Market Commentary - Quick Review
The domestic equity benchmarks ended with minor gains today, after the government cut taxes on several goods as part of a major GST overhaul. The move aims to boost consumer spending ahead of the festive season and ease the impact of high U.S. tariffs, among other factors. Market participants' focus on GST reforms announced by the GST Council eclipsed the impact of the weekly expiry of Sensex F&O contracts.
The Nifty settled above the 24,700 level. Auto, financial services and FMCG shares advanced while PSU bank, oil & gas and IT shares declined.
As per provisional closing data, the barometer index, the S&P BSE Sensex added 150.30 points or 0.19% to 80,718.01. The Nifty 50 index rose 19.25 points or 0.08% to 24,734.30. In two consecutive trading sessions, the Sensex rose 0.69% while the Nifty added 0.62%.
The broader market underperformed the frontline indices. The S&P BSE Mid-Cap index shed 0.60% and the S&P BSE Small-Cap index fell 0.60%.
The market breadth was negative. On the BSE, 1,810 shares rose and 2,318 shares fell. A total of 163 shares were unchanged.
The NSE's India VIX, a gauge of the market's expectation of volatility over the near term, fell 0.70% to 10.85.
GST Reforms:
The GST Council approved the significant rate cuts on several essential items. Effective from September 22nd, the new rates aim to boost consumption by shifting to a two-slab structure of 5% and 18%, abolishing the 12% and 28% rates. A special 40% GST slab has been introduced for super luxury and sin goods.
In a major relief to the automobile and two-wheeler sector, GST on small cars and motorcycles with engine capacity up to 350cc has been reduced from 28% to 18%, a move aimed at boosting demand in the mass mobility segment. Additionally, parts and accessories of motorcycles up to 350cc will now attract 18% GST instead of 28%.
On the other hand, the levy on premium motorcycles exceeding 350cc has been sharply raised from 28% to 40%, making high-end bikes costlier.
The GST Council exempted individual life and health insurance policies from the 18% Goods and Services Tax (GST).
Several fast-moving consumer goods (FMCG) currently taxed at 12% or 18% will now fall under the 5% bracket. Further, GST on tractors (except road tractors for semi-trailers above 1800cc) has been redcued to 5% from 12%. For road tractors with engines above 1800cc, the tax was lowered to 18% from 28%. Additionally, GST on tractor tyres and parts was slashed from 18% to 5%.
In education segment, the council reduced GST on pencils, crayons, pastels, drawing charcoal, chalk sticks, and tailor's chalk from 12% to nil. Exercise books, graph books, laboratory notebooks, and notebooks too have been exempted from GST, compared with 12% earlier. Additionally, boxes, pouches, wallets, and writing compendiums of paper or paperboard containing assorted stationery will now attract 5% GST instead of 12%.
Buzzing Index:
The Nifty Auto index rose 0.85% to 25,994.85. The index added 2.69% in the two trading session.
Mahindra & Mahindra (up 5.86%), TVS Motor Company (up 0.93%), Eicher Motors (up 0.86%), Hero MotoCorp (up 0.04%) added.
On the other hand, Exide Industries (down 3.11%), Samvardhana Motherson International (down 2.27%) and Ashok Leyland (down 1.73%) turned lower.
Stocks in Spotlight:
Paisalo Digital jumped 3.03% after the company's board approved raising Rs 50 crore through issuance of debt securities via private placement.
Force Motors fell 8.52%. The company said that its domestic sales jumped 6.60% to 2,295 units in August 2025, as against 2,153 units sold in August 2024.
Angel One shed 0.42%. The firm announced that its client base jumped 26% to 33.57 million in August 2025, compared with 26.65 million in August 2024.
Asian Hotels (North) rose 1.67% after the company announced that Arjun Raghavendra Murlidharan has been appointed as the chairman of the board of directors, effective from 13 September 2025.
CFF Fluid Control rose 0.22%. The company announced that it had received a Letter of Intent (LOI) from the Indian Navy's Material Organisation for the supply of various equipment under the P75 submarine project.
GHV Infra Projects rose 2.03% after the firm has received a letter of intent (LoI) worth Rs 120 crore from GHV (India) for engineering and construction work for the integrated redevelopment of a South Eastern Railway station in Jharkhand.
Global Markets:
European stocks traded mixed on Thursday as investors weighed the potential impact of U.S. President Donald Trump's trade tariffs.
Asian market ended mixed as government data showed that Australia's household spending rose 0.5% month-on-month in July.
Global bond markets will continue to be in focus with long-dated borrowing costs around the world under pressure. The U.S. 30-year Treasury yield nudged above 5% on Wednesday morning for the first time since July after a court ruled that most of the Trump administration's tariffs are illegal, raising questions over the future of tariff revenues.
Overnight on Wall Street, U.S equities closed mixed. The S&P 500 rose Wednesday, boosted by tech shares after a federal court decision in an Alphabet antitrust case fueled optimism that the tech giants would be able to weather regulatory threats.
Nasdaq Composite gained 1.03%, while the S&P 500 climbed 0.51%. The Dow Jones Industrial Average shed 0.05%.
Traders awaited for Nonfarm payrolls data due on Friday.
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