Mumbai: Indian shares rose more than 1% on Tuesday, powered by Tata Motors that rallied after robust February sales and strong consolidated result for the December quarter.
Traders said the market was also catching up with gains elsewhere as trading resumed after a three-day weekend, and supported by last Friday’s budget that stepped up some spending and eased tax rules for individuals.
By 10:50am, the 30-share BSE index was trading up 1.42% at 16,663.26, with 25 of its components advancing. The 50-share NSE index .NSEI was up 1.3% at 4,987.
“The budget has protected the market from downside risks. But it still lacks the momentum,” said Deven Choksey, managing director and CEO of KR Choksey Shares.
“The firm dollar is a worry. That could hamper flows into our country.”
On Friday, finance minister Pranab Mukherjee announced plans to hike spending on social and agricultural programmes popular among voters, and adjusted taxes to put more money in the hands of the middle class.
Tata Motors raced as much as 9.6% after the country’s top vehicle maker reported on Friday a rise in sales and margins at its Jaguar Land Rover (JLR) unit as luxury buyers returned after the global crisis.
On Monday, when the market was closed it reported February sales jumped 58 percent from a year earlier.
“JLR has demonstrated the ability to turn around volumes and realisations, while keeping costs in check,” Nomura analysts Kapil Singh and Prabhat Awasthi said in a note, and raised the stock to “buy” from “reduce”.
“The domestic truck business remains on firm footing, backed by revival in industrial production,” they wrote. The stock was trading up 9.5% at Rs778.25.
Maruti Suzuki India, the leading car maker, firmed 1.5% to Rs1,486 after its sales in February rose 22%.
Top utility vehicle maker Mahindra and Mahindra was up 5.1% and No. 1 motorcycle maker Hero Honda was up nearly 1%.
Reliance Industries, which has the highest weight on the main index, was up 0.8 percent at Rs985.50. It rose as much as 2.1% after a report said the energy major’s bid for chemicals maker LyondellBasell might fail.
In the broader market, gainers were nearly thrice the number of losers on volume of 103 million shares.