Auto stocks lift up equity indices as govt hints at reduced GST rates
Aug 26, 2020
Mumbai (Maharashtra) [India], August 26 : Equity benchmark indices gained momentum during the second half of the trading session on Wednesday and closed higher with auto and private banking stocks in focus.
The BSE S&P Sensex closed 230 points or 0.59 per cent higher at 39,074 while the Nifty 50 gained by 77 points or 0.67 per cent at 11,550.
Except for Nifty FMCG and pharma, which dipped marginally, all sectoral indices at the National Stock Exchange were in the green with Nifty auto gaining by 1.5 per cent and private bank by 1.7 per cent.
Among stocks, shares of two-wheeler manufacturers saw good traction after Finance Minister Nirmala Sitharaman hinted at a reduction in Goods and Services Tax (GST) rate from 28 per cent.
She said on Tuesday that the GST Council will consider lowering taxes on two-wheelers as they are neither a luxury item nor a sin good.
Hero MotoCorp was up by 6.4 per cent to close at Rs 3,159.95 per share while Bajaj Auto gained by 2.2 per cent at Rs 3,076. TVS Motor ticked up by 4.8 per cent at Rs 467.55 per share.
Tata Motors share price rose by 8.8 per cent to Rs 138.30, a day after Chairman of the Tata Group N Chandrasekaran said the company had a net automotive debt of Rs 48,000 crore and is targeting to reduce it to near-zero levels in three years.
Index heavyweight Reliance Industries revered morning losses and closed 2.53 per cent higher at Rs 2,134.75 per share. Private lenders IndusInd Bank, Kotak Mahindra Bank and Axis Bank advanced by 5.9 per cent, 2.8 per cent and 2.5 per cent respectively.
However, Bharti Airtel was down by 2.8 per cent while Asian Paints, Maruti Suzuki, HDFC Life and Tech Mahindra traded with a negative bias.
Meanwhile, Asian stocks eased from a two-year high as a mixed bag of economic data put investors on a cautious mode.
Japan's Nikkei was off by 0.03 per cent as Hong Kong's Hang Seng crawled up by 0.02 per cent. South Korea's Kospi was up by 0.11 per cent.
A day earlier, data showed that consumer confidence dropped to a more than six-year low in the United States, overshadowing a boom in new home sales.
US Federal Reserve Chairman Jerome Powell is expected to deliver a speech on Thursday, in which he will outline the central bank's next steps.
