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Key Points

The domestic stock market opened the week with strong momentum driven by GST rationalization optimism. Despite some profit booking and external pressures, investor confidence remained high following an S&P sovereign rating upgrade. Indian policymakers advanced a $20 billion GST-driven consumption stimulus expected to boost GDP by 0.6%. The market continues to show resilience with solid growth projections of 6.5-6.7% for Q1 FY26.

Key Points: Indian Stock Market Shows Resilience Amid GST Boost Global Uncertainties

  • Market started week strong on GST rationalization optimism
  • S&P sovereign rating upgrade boosted investor confidence
  • Rally slowed due to profit booking and external pressures
  • Consumption sector benefits from monsoon and tax reliefs
2 min read

GST booster: Stock market shows resilience against global uncertainties this week

India's stock market demonstrates strength with GST rationalization and S&P upgrade, maintaining momentum despite global headwinds and US tariff concerns.

"India’s macro stance is defined by proactive fiscal support, policy credibility, and resilience against global uncertainty - Arsh Mogre, PL Capital"

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umbai, Aug 23 (IANS The domestic stock market started the week with a gap-up, driven by optimism surrounding GST rationalisation, analysts said on Saturday, adding that this week underscored India’s dual strategy of cushioning external headwinds while reinforcing domestic growth drivers.

Additionally, a sovereign rating upgrade by S&P added another layer of confidence among investors.

“However, the rally lost momentum toward the end of the week as investors turned cautious due to profit booking and external headwinds. A spike in the 10-year Indian government bond yield also raised concerns about the fiscal position in light of the GST reforms,” said Vinod Nair, Head of Research, Geojit Investments Ltd.

According to analysts, the market is awaiting clarity on whether the additional 25 per cent US tariffs on Indian goods, linked to the import of Russian oil, will be implemented next week.

In the US, stocks surged on Friday after Federal Reserve Chair Jerome Powell suggested a rate cut could be coming soon. The Dow made a new intra-day record, rising by more than 900 points.

According to Arsh Mogre, Economist, PL Capital, Indian policymakers advanced a $20 billion GST-driven consumption stimulus and enacted a modernised Income-tax Act to simplify compliance and lift household demand. These moves are expected to add 0.6 per cent to GDP.

The RBI reaffirmed its 4 per cent inflation target, signalling continuity in monetary policy despite volatile global conditions.

“With Q1 FY26 growth projected at 6.5–6.7 per cent, momentum remains solid, though near-term risks hinge on US monetary signals and trade frictions. Overall, India’s macro stance is defined by proactive fiscal support, policy credibility, and resilience against global uncertainty,” said Mogre.

On Friday, Sensex ended the session at 81,306.85, down 693.86 points or 0.85 per cent. Ending upward momentum, the 30-share index opened the session in negative territory at 81,951.48 against last session's closing of 82,000.71. The index further extended the losing momentum to hint intra-day low at 81,291.77 amid overall selling.

Nifty closed at 24,870.10, down 213.65 points or 0.85 per cent.

According to analysts, the consumption sector is likely to benefit from a favourable monsoon, low interest rates, and indirect tax reliefs.

—IANS

- IANS

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Reader Comments

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Rohit P
Profit booking at higher levels is natural, but the underlying fundamentals remain strong. The S&P upgrade and RBI's consistent policy are positive signs for long-term investors like me.
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Arjun K
The US tariff threat is concerning though. We need diplomatic solutions to avoid trade friction affecting our exports. Government should handle this carefully.
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Sarah B
As an NRI investor, I'm impressed by India's resilience. The 6.5%+ growth projection is fantastic compared to other emerging markets. Keep up the good reforms! 💪
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Vikram M
The consumption sector boost with good monsoon and tax reliefs should benefit rural India significantly. This is inclusive growth strategy working well.
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Michael C
While the reforms are positive, I hope the government addresses the fiscal concerns raised by the bond yield spike. Sustainable growth requires fiscal discipline too.

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