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Sensex, Nifty Today: The India–US trade deal has shifted market mood at a time when Indian equities were lagging global peers. The agreement could help revive foreign flows, ease currency pressure and trigger a broader re-rating in beaten-down sectors.

Speaking With Zee Business Managing Editor Anil Singhvi, market veteran Gurmeet Chadha, CIO and managing partner at Complete Circle Wealth, said the rally seen so far should be seen as the beginning, not the end.

Chadha said markets often make a large part of annual returns in just a few sessions. Those days need conviction and optimism. In his view, the current move looks sharp only because India has underperformed global markets for months. “A bigger part of the move is still left,” he said.

Chadha called the deal a clear sentiment booster. He said several beaten-down sectors could see re-rating. These include textiles, chemicals, IT and engineering goods. He added that some tariff-related details, especially for steel, aluminium and auto parts, still need clarity, but the overall impact remains positive.

From a flows perspective, he said India had seen sustained outflows and currency pressure despite stable macro indicators. The trade deal could help bridge this gap and bring capital markets back in line with the macro picture.

Chadha said India’s weighted average cost of capital is still close to 7 per cent, well above the 4–5 per cent seen in many western economies. To move from a 4 trillion dollar economy to a 10 trillion dollar one, this gap must narrow. Staying integrated with large global economies is key. He said the trade deal can act as an important catalyst on this front.

On whether Budget-day lows have formed a durable base, Chadha said certainty is never possible. But the probability of those levels holding looks higher. He noted that nearly 55 per cent of BSE 500 stocks are trading near Covid-era valuations. Market breadth, he said, has been far weaker than headline indices suggest and should now improve.

He pointed to sharp moves in textile stocks and said similar improvement could be seen in banks, financial services, auto ancillaries and defence over time. Defence exports, in particular, remain a largely untapped opportunity.

Chadha advised investors to increase equity allocation by 10–15 per cent if they are underweight. He suggested adding 4–5 per cent immediately and the rest in a staggered manner. He cautioned against chasing pure momentum. Stock selection should focus on strong balance sheets, improving earnings and clear benefits from the trade deal.

His preferred areas include banking and financial services, selective textiles and chemicals, defence, auto ancillaries and capital goods. Earnings momentum, he said, will be the final trigger that decides whether current levels sustain.