Sensex, Nifty surge after GST overhaul; auto, insurance stocks gain

Indian equity markets opened higher on Thursday, with benchmark indices Sensex and Nifty 50 rallying after the GST Council approved a major overhaul, cutting tax rates on nearly 400 items.

In the opening trade, Sensex jumped over 650 points and Nifty traded above the 24,900 mark with auto and insurance stocks witnessing a sharp rise from their previous close.

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In the automobile sector, Mahindra & Mahindra shares gained 6.48 per cent in the opening trade, followed by Tata Motors, which rose by 1.47 per cent. Bajaj Auto, Hyundai Motor India, TVS Motor Company and Maruti Suzuki were also trading in the green.

The GST council slashed tax on petrol and diesel cars from 28 per cent to 18 per cent.

Petrol and petrol-hybrid cars (up to 1200 cc and 4000 mm) and diesel and diesel-hybrid cars (up to 1500 cc and 4000 mm) will now fall under the 18 per cent tax slab, a 10 percentage point cut from the earlier 28 per cent.

Insurance stocks also rallied after the Council exempted health and life insurance from GST.

Life Insurance Corporation (LIC) was trading 2.39 per cent higher. Niva Bupa Health Insurance rose 4.04 per cent and HDFC Life Insurance stocks were trading 2.52 per cent higher.

Other insurance stocks, including ICICI Prudential Life Insurance, General Insurance Corporation, Star Health and Allied Insurance and SBI Life Insurance were also trading in the green.

Clothing, footwear, electronics, and sin goods stocks saw sharp upward momentum following the tax rationalisation.