Sensex Rises Over 300 Points, Nifty Regains 9,600; ITC Jumps

ITC shares surged with analysts attributing the sharp move to a more or less status quo in terms of taxation on cigarettes in the new GST regime.

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Sensex Rises Over 300 Points, Nifty Regains 9,600; ITC Jumps

Nifty FMCG rose nearly 6 per cent at day's high supported by heavyweight ITC

Indian markets started the month on a positive note, with the Sensex adding more than 300 points and the Nifty rising 92 points to regain the 9,600 mark. GST finally became a reality with the much-awaited midnight launch of the new tax regime on June 30. Gains in the domestic markets were led by FMCG, auto, metal and realty shares - up between 1 per cent and 4 per cent in late morning deals. The FMCG sub-index - Nifty FMCG - rose nearly 6 per cent at day's high supported by heavyweight ITC, which surged nearly 6 per cent. ITC shares surged with analysts attributing the sharp move to a more or less status quo in terms of taxation on cigarettes in the new GST regime.

Indian shares also took positive cues from other Asian markets, which held two-years highs, starting the new month on a solid footing after two quarters of gains while expectations of credit tightening by the world's major central banks kept global bond markets under pressure. On Wall Street, the S&P 500 scored its biggest gain for the first half of the year since 2013 while the Nasdaq Composite's first-half gain was its best in eight years.

ITC, Bharti Infratel, Hindalco Industries, Vedanta and Eicher Motors - trading between 2 per cent and 6 per cent higher - were among other top gainers on the 51-scrip Nifty.

Selling was seen in some IT and pharma shares. Around late morning, among the top Nifty losers were HCL Technologies, Wipro, Bajaj Auto, Sun Pharma and NTPC - down up to 2 per cent.

Analysts say that the Street would be looking at GST implementation over the next few months and the impact to particular sectors. "We expect markets to remain volatile and track the management commentary on how they are adjusting to the issues arisen due to the GST," domestic brokerage Angel Broking said in a note.

According to global rating agency Moody's Investors Service, the implementation of GST will be positive for India's credit rating as it will lead to higher GDP growth and increased tax revenues.

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"Over the medium term, we expect that the GST will contribute to productivity gains and higher GDP growth by improving the ease of doing business, unifying the national market and enhancing India's attractiveness as a foreign investment destination," Moody's VP (sovereign risk group) William Foster said.

At 11:21 am, 37 shares in the Nifty index were trading in the positive zone. On the other hand, 14 scrips were in the red. The Nifty was up 82 points or 0.86 per cent while the BSE benchmark index - Sensex - was trading 274 points, or 0.88 per cent, higher.

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