By Bharath Rajeswaran
(Reuters) – Indian shares edged higher on Tuesday, lifted by gains in energy and auto stocks and optimism over progress in U.S. trade negotiations with China and India ahead of the Federal Reserve’s rate decision.
The Nifty 50 added 0.39% to 25,166.85 and the BSE Sensex rose 0.4% to 82,118.50 as of 10:12 a.m. IST.
Of the 16 major sectors, 15 advanced. The auto index gained 1%, led by Mahindra & Mahindra’s 1.5% rise. The sub-index is set to snap a five-session losing streak.
Nomura analysts Kapil Singh and Siddharth Bera flagged early signs of demand recovery in the sector following cuts to the Goods and Services Tax (GST).
They named Mahindra & Mahindra, Hyundai Motor India, TVS Motors, and Ashok Leyland as their top picks.
Energy stocks rose 0.8%, gaining for a fifth straight session. HSBC noted that government support for oil marketing companies and steady fuel demand could drive earnings.
The broader small-caps and mid-caps added about 0.6% and 0.3%, respectively.
The MSCI Asia ex-Japan index <.MIAPJ0000PUS> rose 0.7% as investors positioned for an expected U.S. rate cut on Wednesday that could weaken the dollar and spur foreign flows into emerging markets like India. [MKTS/GLOB]
Trade optimism added support ahead of talks between India and the U.S. scheduled for Tuesday, weeks after Washington imposed punitive tariffs on New Delhi’s purchase of Russian oil.
“If we get a trade agreement that removes the punitive tariffs, it could be a real shot in the arm for Indian markets,” said VK Vijayakumar, chief investment strategist at Geojit Investments.
On Monday, U.S. and Chinese officials said they reached a framework to shift TikTok to U.S. control, in a sign of progress in U.S.-China trade negotiations.
In stock-specific moves, NTPC Green Energy jumped 3.5% after its joint venture commissioned a 100 MW project.
(Reporting by Bharath Rajeswaran in Bengaluru; Editing by Sumana Nandy)
