By Bharath Rajeswaran
(Reuters) -India’s equity benchmarks ended little changed on Tuesday, as caution prevailed ahead of the central bank’s policy decision, even as monthly gains were underpinned by a rally in state-owned banks and auto stocks fueled by tax cuts.
Steep U.S. tariffs and a hike in H-1B visa fees capped broader advances.
The Nifty 50 closed down 0.1% at 24,611.10, while the BSE Sensex fell 0.12% to 80,267.62, logging losses for eighth straight session. Both benchmarks have shed 3% in eight sessions.
The Nifty and Sensex rose 0.8% and 0.6%, respectively, in September after declining for two straight months.
Twelve of the 16 major sectors logged monthly gains. State-owned lenders rose 11.4%, with State Bank of India up 8.7%.
Banks and non-bank lenders are proxies for economic activity and stand to gain from consumption revival following tax cuts.
Autos climbed 6.3% in September, led by Eicher Motors, Maruti Suzuki, and Hero MotoCorp, amid expectations of stronger festive demand.
Metals added 9.7% on sustained demand and hopes of gains from China’s policies to cut production in 2025.
Small-cap and mid-cap indexes advanced 2% and 1.4%.
On the flip side, information technology shed 4.3% for the month, as worries mounted over rising operating costs after the U.S. hiked H-1B visa fee.
“While global risks remain, the government’s tax cuts triggered monthly gains, offering a dual tailwind to equities as they should drive festive sales, spur demand, and boost earnings,” said Vineet Agrawal, co-founder of online investment platform Jiraaf.
On the day, a decline in rate-sensitives such as FMCG and consumer durables countered gains in state-owned lenders and metals, keeping the benchmarks muted.
Focus is now on the Reserve Bank of India’s monetary policy decision, due on Wednesday. Nearly three-quarters of economists in a Reuters poll expect rates to remain unchanged.
Among stocks, Man Industries slumped 10.5% on Tuesday after regulators barred the company and key executives from the market for alleged fund diversion.
(Reporting by Bharath Rajeswaran in Bengaluru; Editing by Eileen Soreng and Mrigank Dhaniwala)
