Nifty Nears Record High on Trade Deal Hopes
The Nifty 50 index is currently on an upward trajectory, approaching its record high, fueled by optimism surrounding a potential trade deal between India and the US, as well as improved corporate earnings. On October 29, 2025, the Nifty closed at 26,053, only 224 points shy of its peak of 26,277 reached in September 2024.
The buzz around the trade deal gained momentum after US President Donald Trump announced his commitment to negotiating a deal during the APEC CEO Summit in South Korea, expressing his respect for Prime Minister Narendra Modi. This positive sentiment has contributed significantly to market dynamics.
Market analysts suggest that the Nifty is likely to trade within a range of 25,600-26,300 as it heads into the upcoming November expiry, with the potential for movement beyond the previous high if trade talks progress favorably. Shrikant Chouhan from Kotak Securities believes that once the Nifty surpasses its September peak, it could see steady growth, especially if IT stocks join the rally.
The recent decision by the US Federal Reserve to cut its benchmark interest rate by 25 basis points has further bolstered market confidence. Chouhan notes that this rate cut, combined with easing bond yields and a stable rupee, creates a favorable environment for investors. Interestingly, after a prolonged period of net selling, foreign institutional investors have made a comeback, purchasing $2,385 million in October alone.
George Thomas, a fund manager at Quantum Mutual Fund, believes that the ongoing improvement in corporate earnings will sustain market momentum. Key sectors like banking and IT are showing signs of recovery, with credit growth picking up and the IT sector expected to rebound, particularly if the India-US trade deal materializes.
Alok Singh, Chief Investment Officer at Bank of India Mutual Fund, adds that a successful trade deal could lead to higher exports to the US. This would not only enhance capacity utilization but also attract new investments, addressing the current slowdown in private capital expenditure. The potential for US companies to diversify manufacturing bases from China to India aligns with the growing trend of the 'China plus one' strategy.
In summary, the Nifty 50's movement toward its record high is closely tied to international trade developments and domestic corporate performance, indicating a promising outlook for India's economy.
