By Bharath Rajeswaran and Vivek Kumar M
(Reuters) -India’s equity benchmarks closed higher on Monday following three straight sessions of losses, as higher monthly sales lifted automobile stocks while better-than-expected economic growth data boosted overall sentiment.
The Nifty 50 rose 0.81% to 24,625.05 and the BSE Sensex added 0.70% to 80,364.49. Both the benchmark indexes had fallen around 2.2% in the last three sessions.
Auto stocks soared 2.8% and the index was the top sectoral gainer. The top five Nifty gainers were also auto companies. Bajaj Auto rose 3.9% and topped the charts, while TVS Motor Company hit a record high.
The broader consumption-driven stocks also surged, ahead of a Goods and Services Tax (GST) council meeting later this week to discuss tax cuts.
Consumer durables and consumption gained 2.1% and 1.2%, respectively.
Also helping sentiment was a U.S. court ruling that most of President Donald Trump’s tariffs were illegal. The court allowed the tariffs to remain in effect until October 14, giving the administration time to file an appeal before the Supreme Court.
India’s GDP data and U.S. court ruling on Trump’s tariffs, coupled with hopes of GST rationalisation, have led to some positivity on the Street after a few sessions, said Sunny Agrawal, head of fundamental equity research at SBICAPS Securities.
“The investors are gung-ho on (the) consumption theme as it is backed by festive season, good monsoon and GST rationalisation hopes,” Agrawal said.
Fifteen of the 16 major sectors advanced in a broad-based rally. The broader more domestically focussed mid-caps and small-caps gained 2% and 1.6%, respectively.
IT stocks jumped 1.6% after in-line U.S. Personal Consumption Expenditures data kept alive hopes of a Federal Reserve rate cut in September.
CLSA expects 75 basis points of cuts over the next 1–1.5 years, which could lift valuation multiples of Indian IT firms by 10–15%, as they derive a significant share of revenue from the world’s largest economy.
(Reporting by Vivek Kumar M and Bharath Rajeswaran in Bengaluru; Editing by Sumana Nandy and Janane Venkatraman)
