The Indian stock market witnessed a significant surge as the Sensex jumped by 676 points and the Nifty rose by 1 percent, driven primarily by optimism surrounding upcoming GST reforms. This rally reflects renewed investor confidence, fueled by hopes that the proposed changes to the Goods and Services Tax framework will streamline tax processes and enhance economic efficiency.

On the day, the 30-share BSE Sensex settled at 81,273.75, marking a solid increase of 676.09 points or 0.84 percent from the previous close. The index even soared higher during the trading session, touching a peak gain of over 1,168 points at 81,765.77, signaling strong buying momentum. Meanwhile, the Nifty 50 benchmark index climbed 245.65 points to close at 24,876.95, a rise of nearly 1 percent.

Several factors contributed to this upbeat market sentiment. The primary catalyst was the government’s bid to reform the GST system, a move viewed positively by investors who anticipate that the overhaul will reduce compliance burdens and potentially increase tax revenues. The announcement about GST reform created an encouraging backdrop for sectors particularly sensitive to tax policies, such as manufacturing, consumer goods, and financial services.

Adding to the positive mood was the upgrade of India’s long-term sovereign credit rating by S&P Global. After 18 years, India’s rating was elevated from BBB- to BBB with a short-term rating upgrade from A-3 to A-2. This rating boost underlines the country’s improving economic fundamentals and is seen as an affirmation of sustainable growth prospects. In response, foreign investors showed renewed interest in Indian equities, contributing to the upward momentum.

Sector-wise, automotive shares led the gains, propelled by expectations of higher consumer demand driven by the GST reforms and easing global pressures. Banking stocks also performed well, with major players such as State Bank of India and HDFC Bank among the top winners, further boosting the market’s overall strength.

This market activity ended a recent bout of hesitation, as both Sensex and Nifty snapped a six-week losing streak, indicating a possible trend reversal in the near term. Investors have been closely watching global cues, domestic policy developments, and corporate earnings for cues, and the recent GST reform bid alongside the credit upgrade has now provided a fresh dose of optimism.

In parallel, the Indian rupee depreciated marginally against the US dollar but remained relatively steady, suggesting a balanced outlook among forex traders amid the market rally.

In summary, today’s robust market performance was a welcome relief and highlights the market’s sensitivity to policy reforms and macroeconomic factors. Investors can be cautiously optimistic as the government’s tax reform initiatives and India’s improving credit profile seem poised to support sustained market growth. However, it remains essential to monitor global economic conditions and sector-specific developments to fully gauge the sustainability of this rally.