Diwali festival demand zooms, shrugging off impact of Trump tariffs; Sensex and Nifty gain over 4 pc ahead of symbolic muhurat trading, which falls on Tuesday
The GST rate cuts have not only added an extra zing to the festive buying, but have also brought back exuberance to the capital market, discounting the US tariffs, which pulled down Indian exports to its most lucrative market by 12 per cent in September.
It did take a week for the capital market to ride the festive buying, which typically begins with the start of the autumn Navratri, which began on September 22 – the day the GST cuts came into effect – but it has been robust, over 4 per cent rise for both the major stock indices.
Between September 30 and October 17, the Nifty50 went up by 4.5 per cent and the BSE Sensex by 4.6 per cent – largely powered by the consumer goods, auto and realty stocks.
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Nifty50 hits a high
The Nifty50 hit its highest level this year on October 17 at 25,710 – though below its all-time high of 26,216 on September 26, 2024.
The BSE Sensex at 83,952 on October 17, on the other hand, is yet to breach this year’s high of 84,059 on June 27, 2025, and is a long way off its all-time high of 85,836 on September 26, 2024.
The rise in the capital market indices is in keeping with the reported jump in the sales of consumer durables, FMCG, passenger cars, two and three-wheelers, tractors, insurance, etc, although the actual data will be available next month.
Meanwhile, FPI joined the party too – buoyed by the GST cut, it seems. Having been pulling out for consecutive four months since June, they net invested $2.4 billion during October 1-17.
The rise in Sensex and Nifty is in keeping with the reported jump in the sales of consumer durables, FMCG, passenger cars, two and three-wheelers, tractors, insurance, etc, although the actual data will only be available next month.
Market sentiments may have also been buoyant in anticipation of a further rate cut by the US Fed, which will meet later this month. US President Donald Trump’s October 9 declaration of a pause in the fighting between Israel and Hamas may have also lifted the market’s mood.
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Tuesday's trading
These developments augur well for the muhurat trading scheduled for October 21, amid confusion over whether Diwali is on October 20 or 21.
Muhurat trading is a symbolic trading in the capital market on the Diwali day for about an hour to herald the beginning of a new financial year for traders, especially those from Gujarat, Rajasthan, and Maharashtra.
On this day, traders close their old account books, open new ones and worship them. The Diwali or the ‘muhurat’ trading day does not really coincide with the beginning of the ‘Vikram Samvat’ year – the Hindu calendar year older than the Gregorian calendar which begins around March. But for traders, the Diwali is when new ‘Vikram Samvat’ year begins. This will mark ‘Vikram Samvat’ 2082.
Also Read: How US Fed rate cut brings both relief and risks for India
Muhurat time
This year, the muhurat trading will be held between 1.45-2.45 pm – a time Hindu priests fix by consulting the almanac.
Given the symbolic nature and the short duration, the muhurat trading will typically have low volume transactions – mostly buying by individuals – usually lifting the indices by 0.4-0.5 per cent. Last year, the Nifty50 climbed up by 0.41 per cent and the BSE Sensex by 0.42 per cent. In recent memory, only on two occasions, the muhurat trading saw the indices take a hit.
In 2016, the Nifty50 fell by 0.14 per cent and in 2017 by 0.22 per cent. The BSE Sensex fell by 0.4 and 0.6, respectively. Market experts attribute such events to profit-booking in select stocks that adversely impact the indices.
Earning money on the Diwali or the muhurat trading is considered an auspicious beginning for their new financial year (‘Vikram Samvat’) – even if it is a private affair involving friends and family members.
