Indian markets enter the final week of February 2026 facing a major shift in the global trade landscape. Following a landmark U.S. Supreme Court ruling on February 20 that struck down high reciprocal tariffs, the U.S. administration has swiftly moved to a new 10% global baseline tariff. Domestic indices ended the previous session on a positive note, but investors are now recalibrating for Monday's opening. The Nifty 50 closed near 25,571 while the Sensex settled at 82,814. Despite the underlying strength in financials and PSU banks, the export-oriented IT and pharmaceutical sectors are expected to see heightened volatility as the legal and fiscal implications of the new U.S. trade regime become clearer. The effective average tariff on Indian exports is now estimated at approximately 13.4%. While this is a significant reduction from the earlier proposed 18% to 25% range, the new 10% surcharge remains a hurdle for high-volume sectors. The textiles and apparel industries remain particularly wary. The U.S. is the largest destination for Indian garment exports, and although the recent court ruling provides some legal relief, the 10% surcharge under Section 122 of the Trade Act of 1974 is set to begin on February 24. This temporary measure is slated for 150 days, creating a short-term window of uncertainty for order pricing and profit margins. The pharmaceutical and electronics sectors may find themselves more competitive under the reduced 10% rate compared to previous reciprocal threats. However, specific duties on steel and aluminum remain high at roughly 50% under national security provisions, which were not affected by the recent court decision. Currency markets are also under pressure, with the Rupee trading near the 90.98 level against the Dollar. A weaker currency may provide a cushion for exporters, but it also adds to the cost of imported raw materials and energy. Brent crude prices have recently spiked toward $72, further complicating the inflation outlook. The Indian government is currently studying the legal details of the U.S. court verdict. Discussions regarding the Interim Trade Deal—originally based on an 18% reciprocal rate—may now require a full realignment. Market participants are watching for official statements from the Commerce Ministry to gauge if India will modify its own commitments on U.S. agricultural and industrial goods in response to these changes. Short-term market sentiment will likely be driven by sector-specific reactions. While the broader indices show resilience, the "wait-and-watch" mode prevailing in New Delhi and Washington suggests that a period of consolidation is probable before a new trend emerges.