Market Surge on GST and Rating News

Equity markets in Mumbai witnessed a significant surge as the Sensex climbed 676 points to close at 81,274, and the Nifty gained 1% to end at 24,877. This rally, the largest single-day percentage gain since June 26, 2025, was fueled by strong buying in autos and consumer durables, alongside positive developments in GST reforms and a sovereign rating upgrade by S&P.

Sector Highlights and Global Context

Autos led the charge with the BSE auto index jumping 4.3%, highlighted by Maruti's nearly 9% rise. Meanwhile, global markets presented a mixed picture, with Japan and China ending higher, and European indices trading lower. The rupee strengthened against the dollar, settling at 87.35, up 20 paise from the previous session.

Challenges Ahead

Despite the upbeat market sentiment, bonds erased most of Friday's gains due to fears of higher government borrowing, with the 10-year bond yield rising to 6.49%. The proposed GST overhaul, aiming to simplify the tax structure, may also lead to shortfalls in government revenues this year.