The shares of auto companies revved up in top gear on May 15, even as US President Trump hinted that India has offered zero tariffs on all US goods, without offering further details on the progress of the negotiations.
The sharp rise in the auto stocks pushed the Nifty Auto index up nearly 2 percent to close at 23,805.
The surge in auto stocks comes amid a broader rally, with benchmark indices Sensex over 1,200 points higher at 82,531, while Nifty closing 1.6 percent higher at 25,062.
Shares of Hero MotoCorp were the top gainer on the auto index, jumping over six percent to trade at a three-month high. The stock has been seen significant rally recently, extending gains for a fifth consecutive session. The rally supported by the company's fourth quarter results, shared on May 14.
Tata Motors shares followed, jumping over four percent, after Jaguar Land Rover mentioned the US as its fastest-growing market. A possible trade deal and concession on US import tariffs could act as a major positive trigger for the auto sector.
Bajaj Auto and TVS Motor shares followed, rising over 2 percent each. Samvardhana Motherson shares meanwhile closed nearly 2 percent higher. Ashok Leyland and Maruti Suzuki shares gained over 1.8 percent each.
Bosch, Mahindra & Mahindra (M&M), Eicher Motors, Exide Industries and MRF ended the session in the green with marginal gains.
US President Donald Trump on May 15 said that India had offered a "no tariffs" trade deal for American goods. "It is very hard to sell in India, and they are offering us a deal where basically they are willing to literally charge us no tariffs," Reuters cited Trump as saying in a meeting with executives in Qatar.
The US President further said that he had confronted Apple CEO Tim Cook about shifting production to India. "Tim, we treated you very good, we put up with all the plants you built in China for years…We are not interested in you building in India, India can take care of themselves, they are doing very well, we want you to build here," Trump said.
The US had imposed a slew of reciprocal tariffs on a number of trading partners in April, and unveiled 25 percent tariff on imported vehicles and auto parts. Later, the US President eased some of the tariffs, since then, the Trump administration has been hinting at a possible deal with India on the horizon.
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