Stock Market Today: Sensex at 80,718, Nifty 50 Holds 24,734

The auto and fast-moving consumer goods (FMCG) sectors emerge as leaders of the day

The Indian stock market opens on a strong footing, lifted by optimism surrounding the new Goods and Services Tax (GST) reforms and expectations of a possible US Federal Reserve rate cut. Gift Nifty indicates a bullish start, trading near 24,885 in early signals. 

As the market session begins, the Nifty 50 touches 24,818.85, marking a 0.34 percent rise, while the Sensex climbs to 81,012.42, up 0.36 percent. Fifteen of the sixteen major sectors open in positive territory, reflecting widespread enthusiasm across the board.

Intraday Movements

During the session, strong momentum carries the indices forward. The Sensex surges more than 250 points at one stage, while the Nifty once again crosses the 24,800 mark, extending its streak of three consecutive days above this key level. Reliance Industries and HDFC Bank, along with other heavyweights, lead the rally and fuel investor confidence. 

However, as the day progresses, profit-booking emerges. After opening nearly 900 points higher, the Sensex gives up most of its gains and eventually trades flat. This pattern shows how initial excitement over reforms translates into early buying, followed by selling pressure as investors lock in profits.

Sector Performance

The auto and fast-moving consumer goods (FMCG) sectors emerge as leaders of the day. Companies in these industries benefit directly from lower tax rates and increased hopes of higher consumer spending. On the other hand, oil and gas, real estate, and metal sectors remain under pressure and close weaker. The divergence between consumer-focused sectors and commodity-linked industries highlights the uneven impact of the GST reforms.

Top Gainers and Losers

Among individual stocks, Mahindra & Mahindra posts strong gains, supported by a positive demand outlook in the auto segment. Bajaj Finance and Bajaj Finserv also move higher, adding strength to the financial sector. Apollo Hospitals and Nestlé deliver notable advances as well. In contrast, HDFC Life, Tata Consumer, and Wipro end the day as the leading laggards. The split between gainers and losers shows how investors are selectively placing bets on companies that stand to benefit most from the revised tax regime.

GST Reform as a Market Driver

The main trigger for the day’s movements is the launch of the GST 2.0 reform. This overhaul replaces the earlier multi-tier structure with a simplified two-tier system. Essentials now fall under a 5 percent tax rate, while most other goods are taxed at 18 percent. The 12 percent and 28 percent slabs are scrapped, and a new 40 percent rate is imposed on luxury items and sin goods. Importantly, health and life insurance premiums are made tax-free.

The reform not only simplifies compliance but also eliminates long-standing procedural issues such as inverted duty structures. The government expects this step to boost consumption during the festive season, though it acknowledges an estimated revenue loss of around ₹480 billion. The move is also politically significant, coming ahead of key state elections, and demonstrates the government’s focus on providing relief to households and supporting demand.

Market Sentiment on Reforms

Investor reaction to the GST reform is initially highly positive. The prospect of cheaper essentials and greater spending power drives enthusiasm in consumer-facing sectors. Automobiles, FMCG, and insurance stocks benefit early in the day. However, as the session wears on, concerns surface over whether tax relief alone can sustain long-term growth. 

Many investors question whether higher incomes and job creation are equally necessary to support consumption. This caution triggers profit-booking, leading to a flat finish despite strong intraday highs.

Global Factors at Play

Global cues also add to the optimism. Recent US labor market data came in weaker than expected, increasing hopes of an interest rate cut by the Federal Reserve. Lower US rates generally support capital flows to emerging markets like India. The global backdrop, therefore, aligns well with domestic tax reforms to create a short-term positive environment for Indian equities.

However, markets remain mindful of risks. Rising US tariffs on key imports continue to influence global trade, and India is positioning itself carefully by recalibrating alliances with countries such as China and Russia. The government’s broader economic strategy highlights India as a potential manufacturing alternative to China, strengthening its long-term growth narrative.

Economic Impact Beyond Markets

Beyond the daily fluctuations of stock prices, the GST reduction is expected to benefit households significantly. Lower tax rates on consumer goods and services could deliver nearly $20 billion in annual savings for households. This creates room for increased discretionary spending, particularly during the upcoming festive season. Sectors such as consumer electronics, automobiles, and packaged foods are expected to see immediate benefits. At the same time, the exemption of health and life insurance premiums from GST may encourage greater penetration of financial protection products in India’s expanding middle class.

From a policy perspective, the reform aligns with the government’s stated goal of simplifying taxation and encouraging compliance. By reducing the number of tax slabs, businesses face fewer administrative hurdles, and consumers gain greater clarity on pricing. While the government absorbs some short-term revenue losses, it hopes to offset these through higher consumption volumes and broader economic growth.

Broader Market Trends

Despite optimism in large-cap indices, the decline in mid- and small-cap stocks indicates cautious positioning among investors. Broader markets are often considered barometers of retail investor confidence. Their underperformance suggests that many retail participants remain watchful, waiting to see whether the GST changes deliver sustained demand growth. Institutional investors, meanwhile, appear to focus on large, liquid names with clearer benefits from the tax reform.

This divergence also underlines the importance of earnings growth in the coming quarters. While tax reforms provide immediate relief, investors will look for confirmation in corporate results, particularly from sectors such as FMCG, autos, and banking.

Final Thoughts

The Indian stock market on September 5, 2025, reflects a day of cautious optimism. Indices open strongly, powered by GST reform enthusiasm and supportive global cues. Intraday highs highlight investor excitement, but profit-booking eventually tempers the gains, leaving the Sensex at 80,718.01 and the Nifty 50 at 24,734.30.

Auto and FMCG stocks shine, while oil and gas, metals, and realty lag. Large-cap indices show resilience, but mid- and small-caps signal caution. GST 2.0 emerges as the clear driver of sentiment, promising tax relief and higher consumption, though questions remain on the sustainability of growth without parallel increases in income levels.

The day’s performance underlines a familiar pattern in markets: strong policy announcements bring immediate excitement, but long-term momentum depends on delivery, earnings, and broader economic conditions. With the festive season approaching and global monetary policy shifts on the horizon, the coming weeks will reveal whether the current optimism turns into a lasting rally or remains a short-term spurt.