GST Reforms & Global Cues To Drive Market Sentiment, Analysts See Positive Start Next Week

Mumbai: The stock market is set to begin the week on a positive note after Prime Minister Narendra Modi announced plans for major GST reforms by Diwali. The reforms aim to simplify the eight-year-old tax system, lower prices of daily-use items, and address issues such as compliance gaps and tax evasion. Analysts believe the announcement will lift investor sentiment and help markets recover from recent weakness.

Santosh Meena, Head of Research at Swastika Investmart, said the Prime Minister’s Independence Day address has the potential to cheer markets, especially the mention of GST rate cuts which could give a strong push to equities.

Global developments to watch

Markets will also closely follow the outcome of the Putin-Trump summit in Alaska, which ended without a ceasefire deal but was described by President Trump as showing “great progress.” Although details were not shared, the easing of US-Russia tensions is seen as a relief for investors, reducing fears of fresh sanctions on India.

At the same time, attention will turn to the US Federal Reserve’s meeting minutes and upcoming US economic data, both of which could influence global market flows.

Credit rating upgrade supports sentiment

Adding to the positive mood, S&P Global Ratings upgraded India’s sovereign credit rating from BBB- to BBB with a stable outlook, the first such move in more than 18 years. The upgrade reflects confidence in India’s strong economic growth, fiscal discipline, and supportive monetary policy. Analysts say this could improve foreign investor sentiment and attract fresh inflows into Indian equities.

Analysts’ outlook

VK Vijayakumar of Geojit Investments noted that easing trade concerns, especially the reduced risk of a 25 percent US tariff on India after August 27, along with the credit rating upgrade, should work in favour of markets. EY India’s Saurabh Agarwal added that GST 2.0 is a structural reform that will make exports more competitive and free up working capital by fixing inverted duty structures.

Last week, the Sensex rose 739 points (0.92 percent) and the Nifty gained 268 points (1.1 percent), indicating early signs of recovery. Analysts expect the momentum to continue, with sector-specific opportunities emerging as reforms take shape.