India’s Nifty, Sensex hit record highs on auto stocks; earnings loom

Investing.com-- India’s benchmark Nifty and Sensex stock indexes hit record highs on Monday, buoyed chiefly by gains in automobile stocks, with focus now turning squarely to the upcoming earnings season.

The Nifty 50 rose 0.5% to a record high of 22,634.30 points, while the BSE Sensex 30 rose 0.5% to a record high of 74,673.84 points.

Both indexes were boosted chiefly by gains in automobile stocks. Eicher Motors Ltd. (NS:EICH), Mahindra&Mahindra Ltd. (NS:MAHM), and Maruti Suzuki India Ltd. (NS:MRTI) were among the top gainers on both indexes, up between 2.6% and 3.6%. 

All three stocks hit record highs, as recent auto sales data for March showed major Indian automakers clocking record-high levels of car and two-wheeler sales. Mahindra in particular rose sharply in anticipation of the new version of its XUV model. 

Indian auto sales also signaled that consumer demand in the country remained strong- a trend that boosted most consumption-linked stocks on the Nifty and the Sensex. 

Strength in financials also boosted Indian indexes, as major bank stocks cheered signals from the Reserve Bank of India that it will keep interest rates steady for the time being. 

The positive trends saw Indian stocks sitting on three straight weeks of gains, with focus now turning to the upcoming quarterly earnings season.

Technology major Tata Consultancy Services Ltd. (NS:TCS) is set to report its December quarter earnings later this week, while peer Infosys Ltd (NS:INFY) will report quarterly earnings next week. 

HDFC Bank Ltd (NS:HDBK) is also set to report earnings next week. 

Still, the upcoming 2024 general elections are expected to provide some risks to Indian markets, especially with stocks sitting at record-high valuations. 

While the incumbent BJP party is widely expected to win a third consecutive term, any signs to the contrary could spur volatility in Indian stocks.