Explosive rallies dominated Indian financial markets Monday following Prime Minister Narendra Modi's commitment to deliver comprehensive Goods and Services Tax restructuring by Diwali 2025, while S&P Global Ratings' sovereign credit enhancement to 'BBB' from 'BBB-' – the first such advancement in 18 years – amplified investor enthusiasm across all sectors.
The dramatic surge saw BSE Sensex rocket 1,168 points intraday to peak at 81,765.77, while NSE Nifty50 recaptured the psychologically important 25,000 level, achieving an intraday summit of 25,022 after gaining 391 points from Friday's closing position of 24,631, according to Business Standard.
Trading momentum sustained throughout the session, with BSE Sensex maintaining elevation at 81,741.88, marking a substantial 1,144.22-point or 1.42% advancement, while NSE Nifty50 secured 381.40 points or 1.55% progress to establish 25,012.70 levels.
Widespread optimism characterized market participation as twenty-five of thirty Sensex components registered positive territory. Leading performers encompassed Maruti Suzuki, Bajaj Finance, Ultratech Cement, Mahindra and Mahindra, Trent, and Hindustan Unilever, delivering returns spanning 3% through 7.5%.
Mid and small-cap segments participated robustly, with NSE MidCap 100 advancing 1.43% and Nifty SmallCap 100 contributing 1.2% gains. Sectoral strength proved universal, highlighted by Nifty Auto's commanding 4.35% surge and Nifty Consumer Durables' impressive 3.22% elevation. Banking, Financial Services, FMCG, Metal, and Realty segments delivered additional advances reaching 3%.
Modi's transformative GST announcements during Friday's Independence Day address at Red Fort targeted nationwide tax burden reduction, with Sunday reports from Business Standard confirming the prime minister's appeals for state government cooperation in reform implementation.
Market strategists highlighted the reform timeline's significance. "The expectation is that most of the goods and services will be in the 5% and 18% tax slabs. Sectors like autos and cement, which are presently in the 28% tax slabs, are expected to benefit. TVS Motors, Hero, Eicher, M&M and Maruti are likely to respond positively to the news. Insurance companies are also expected to benefit from the GST revision," VK Vijayakumar, chief investment strategist at Geojit Investments, explained.
Thursday's sovereign rating advancement by S&P Global Ratings delivered additional momentum, with the agency crediting economic expansion, enhanced monetary policy effectiveness, and consistent fiscal discipline. S&P projected manageable impacts from potential US tariffs, emphasizing India's reduced trade dependency and robust domestic consumption patterns.
Investment professionals celebrated the historic milestone. "The landmark ratings upgrade after 18 years signals enhanced investor confidence and could trigger sustained foreign inflows into Indian markets," Devarsh Vakil, head of prime research at HDFC Securities, stated.
Geopolitical developments contributed supportive undertones as the highly anticipated Alaska summit between US President Donald Trump and Russian President Vladimir Putin concluded with commitments for continued dialogue, despite producing no immediate formal agreements, fostering optimism regarding Russia-Ukraine conflict de-escalation possibilities.
Technical perspectives reinforced bullish momentum sustainability. Anand James, chief market strategist at Geojit Financial Services, identified encouraging reversal signals across market breadth. "Last week's reversal attempts stalled in the 24,670-720 region, depriving Nifty of a bullish confirmation. However, 43% and 39% of mid and small cap index constituents respectively ended up above their respective 10-day SMAs, the highest since late July, suggesting that a broad market reversal is already in play," James observed.
James maintained optimistic projections for continued advancement. "This encourages us to persist with the 24,850-25,000-25,200 objectives discussed last week. Expect 24,850 to pose a stiff challenge, but upside hopes may be persisted with, as long as the volatility thereof is contained above 24,650," he added.
