Stock Market Today: Ashok Leyland to Samvardhan Motherson, the Auto stocks saw a sharp rise after the 50 bps repo rate cut announced in RBI MPC meeting. The rate sensitive Auto stocks got a tailwind as the reduces lending rates could spurt sales of Passenger Vehicles, Two wheelers, commercial vehicles etc Nifty Auto index gained near 1%.
Nifty Auto Index sees smart gains
The Nifty Auto Index opened at 23,343.05 almost 1.6% higher than the previous days closing price of – 23,306.206 in anticipation of some rate cat announcement by the Reserve Bank of India as it announced the RBI MPC outcome.
However the RBI governor made a surprise repo rate cut by 50 basis point coupled with CRR or cash reserve ratio or CRR cut by 100 bps. 100 bps represents 1%. The repo rate cut by a bumper 50 basis points (bps) lead CRR coming down to 5.50% from 6.00% earlier.
The decisions by RBI thereby are being anticipated by investors to lead to swift reduction in the lending rates by the banks and this in turn may lead to pick up in the automobile sales.
Key Auto gainers
The rise in the auto index was led by gains in Ashok Leyland share prices followed by Hero MotoCorp Ltd while Samvardhan Motherson stood among key gainers.
Ashok Leyland share price gained almost 4% in the morning trades on Friday. Hero MotoCorp and Maruti Suzuki India share price also saw smart gains of 2-3% and were not much far behing the Ashok Leyland share price gains. The Balkrishna Industries Limited share rpice was another key gainer rising up to around 2%.
Samvardhan Motherson share was among prominent Nifty Auto stock gainers,
Most other stocks saw shar gains of close to 1% or more. These included Bharat Forge Limited, Eicher Motors Limited, Bajaj Auto Ltd and TVS Motor Company. Ltd
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