Automobile companies are in a super rally on Wednesday despite the Indian benchmarks continued their selling bias tracking weak global cues. Nifty auto stocks have become top picks for this week as semiconductor chip shortage is on the hopes of revival. Besides, traders are expected to play cautious as the Fitch Ratings kept India’s sovereign rating unchanged considering high public debt, a weak financial sector and some lagging structural issues.
Nifty Auto has gained nearly 1% so far on Wednesday.
At around 10:50 AM, it was trading at 12,070.75 up by 93.45 points or 0.78%. The index has been floating between an intraday high and low of 12,39.75 and 11,958.50. The broader sentiment in the sector was positive led by broad-based buying with heavyweights outshining.
Traders took comfort in the semiconductor shortage issue coming to its end with expectations of normalization by month-end.
Stocks like Tata Motors and Mahindra & Mahindra led the winning streak by hitting new 52-week high today. Tata Motors was the top bull surging around 3% at Rs536.70 per piece. Bharat Forge followed the bull rally by soaring around 2% while Bosch, TVS Motor and MRF were above 1% each.
Mahindra & Mahindra hits new record high at Rs979 per piece. While stocks like Tube Investments, Maruti Suzuki and Bajaj Auto traded between flat to marginally up to support the auto sector. Also, Maruti Suzuki stocks extended its gaining spree as investors continue to add the stock to their portfolios amid hopes for normalisation in semiconductor shortages.
Further, Eicher Motors marked its debut on the Dow Jones Sustainability Indices (DJSI)- Emerging Markets category as one among only ten global automotive companies to feature on the elite list for 2021.
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