Auto scrips skid up to 27% in 3 months. Check Q4 expectations and 13 stocks to buy

The auto sector is currently facing a challenging environment with cost pressures and supply chain issues, despite underlying demand. Q4 expectations will be crucial for near-term sentiment.

Maintain a bearish bias on the Nifty Auto index; look for shorting opportunities on rallies or consider long positions only in fundamentally strong, analyst-recommended stocks with strict stop-losses.

For Indian markets, this story mainly matters for MARUTI, M&M, and the Automobiles, Auto Ancillaries pocket. The current signal is bearish, so traders should look for follow-through in price, volume, and sector breadth instead of reacting to the headline alone.

Watch whether the next market session confirms the setup described here: Mentioned as a top Nifty loser in related news, indicating broad auto sector weakness. Mentioned as a top Nifty loser in related news, indicating broad auto sector weakness. Also track volume confirmation, sector participation, and whether the move holds beyond the first reaction.

• •Auto stocks have fallen up to 27% in the last three months.
• •The decline occurs despite healthy vehicle demand.
• •Concerns include rising input costs, crude oil price volatility, and potential supply disruptions.
• •Experts anticipate continued underperformance in the near term.
• •Some analysts are identifying select auto stocks for potential investment.