Market Stages Strong Comeback Ahead of US Tariff Decision

After two consecutive days of declines, the Indian stock market demonstrated significant resilience on Wednesday, April 2nd. Both the Sensex and Nifty indices posted strong gains, driven primarily by a solid rebound in banking and information technology (IT) stocks. This positive momentum occurred just hours before a key deadline related to US tariffs announced by President Donald Trump, which the White House confirmed would take immediate effect.

Broad Market Gains

The day concluded with BSE Sensex registering a gain of 592.93 points, or 0.78%, closing firmly at 76,617.44. The NSE Nifty 50 mirrored this positive sentiment, rising 166.65 points, or 0.72%, to finish above the 23,300 mark at 23,332.35. Market breadth was decidedly positive, indicating widespread buying interest, with approximately 2,755 shares advancing compared to 1,048 declining.

The upbeat mood extended to the broader market segments as well. The Nifty Midcap 100 index climbed a notable 1.61%, while the Nifty Smallcap 100 index gained 1.2%. However, despite this rally, analysts continue to advise caution regarding valuations in these segments, noting that recent corrections (9% for midcaps, 14% for smallcaps) may not have fully mitigated potential downside risks associated with elevated price levels.

Sectoral Strength Shines Through

Encouragingly, strength was visible across the board, with all 13 major sectoral indices ending the day with gains. The Nifty FMCG, Bank, IT, and Auto sectors were among the top performers, each rising by up to 1%. Key contributions came from heavyweight banking stocks like HDFC Bank, ICICI Bank, and SBI. Other sectors including Infrastructure, Metal, Pharma, and PSU Banks also participated in the rally, posting gains of around 0.5% each. Even the Nifty Oil and Gas index, which had been slightly down earlier in the session, managed to recover and close 0.2% higher.

Spotlight on Key Stocks

Several individual stocks made notable moves:

• Tata Consumer Products: This stock was a standout performer, surging over 7%. The rally followed an upgrade from global brokerage Goldman Sachs, which changed its rating to 'Buy' from 'Neutral' and increased its price target. Goldman Sachs cited expectations of robust earnings per share (EPS) growth for the company between FY25-FY27 and an anticipated recovery in tea margins driven by price hikes.
• Vishal Mega Mart: Shares climbed over 6.5%, boosted by positive business updates from peer retailers for the March quarter. Competitor V-Mart Retail, for instance, reported strong revenue growth (17%) and same-store sales growth (8%), along with significant store expansion, which lifted sentiment for the sector.
• TVS Motor Company: The two-wheeler manufacturer gained as much as 3% after reporting its best-ever annual sales figures for the financial year 2024-25, reaching 4.74 million units (a 13% year-on-year increase). Sales momentum remained strong in March 2025, with a 17% year-on-year rise.

The market demonstrated considerable strength on Wednesday, shaking off the previous two days' losses with a broad-based rally ahead of US tariff news. Strong performances in banking and IT, coupled with positive company-specific developments, fueled the gains across all sectors. However, underlying concerns about market valuations persist suggesting investors may continue to navigate with a degree of caution.