Indian stock markets remained poised for a robust session on Thursday as investors rejoiced at the next-gen GST reforms announced by the GST Council on Wednesday night. The BSE Sensex started the session at 81,254, surging close to 700 points, while the NSE Nifty50 opened trading at 24,920, jumping more than 200 points, around 9:15 AM.
The GIFT Nifty gave clear indications of what to expect from today’s market as it climbed more than 100 points to cross 24,950 around 9 AM. In the pre-open session, both benchmarks touched the sky as they climbed more than 1 per cent each, with Sensex soaring more than 1,200 points to cross 81,750 and Nifty above 25k, after jumping nearly 300 points, around 9:05 AM.
On the 30-share Sensex, M&M, Bajaj Finance, Bajaj Finserv, HUL, and UltraTech Cement stood among the gainers, while the laggards included NTPC, Eternal, Tata Steel, Reliance, and HCL Tech.
In the broader markets, the Nifty Financial Services index climbed 0.67 per cent. Sectorally, the Auto index dominated in green as it surged 2.23 per cent. Other major gainers included the FMCG and Financial Services Ex-Bank indices which jumped 1.51 per cent and 1.33 per cent respectively. The Metal index, on the other hand, slipped 0.39 per cent.
GST Reforms Uplift Sentiment
The GST Council, chaired by Finance Minister Nirmala Sitharaman, adopted the new two-slab GST structure of 5 per cent and 18 per cent, along with a higher 40 per cent bracket for luxury and sin products on Wednesday.
The GST reforms will take effect from September 22. The change eliminates the 12 per cent and 18 per cent slabs currently in place. At a media briefing after the meeting, Sitharaman underlined the significance of the reform and expressed appreciation for the Council members’ cooperation. “PM Modi asked to give relief to customers in GST,” she said, adding that the decision was adopted unanimously despite “minor” concerns.
Relief For Common Man
According to Sitharaman, the restructuring has been designed to ease the burden on the common man. “These reforms have been carried out with a focus on the common man. Every tax on the common man’s daily use items has gone through a rigorous review, and in most cases the rates have come down drastically… Labour intensive industries have been given a good support. Farmers and the agriculture sector, as well as the health sector, will benefit. Key drivers of the economy will be given prominence,” she remarked.
The Finance Minister confirmed that the changes will be applicable from September 22, coinciding with the first day of Navratri. However, she clarified that sin goods such as tobacco will continue to attract the existing GST rates and compensation cess until dues from the cess account are cleared. “The Union Finance Minister and the Chairperson of the GST Council is authorised to decide on the actual date of the transition for these tobacco related products as soon as the loan and interest is cleared,” she said.
Under the new structure, everyday items like butter, ghee, jam, dry fruits, biscuits, pastry, ice cream, namkeen, bottled water, fruit juices and milk-based beverages will move from the 18 per cent slab to 5 per cent. Footwear and apparel priced up to Rs 2,500 will also attract 5 per cent GST, compared to the earlier limit of Rs 1,000. In the personal care category, goods like toothpaste, shampoo, soap and hair oil also shifted from 18 per cent to 5 per cent.
Notably, markets remained optimistic in the previous trading session on Wednesday, however, the gains were limited. The Sensex settled yesterday over 80,550, while the Nifty closed above 24,700.
