The Sensex made a spectacular rally of 300 points to close at over one-week high of 31,221.62 on Monday and the Nifty broke through the key 9,600 as investors swore by the Goods and Services Tax that kicked in from July 1.
There seemed no end to buying as the sweeping tax reform is expected give a huge momentum to the country’s economy and draw global businesses to invest more here, traders said.
After a strong opening, the BSE 30-share index hit a high of 31,258.33, before closing 300.01 points,or 0.97 per cent higher at 31,221.62, a level last seen on June 22.
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The gauge had gained 87.29 points in the previous two sessions. The 50-share Nifty after scaling the day’s high of 9,624, ended up 94.10, or 0.99 per cent, at 9,615.
Cigarette maker ITC was the top gainer among Sensex stocks, rising 5.70 per cent to end at a 52-week high. This is mostly because taxation for cigarettes under the new Goods and Services Tax (GST) is around 5-6 per cent lower than the previous tax structure. It also drove the Nifty index higher.
Other cigarette stocks VST Industries and Godfrey Phillips too rose 3.97 per cent and 1.93 per cent, respectively.