India’s stock benchmarks to open higher on GST cuts, US rate cut hopes

India’s equity benchmarks are poised to open higher on Monday, after dismal US labour data heightened the expectations of a Federal Reserve rate cut this month, while the Indian government’s tax cuts also buoyed sentiment.

Gift Nifty futures were trading at 24,905.5 points as of 07:49 a.m. IST, indicating that the Nifty 50 will open above Friday’s close of 24,741.

The Nifty and BSE Sensex rose 1.3% and 1.1%, respectively, last week after the Goods and Services Tax council cut levies on everyday goods in an effort to stoke consumption.

Other Asian markets opened higher, with the MSCI Asia ex-Japan index rising 0.4% after data showed the US created far fewer jobs than expected in August, raising hopes of a rate cut later this month.

Lower interest rates in the US make emerging markets such as India attractive for foreign investors.

Foreign portfolio investors remained net sellers of Indian stocks for the tenth straight session on Friday, offloading stocks worth 13.05 billion rupees.

Domestic institutional investors continued their buying streak to the ninth session on Friday, purchasing stocks worth 18.21 billion rupees.

“Looking ahead, sentiment is likely to remain mixed. Domestic growth-linked sectors stand to benefit from GST relief, resilient consumption, and government spending, while uncertainty over global trade negotiations continues to restrain risk appetite,” said Vinod Nair, Head of Research, Geojit Investments.