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yesterday

Indian Stocks Surge as Modi’s GST Overhaul and S&P Upgrade Fuel Rally

States have received the Centre’s draft GST proposal for a two-slab system before Diwali under pressure from an impending US tariff deadline.

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PM Modi last week announced what he termed as a massive “Diwali gift” for the people of the country, promising reforms in the GST regime.
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Overview

  • The Nifty50 jumped past 25,000 and the Sensex added over 1,000 points on August 18 following PM Modi’s GST overhaul announcement and S&P Global’s upgrade to BBB with a stable outlook.
  • Auto and consumer names led gains, with Hero MotoCorp rising more than 8% and Maruti Suzuki up over 6% on expectations of lower indirect taxes.
  • The government circulated its draft next-generation GST reforms to states, proposing just two rate slabs of 5% and 18% to simplify the existing structure by Diwali, pending state approval.
  • S&P’s first sovereign rating upgrade for India in 18 years reflects confidence in the country’s strong economic fundamentals and policy management.
  • Analysts caution that volatility may persist as heavy early-August FII selling, mixed corporate earnings and the August 27 US tariff deadline pose potential headwinds.