Indian shares set for gap-up open after US trade deal

Feb 3 (Reuters) - Indian equity benchmarks are likely to open higher on Tuesday, buoyed by the India–U.S. trade deal, which is expected to attract foreign investor inflows.

Gift Nifty futures GIFc1 were trading at 25,920 points, as of 6:51 a.m. IST, indicating the benchmark Nifty 50 index .NSEI will open about 3% above Monday's close of 25,088.4.

U.S. President Donald Trump on Monday announced a trade deal with India that slashes U.S. tariffs on Indian goods to 18% from 50% in exchange of India halting Russian oil purchases and lowering trade barriers.

The key tail risk of India's geopolitical isolation about which investors were concerned has now been adequately addressed by the back-to-back deals with EU and U.S., Citi Research said in a note.

Analysts expect the overhang on Indian markets in terms of foreign outflows to get lifted after the trade deal with the U.S.

Foreign portfolio investors (FPI) have offloaded shares worth $23 billion since the start of 2025, triggering a rare underperformance over Asian and emerging market peers.

"As risk premia normalise, India once again looks investable to global capital — a high-growth, politically aligned, strategically important economy with deep domestic demand and improving external linkages to both the US and Europe," said Sujan Hajra, chief economist and executive director, Anand Rathi Group.