Indian stocks surge as ceasefire and US-China trade deal boost investor confidence

Indian stocks soared nearly 4% on Monday, marking their best single-day rally in years, as investors cheered a ceasefire agreement between India and Pakistan alongside a landmark trade deal between the United States and China.

The benchmark BSE-100 index jumped 3.85%, or 962.57 points, to close at 25,976.50, driven by optimism over geopolitical stability and improved global trade conditions.

India and Pakistan reached a truce after four days of missile and drone strikes targeting military sites, easing tensions in the region. The unexpected breakthrough helped bolster investor confidence and lifted broader market sentiment.

However, pharmaceutical stocks lagged behind, slipping 1.3% after U.S. President Donald Trump signed an executive order aimed at cutting prescription drug prices. The policy shift raises concerns for Indian drugmakers, who rely heavily on North American revenue.

Market analysts noted that while Monday’s surge was fueled by positive global and regional developments, investors remain cautious over potential policy shifts and economic implications in the coming weeks.