domestic demand, India is creating its own path. Even as global markets struggle, India’s steady rise has made it a standout destination for investment in today’s challenging world.

Key Takeaways:
• India is the only major market to post gains since the April 2 US tariff move.
• Sensex and Nifty are up 2.5% and 2.2% in rupee terms; over 2% in USD terms.
• Global markets like the S&P 500, DAX, CAC, Nikkei, and Hang Seng have all declined.
• India avoided confrontation, focused on trade talks, and lowered some tariffs on US goods.
• Strong domestic consumption and falling oil prices have supported the economy.
• Corporate earnings outlook and stable US-India trade ties further boost confidence.
• India’s performance reflects a growing image as a reliable and stable investment destination.