The Indian stock market has demonstrated remarkable resilience and growth, particularly after the Trump tariff shock on April 2. While the announcement of the tariffs created immediate uncertainty across global markets, the subsequent 90-day pause in tariff implementation provided a much-needed relief. This relief was evident in the BSE 500 index, where 315 of the top 500 domestic stocks turned positive in the wake of the tariff jitters.
Market Performance: Indian Stocks Outperform Global Peers
Analysts have attributed this positive trend to multiple factors, including the reduced impact of the trade war, a decline in yields, and a limited rise in risk premiums, all of which helped support market valuations. As a result, Indian stocks have outperformed many global markets during this period. The total market capitalization of BSE 500 stocks surged by Rs 5.4 lakh crore, rising from Rs 3.67 lakh crore to Rs 3.73 lakh crore, accounting for 88% of the BSE’s market capitalization.
Leading Gainers in the Financial Sector
A significant portion of the gains in the market came from financial stocks, which analysts turned bullish on due to their domestic focus. Leading the pack were:
- Ujjivan Small Finance Bank: Up by 22.31%
- Home First Finance Company: Increased by 21.58%
- Equitas Small Finance Bank: Rose by 14.81%
- CreditAccess Grameen: Gained 14.68%
- IndusInd Bank: Saw a surge of 12.80%
Other Notable Gainers
Several other stocks also posted strong gains during this period, including:
- Archean Chemical Industries: +19%
- NBCC (India): +18%
- Gujarat Mineral Development Corporation: +17%
- JBM Auto: +16%
- Dixon Technologies (India): +14%
Additionally, stocks such as Star Health, Just Dial, Jyothy Labs, and Kaynes Technology showed an increase of over 10%.
Sector Performance: Domestic-Focused Sectors Lead
Investor interest has been predominantly in domestic-focused sectors, with telecom, consumer, financials, and cement stocks standing out as strong performers. These sectors have benefited from their domestic orientation, leading them to outperform the broader market. On the other hand, IT and metals sectors have seen underperformance in comparison.
India’s Market Outlook: Analysts Remain Optimistic
The BSE 500 index’s recent performance reflects a broader positive trend in India’s stock market. According to Morgan Stanley, improvements in the country’s macro balance, foreign exchange reserves, and the substantial structural inflows into domestic equity savings products suggest that the de-rating of Indian stocks from current levels is unlikely. While India remains expensive compared to emerging markets, the premiums have been compressed following underperformance in the previous quarter. Analysts foresee solid earnings growth from domestic-facing sectors, including financials, industrials, and consumer discretionary.
Stocks Underperforming: Wipro, Sonata, Tata Steel, and More
However, not all stocks have been able to ride the bullish wave. The following companies faced declines of 10-15% during the same period:
- Wipro Ltd
- Sonata Software Ltd
- Apar Industries Ltd
- Tata Steel Ltd
- Glenmark Pharmaceuticals Ltd
- National Aluminium Company Ltd
- Vedanta Ltd
- Indraprastha Gas Ltd
- KPIT Technologies Ltd
- TBO Tek Ltd
- Coforge Ltd
Despite these challenges, the overall market has demonstrated strong growth, driven by robust domestic sectors.
