The step of the GST council to simplify the tax rates and lower levies for supplies, the Nifty pushed after 24,700. Cars and FMCG shares led the load, where investors bet that lower GST will stimulate consumption. Nifty Metal and Nifty Auto -Indices each achieved more than 5% during the week.
Yet the optimism turned out to be short -lived. Stocks came under sharp pressure, affected by concern about a weak global question and cuts in discretionary technological expenditures. Global jitters have added to the mix, with bond returns in Europe that affect decade heights and foreign investors who keep getting money from Indian shares. The rupee slid to a record low against the dollar and buying a safe haven pushed gold prices to new peaks.
For the week, the Nifty achieved a win of 200 points, but the vote was modest compared to the sharp rally that many had hoped to unleash GST 2.0.
What analysts say
Pravesh Gour, senior technical analyst at Swastika Investmart, said that the GST reforms have laid the foundation for growth, even if the impact will take time to prove. “The biggest news was the GST rationalization, which has activated a strong purchase in the middle of small caps. Maxwell, Global Strategy Lead at VT markets, emphasized the relative underperformance of India versus Asian colleagues.
“Foreign investors have been heavy sellers this year and are shifting to cheaper markets such as Taiwan, Zuid -Korea and China. High American rates on Indian goods are a different headwind. Although the growth of GDP is strong, the profit momentum of the company is weak and high valuations is less attractive in the short term.”
The way for us
This week, investors will view both domestic and global signals. On the domestic side, it is expected that the GST cuts and government spending is expected to support sectors driven by consumption. Cars, FMCG and other growth-linked industries can continue to benefit. However, weak urban demand and carefully business sentiment continue to take care of it.
The spotlights will be in US economic data worldwide. The upcoming job report and inflation lectures can be the expectations for an acceleration of the FED rate, a movement that would offer relief to emerging markets such as India. The policy position of the European Central Bank will also be followed closely.
Technically, Nifty tries to form a basis in the zone of 24,500-24,350, but is confronted with resistance near 25,000. A breakout can cause a new momentum, while a fall under 24,350 can drag the index to 24,100. For the Bank Nifty, recovering 55,000 is the key to push higher.
Analysts say that the GST 2.0 -Hype may not have supplied fireworks, but the story is not over yet. Domestic policy support, resilient consumption and the relief of global rates can still form the stage for a stronger rally.
(Disclaimer: recommendations, suggestions, views and opinions of the experts are their own. These do not represent the views of economic times)
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