Indian Jewellery Stocks Experience Significant Rally Following India-US Trade Agreement
In a remarkable market development, prominent Indian jewellery stocks demonstrated substantial upward momentum on Tuesday, February 5, 2026, with gains reaching up to 5% in intra-day trading. This surge occurred immediately following the official announcement of a comprehensive trade agreement between India and the United States, marking a significant milestone in bilateral economic relations.
Market Performance of Key Jewellery Players
The stock market witnessed enthusiastic investor response to major jewellery companies, with industry leaders showing impressive performance. Titan Company Limited, one of India's largest jewellery retailers, experienced notable buying interest throughout the trading session. Similarly, Kalyan Jewellers, a prominent national chain with extensive retail presence, recorded substantial gains that reflected market optimism.
Adding to this positive trend, Senco Gold Limited, another significant player in the Indian jewellery sector, joined the upward movement with comparable percentage increases. This collective rally across multiple jewellery stocks indicates broad-based market confidence in the sector's prospects following the trade development.
Details of the India-US Trade Agreement
The market movement was directly triggered by the formal announcement of a trade deal between India and the United States, which had been under negotiation for an extended period. U.S. President Donald Trump confirmed the agreement, stating specifically that reciprocal tariffs on Indian goods would be substantially reduced to 18%, representing a significant decrease from the previous rate of 50%.
President Trump elaborated on the agreement, stating: "We agreed to a Trade Deal between the United States and India, whereby the United States will charge a reduced Reciprocal Tariff, lowering it from 25% to 18%. They will likewise move forward to reduce their Tariffs and non-tariff barriers against the United States to ZERO." This statement highlights not only the tariff reduction but also the commitment to eliminate non-tariff barriers, suggesting comprehensive market access improvements.
Implications for the Jewellery Sector
The trade agreement holds particular significance for India's jewellery industry, which represents a substantial component of the country's export economy. The reduction in reciprocal tariffs from 25% to 18% directly benefits jewellery exporters by making their products more competitive in the lucrative American market.
This development is expected to:
- Enhance export opportunities for Indian jewellery manufacturers
- Improve profit margins for companies with significant U.S. market exposure
- Stimulate domestic manufacturing and employment in the jewellery sector
- Potentially increase foreign investment in India's jewellery industry
Broader Market Context and Future Outlook
The positive response in jewellery stocks occurred within the broader context of Indian equity markets, which have been closely monitoring international trade developments. The swift implementation signaled by both governments suggests that market participants anticipate tangible benefits in the near term.
Analysts suggest that this trade agreement could represent just the beginning of enhanced economic cooperation between India and the United States, with potential for further sector-specific benefits as the relationship develops. The jewellery sector's immediate positive response indicates investor confidence in the deal's implementation and its specific relevance to this industry segment.
As market participants continue to assess the full implications of this trade agreement, attention will likely focus on quarterly results from jewellery companies and export data to gauge the actual impact of the reduced tariffs on business performance and profitability.
