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Sensex surged 889 points as the GST Council led by Nirmala Sitharaman approved major GST reforms, simplifying slabs and reducing rates on essentials, effective September 22.
Sensex Today: Nifty opens above 24,900, Sensex up 600 pts.
Stock Market Today: Sensex shed 500 points from the day’s high amid the profit booking. At noon, the benchmark index was trading at 80,932, from the day’s opening at 81,456. Nifty also came down to 24,800, from the day’s opening, 20 points short of 25,000.
Following the GST reform announcement, suggesting a rationalised two-slab structure, the Indian stock market saw a gap up opening on Thursday.
M&M remained the top gainer in the morning bell with an uptick of 6.73 per cent. Bajaj Finance (+4.70%), Bajaj Finserv (+3.07%), ITC (+2.26%), Hindustan Unilever (+2.13%) were among top gainers.
Eternal (-0.75%), Tata Steel (-0.36%), Reliance (-0.31%), HCL Tech (-0.27%) were among top losers in the morning session.
In a sweeping reform, the GST Council, led by Finance Minister Nirmala Sitharaman, has approved a sharp overhaul of the Goods and Services Tax (GST) structure. Effective September 22, the system will be simplified into just two main slabs of 5% and 18%, replacing the current 12% and 28% rates, with a special 40% slab for luxury and sin goods. Billed as a “historic Diwali gift” for citizens and businesses, the reforms aim to lower the cost of living, boost consumption, and spur economic activity.
Household products like hair oil, shampoo, toothpaste, toilet soaps, shaving cream and toothbrushes will now attract just 5% GST instead of 18%. Rates on butter, ghee, cheese, packaged namkeens, dairy spreads and utensils have been cut from 12% to 5%. Feeding bottles, clinical diapers and sewing machines too move into the lowest slab.
Santosh Meena, Head of Research at Swastika Investmart.
The Indian stock market is poised to embrace the proposed GST reforms, streamlining tax slabs to 5% and 18%. This reduction, especially from the 12% and 28% brackets, is expected to spur consumer demand ahead of the festive season, benefiting sectors like consumer durables, automobiles, and FMCG. However, stocks in these sectors have already surged in anticipation. The tax cut supports consumption-driven growth, but its success hinges on companies passing on savings to consumers. Markets will also factor in the long-term impact on government revenue and the broader economy.
Technically, the Nifty is forming a double bottom in the 24,350-24,500 range. A break above the 24,770 resistance could target 25,000, and a close above this level may trigger a significant rally.
Varun Yadav is a Sub Editor at News18 Business Digital. He writes articles on markets, personal finance, technology, and more. He completed his post-graduation diploma in English Journalism from the Indian Inst…Read More
Varun Yadav is a Sub Editor at News18 Business Digital. He writes articles on markets, personal finance, technology, and more. He completed his post-graduation diploma in English Journalism from the Indian Inst… Read More
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