Mumbai–Cheering the launch of the country’s biggest indirect tax reform — the Goods and Services Tax (GST) — on July 1, the Indian equity markets turned bullish and closed with substantial gains on Monday.

Market observers opined that the key indices rose close to 1 per cent on the first trading day of the month as positive global cues and healthy automobile results buoyed investors’ sentiments.

The S&P BSE FMCG index rose by 3.40 per cent to hit a record high, with ITC — which is the largest contributor to the index — witnessing the highest momentum.

According to market analysts, stocks of the FMCG major rose after additional excise duty on cigarettes was removed under the GST regime.

“With implementation of GST, FMCG stocks rallied, especially ITC, after news of no additional excise duty on cigarettes. The shift from unorganised sector to organised sector is beneficiary to FMCG companies,” Dhruv Desai, Director and Chief Operating Officer of Tradebulls, told IANS.

The wider Nifty of the National Stock Exchange (NSE) rose by 94.10 points or 0.99 per cent to close at 9,615 points.

The 30-scrip Sensitive Index (Sensex) of the BSE, which opened at 31,156.04 points, closed at 31,221.62 points — up 300.01 points, or 0.97 per cent, from its previous close at 30,921.61.

The Sensex touched a high of 31,258.33 points and a low of 31,017.11 during intra-day trade.

The BSE market breadth was bullish — 1,799 advances and 876 declines.

The broader market indices outperformed the Sensex, with the S&P BSE mid-cap index up by 1.13 per cent and the small-cap index by 1.05 per cent.

“The first trading session of July started on a positive note as the key benchmark indices settled with healthy gains on the back of positive global cues. The sentiment was also helped after the biggest tax reform, the GST, came into force from July 1,” Deepak Jasani, Head of Retail Research, HDFC Securities, told IANS.

“A rally in ITC helped the Nifty to register healthy gains. Major Asian markets ended on a positive note, barring the Straits index. European indices like FTSE 100, CAC 40 and DAX traded higher,” he added.

However, on the currency front, the rupee weakened by 30 paise to 64.88 to a US dollar from its previous close at 64.58.

In investments, provisional data with the exchanges showed that foreign institutional investors (FIIs) sold stocks worth Rs 804.67 crore while domestic institutional investors (DIIs) purchased scrips worth Rs 954.34 crore.

“Market turnover was higher today and index future and option saw rise in volume against Friday’s numbers. Carmakers’ stock prices jumped after car companies posted monthly sales numbers,” Desai added.

Sector-wise, all the 19 sub-indices of the BSE ended in the green. The S&P BSE FMCG index surged by 354.69 points, the automobile index by 310.85 points and the metal index by 210.82 points.

Major Sensex gainers on Monday were: ITC, up 5.70 per cent at Rs 342.30; Hero MotoCorp, up 2.17 per cent at Rs 3,777; Maruti Suzuki, up 1.96 per cent at Rs 7,359.30; Coal India, up 1.95 per cent at Rs 248.95; and Infosys, up 1.68 per cent at Rs 951.40.

Major Sensex losers were: NTPC, down 1.17 per cent at Rs 156.60; Kotak Bank, down 0.72 per cent at Rs 948.55; Cipla, down 0.60 per cent at Rs 551.05; Sun Pharma, down 0.54 at Rs 551.50; and Lupin, down 0.50 per cent at Rs 1,055.15. (IANS)