Shares of automobiles companies gained ground today as petrol prices were cut by Rs 2.46 per litre, the second reduction this month.
Shares of Maruti Suzuki jumped 3.71 per cent to Rs 1,160 on the BSE and was the top gainer among the blue-chip Sensex stocks.
Mahindra and Mahindra was trading up 2.91 per cent, Hero MotoCorp (2.12 per cent), Tata Motors (2.06 per cent), Bajaj Auto (1.76 per cent) and Ashok Leyland (1.21 per cent).
Following the rally in these stocks, the BSE auto index gained 2.14 per cent to trade at 9,453.63 at 10.50 am.
The reduction in rates follows a Rs 2.02 a litre cut in prices from June 3.
Analysts said the reduction in rates will help the auto industry as rising petrol prices had turned away investors and led to inventory pile-ups.
The automobile industry has been reeling under a demand slump as petrol vehicles found lesser buyers with more and more consumers opting for diesel vehicles.