It’s a morning like none today. The Indian markets are in a celebration mode after the US President Donald Trump announced the trade deal with India. Market experts and brokerage firms have given a big thumbs up to the deal. Now that the deal is confirmed by both US President Donald Trump and Indian Prime Minister Narendra Modi, International brokerage firm Jefferies expects the deal to remove one of the biggest overhangs for global investors, who have remained cautious on India amid trade uncertainty and a weak rupee.
Although official details are still awaited Jefferies said it believes most agricultural products are likely excluded from the agreement. Important to note, US demanding market access to its Agriculture sector was one of the roadblock. Jefferies expects the agreement to end months of uncertainty for markets, lift sentiment, boost foreign investor confidence and improve the outlook for the rupee.
Under the deal, tariffs on Indian exports to the US have been reduced sharply to 18% from an earlier 50%. Tariffs on US exports to India have been cut to zero.
#1. Labour-intensive exports get tariff advantage over peers
Jefferies noted that stock and sectors in exposure of India-US trade is expected to positively affected.
Labour-intensive exports such as textiles, leather, gems and jewellery are experted to have some good news as the new 18% tariff is 1–2 percentage points lower than key competitors like Pakistan and Vietnam.
#2. Autos, chemicals, solar manufacturing stocks to benefit: Jefferies
Other sectors like auto components, chemicals, solar manufacturing, which has high exposure to the US market is also expected to benefit from the agreement.
Jefferies noted that Stocks such as Sona BLW, Bharat Forge, Navin Fluorine, PI Industries, SRF, Waaree Energies, Premier Energies, Emmvee and Welspun Living are seen as potential beneficiaries. Adani Group companies could also gain from improved trade and sentiment conditions.
However, Jefferies cautioned that if imported oil or gas from the US turns out to be more expensive, it could negatively impact oil marketing companies.
#3. Jefferies sees Indian Rupee strengthening
Jefferies believes the INR outlook could also strengthen in the near term after the deal, potentially acting as a positive trigger for FPI inflows.
FPIs have withdrawn about US$34 billion from Indian equities over the past 16 months.
#4. Positive trigger for FII flows
Jefferies noted that one of the reason of negative sentiment of FPI was a weak Indian Rupee, and the absence of a trade deal with the US. Jefferies noted that one of the key concerns should get now addressed.
As India has also recently signed free trade agreements with the EU, UK and others along with the US, India’s largest goods export market.
The US accounted for $87.4 billion or 18% of total exports of India in 2024. However, India’s exports to the US were flat year-on-year (YoY) during Sep–Dec 2025 after 50% tariffs were imposed. Jefferies expects this drag to ease now.