Sensex gains 240 pts after rangebound trade powered by gains in auto stocks; Nifty near 18,600

Tracking gains in Asian peers, Indian equity indices closed higher in a rangebound trade on Monday, powered by sustained gains in auto stocks.

Asian stocks followed Wall Street higher on Monday after strong US hiring data suggested a possible recession might be further away and that the US Fed would pause rate hikes this month.

The 30-share BSE benchmark Sensex rose 240 points or 0.38% to settle at 62,787. The broader NSE Nifty surged 60 points or 0.32 to end at 18,594.

From the Sensex pack, M&M, Axis Bank and Tata Motors were the top gainers, rising 2-4%. L&T, Tata Steel, ICICI Bank, Reliance, Maruti and IndusInd Bank also ended with gains. Whereas, Asian Paints, Tech Mahindra, Nestle, HUL and Kotak Bank ended with cuts.

Shares of Indo Rama Synthetics closed 16% higher after its wholly owned subsidiary lndorama Yarns started commercial production of Bottle grade PET resins. Meanwhile, Rossari Biotech also closed nearly 6% higher.

Nifty Auto Index was the top sectoral gainer and hit a record high in trade, while the Nifty FMCG Index pared gains after hitting an all-time high for the seventh straight session. In the broader market, Nifty Midcap100 gained 0.14%, and Smallcap100 rose 0.36%.

Global Markets
Most Asian markets rose on Monday on optimism the Federal Reserve would pause its rate hikes this month after a mixed US jobs report. Tokyo's benchmark gained almost 2%. Shanghai, Hong Kong and Seoul also rose.

Wall Street futures were subdued on Monday after a solid rally last week, as investors weighed the possibility of a pause in interest rate hikes by the Federal Reserve at its upcoming policy meeting.
Futures: Dow up 0.12%, S&P up 0.01%, Nasdaq down 0.27%

Expert Views
"Following strong momentum of the global indices, Indian markets started the week on a firm note but due lack of follow through, Index remained rangebound throughout the day and formed a shooting star candlestick pattern," said Aditya Gaggar, Director of Progressive Shares.

"In the higher time-frame, the index is in a rising channel and correction, if any, will provide good entry levels. Lower side is protected at 18,550 while the higher side is capped at 18,650; close above the resistance levels, we can see a new high on the Index," Gaggar added.

Deepak Jasani, Head of Retail Research at HDFC Securities, said, "Nifty formed a spinning top on June 5. The band of 18640-18662 is proving tough to cross. Beyond this, Nifty could face resistance at 18696 while 18464 could provide support on falls in the near term."

Oil rises
Oil prices rose by more than $1 a barrel on Monday after top crude exporter Saudi Arabia pledged to cut production by a further 1 million barrels per day (bpd) from July to counter macroeconomic headwinds that have depressed markets.
Brent crude futures were up $1.72, or 2.3%, at $77.85 a barrel after touching a session high of $78.73. US West Texas Intermediate crude climbed $1.72, or 2.4%, to $73.46 after hitting an intraday high of $75.06.

Rupee drops
The rupee posted its biggest single-day fall since mid-March on Monday, pressured by broad strength in the dollar, weakness in the yuan, and likely hedging by importers following robust US jobs data late on Friday.

The rupee closed trading at 82.67 per dollar compared with 82.3050 on Friday. During trade, the unit touched a low of 82.66 and shed 0.44% on day, to mark its worst session since March 14.
(With inputs from agencies)