It was another fight today between the bulls and bearish forces and the bearish forces managed to pull the gains down to lower greens.
GIFT Nifty futures and US stock markets as of now have shown a minor downtrend of about 0.18%, indicating a challenging opening for Nifty 50 tomorrow, although the approval of GST-reforms by the GoM reportedly will keep the bullish forces confident to trade in green.
The local indices have been displaying strength in recent days, with Nifty fluctuating above 25,050 and Sensex gaining 142 points today. Sectoral advances in the pharma, finance, and insurance spaces, led by majors such as Dr Reddy's Laboratories, Cipla, and ICICI Bank, have supported benchmarks. The stimulus from high local corporate earnings is now supplemented by the GoM's positive GST proposals, which will reduce tax rates, make compliance easier, and increase tax collection. These measures are bound to find favour with business and investors, which could provide an additional spur to market confidence and support sustained market rallies.
Also Read | 21 August, 2025 : Markets Closed with Marginal Gains amid Lethargy
The GoM's GST proposals released today comprise simplification of tax slabs and enhanced clarity on contentious categorisations, which are likely to reduce compliance burdens across industries. These reforms can facilitate ease of doing business, enhance formalisation, and potentially induce investment in priority sectors. The immediate market reaction has been positive, as investors anticipate these reforms will result in better tax clarity and stability, thereby reducing policy-related uncertainties that often weigh on market sentiment. This policy clarity aligns with the government’s long-term growth agenda and could reinforce investor optimism toward Indian equities.
ALSO READ | GST GoM Meet Being Held, Reforms Likely to be the Agenda
The Indian Rupee remains relatively stable against the US Dollar at about ₹87.29 per USD, with a slight depreciation of 0.29%. This relative stability, fuelled by steady foreign capital inflows, reduces volatility risks for Indian equities, particularly import-dependent and export-oriented sectors. The RBI’s measured approach and ongoing macroeconomic stability are supporting the INR, providing a positive backdrop for market sentiment heading into tomorrow’s trading.
ALSO READ | Goods in 28% GST to be mostly slashed to 18% slab, Reports suggest
US markets trade down, with Dow Jones losing 0.48% to trade at 44,730. The pivotal Jackson Hole symposium when the speech by Fed Chair Jerome Powell may have a bearing on global liquidity and risk appetite. Due to the correlation between Indian and US markets, this cautionary note can check bullish fervour in India, especially impacting IT and export-oriented industries sensitive to Nasdaq movement.
ALSO READ | Reformed Slabs: ACs, Daily-use Products May Get Huge GST Slash
Indian ADRs listed on US stock exchanges performed mixed but overall positive gains, with Infosys and Wipro increasing; and ICICI Bank and MakeMyTrip also posting marginal gains. Such strong ADR performance indicates persistent confidence by investors in India's growth path and corporate earnings, further backing Indian equities in times of global uncertainties.
Tomorrow's opening in Indian markets is expected to be positive but tempered, influenced by strong domestic fundamentals such as the positive spill effect of GoM's GST reforms, consistent INR levels, and supportive ADR trends. Yet, global prudence in advance of the Jackson Hole event and mixed signals from the big US indices are expected to keep the investors on their toes. Sector-specific strategies targeting domestic consumption, finance, and IT can aid in managing the balancing act of domestic optimism and international uncertainty.
Essentially, Indian markets seem well-placed to achieve a sustained rally with the additional fillip from the GST reforms boosting business confidence and policy clarity while remaining chary of external economic pressures.gi
