Ahmedabad/Surat, Feb 3 (NationPress) The Indian stock market experienced a remarkable surge on Tuesday following the announcement of a trade agreement between India and the United States, which significantly reduced tariffs on Indian exports.

The agreement, reached after negotiations between Prime Minister Modi and US President Trump, has slashed tariffs from 50% to 18%, putting an end to months of uncertainty that affected investor confidence.

This tariff reduction has notably impacted critical sectors, especially textiles. In Surat, textile stocks surged dramatically, showcasing the renewed optimism among investors and analysts.

Experts assert that this market rally is a direct consequence of the trade agreement, which had been pending for eight months.

The long-awaited resolution has alleviated market uncertainties, prompting positive reactions from stakeholders.

Danish Golwala, managing director of Shri Nivesh Share Market, commented on the broader context of recent market fluctuations.

“In the budget presented on Sunday, the government raised the Securities Transaction Tax (STT) on futures and options. Consequently, the market reacted negatively, plummeting sharply as there was no expectation for anything related to equity markets in the budget. Instead, there was hope for relief in long-term capital gains tax, such as increasing the limit from Rs 1.25 lakh to Rs 2 lakh. This hope was unmet, and the increase in STT caused a significant market dip,” he explained.

Golwala further stated that the new trade deal between India and the US has positively transformed the market outlook. “The tariff rate has been reduced from 50% to 18%, which has spurred very positive market reactions today,” he remarked.

In Ahmedabad, stock market expert Dipen Dudhiya emphasized that the tariff reduction has opened up new investment avenues. “This is an opportune moment to invest in the stock market, with potential growth projections of up to 15% for the SENSEX and NIFTY,” he stated.

Dudhiya also mentioned that foreign investors are returning, attracted to promising sectors such as energy, textiles, solar panels, banking, and auto insurance.

He highlighted that mid-cap and small-cap stocks are now considered attractive investment options.

Stock market analyst Nimesh Palsanawala attributed the market rally to the tariff reductions and emphasized the relationship between stable governance and investor confidence.

“Stable governance enables firm policy decisions, which enhances investor confidence and encourages further investment,” he noted.

The lowering of tariffs and the resolution of the long-pending trade deal between India and the United States are widely recognized as pivotal factors in restoring investor optimism across multiple sectors, thereby enhancing growth prospects for the Indian equity market.