Mumbai: Indian shares erased sharp early losses and ended flat on Monday, after robust sales data from auto makers raised expectations for a stronger outlook and helped soften the blow from weak global equities.
Leading utility vehicle maker Mahindra and Mahindra said its sales in January jumped 71% from a year earlier, while Maruti Suzuki, the country’s top car maker, posted a 33% rise.
Mahindra shares climbed 2.7% and Maruti added 0.7%, while the largest vehicle maker Tata Motors rallied 3.6% to Rs719.05 on expectations it may follow suit.
After the market closed, Tata Motors, which makes trucks, buses, utility vehicles and cars, said January sales rose 77% from a year earlier.
The stock had initially declined after it reported late on Friday quarterly net profit from domestic operations lagged market estimates.
The 30-share BSE index closed down 0.01%, or 1.93 points, at 16,356.03, with 21 of its components declining. It had fallen as much as 1.2% in early deals, after sliding 6.3% in January — its biggest monthly drop in since October.
“The market is just trying to find support for now. The action has shifted to mid-cap stocks, where investors are finding value and comfort,” said Jigar Shah, vice-president of equity sales at Motilal Oswal Financial Services.
News from the domestic front have been encouraging, but shaky world stocks weighed on the market.
Manufacturing in Asia’s third-largest economy in January grew at its fastest pace, boosted by a sharp rise in new export orders that underpin a recovery in the industrial sector, a survey showed.
Exports continued to rebound, rising an annual 9.3% in December to $14.6 billion, their second consecutive monthly rise, although the pace of annual growth was slower than the 18.2% registered in November.
World markets dropped to a three-month low, as concerns about Greece’s debts and a reminder of the challenges China faces to curb inflation stung risk demand.
At 1034 GMT, the pan-European FTSEurofirst 300 index was down 0.3%.
Jaiprakash Associates firmed 2.1% to Rs140.60 after the engineering and construction firm said its January cement shipments rose 60% from a year earlier.
Export-focused outsourcers closed mixed. Tata Consultancy Services and Wipro gained 1.4% and 3.1% respectively, while Infosys Technologies shed 1.1%.
“Investors are just churning their portfolio in the IT sector,” said Shah.
Reliance Communications gained 2.3% to Rs173.80 after it reported a smaller-than-expected 21% drop in quarterly profit, as forex gains and lower costs helped India’s No. 2 mobile operator curb losses from huge declines in call charges.
Leading consumer goods maker Hindustan Unilever fell 2.9% to Rs237.10, after Citigroup downgraded the stock to “sell” from “hold” on Sunday.
In the broader market, there were three gainers for every loser on volume of 394 million shares, slightly lower than last week’s daily average of 411 million shares.
The 50-share NSE index closed 0.4% higher at 4,899.70.
Stocks that moved
Drug maker Lupin extended gains and rose 10.8% to Rs1,574, after it posted a 38% rise in consolidated quarterly net profit on Friday.
Reliance Capital dropped 1.7 % to Rs790 after the financial services firm said on Saturday quarterly net dropped 52%.
Reliance Infrastructure gained 0.9% to Rs1,042.80 after the engineering, construction and power firm said late Friday its December quarter net rose 10%.
Sugar millers such as Shree Renuka Sugar, Bajaj Hindusthan, Balrampur Chinni and Dhampur Sugar rose 2.1-6.5%, after the spot prices for sugar jumped 3.5% on Monday afternoon.
Main top three by volume
Himachal Futuristic on 19.9 million shares
Unitech on 14.1 million shares
Suzlon Energy on 11.1 million shares