Benchmark indices log gains for third day; auto stocks drive rally

MUMBAI: Indian equities continued their winning run for a third session in a row on Tuesday as positive news on the Us-china trade deal front and consumer demand revival hopes in the upcoming festive season enthused investors.

The BSE benchmark Sensex rallied around 421 points during the day but pared some gains towards the fag-end of the session and settled 291.62 points, or 0.76 per cent, higher at 38,506.09 -- a two-week high for the index.

Similarly, the broader NSE Nifty rose over 87 points, or 0.77 per cent, to settle at 11,428.30.

The market rally was mainly driven by auto and metal stocks.

Top gainers in the Sensex pack were Vedanta, M&M, ONGC, Hero Motocorp, Maruti Suzuki and HUL rising up to 3.79 per cent.

On the other hand, Bharti Airtel, Infosys, Tata Motors, HCL Tech, Tech Mahindra and Bajaj Finance fell as much as 2.53 per cent.

Of the 30 scrips on the Sensex, 24 shares closed with gains and 6 with losses.

Sectorally, BSE auto emerged as the top gainer with 2.36 per cent rise. Other top performers were metal, bankex, power and FMCG -- rising 1.56 per cent.

On the other hand, BSE telecom, teck and IT indices fell up to 2.15 per cent.

In the broader market, BSE largecap outperformed the benchmark Sensex by rising 0.79 per cent. BSE midcap index also gained 0.72 per cent but smallcap index slipped 0.11 per cent.

In the last three trading sessions, the Sensex has added 625.69 points or 1.64 per cent and the Nifty has gained 193.75 points or 1.71 per cent.

"Green shoots from USChina trade talks added positivity while outperformance in domestic auto stocks in expectation of festival demand further lifted the sentiment. FIIS are net buyers in the last two days given stability in global market. Start of Q2 results is mixed but some tailwinds on future earnings outlook will help the market to maintain the momentum," Vinod Nair, Head of Research, Geojit Financial Services, said. Experts are also of the view that the central bank will continue with its accommodative policy stance and may go for further rate cut in the policy review of December 2019, as retail inflation moved up in September.

Retail inflation climbed to a 14-month high of 3.99 per cent in September due to costlier vegetables and pulses but still remained within the RBI'S comfort zone, government data showed on Monday.