Reports of tax reliefs for the investing community amid a decent set of corporate results and a pick up in auto sales lifted stock market sentiment on Tuesday, with the benchmark Sensex zooming 582 points to close at a near four-month high.

The 30-share index soared over 666 points during intra-day trades and later settled at 39831.84 — a gain of 581.64 points, or 1.48 per cent.

On the NSE, the broader Nifty rallied 159.70 points, or 1.37 per cent, to close at 11786.85. The rally led to the market capitalisation of BSE-listed companies rising Rs 2.73 lakh crore to around Rs 15.2 lakh crore.

The smart gains came after reports that said after the corporate tax cuts, the Centre could come out with multiple relief measures for the stock markets. These include doing away with the dividend distribution tax (DDT) and a tweak in the long-term capital gains tax (LTCG) and even in the securities transaction tax (STT).

Domestic companies pay DDT of around 20.35 per cent (including cess and surcharge) on dividends distributed by them to the shareholders.

However, an individual receiving Rs 10 lakh as dividend has to pay an additional tax of 10 per cent. DDT is also applicable on both equity oriented and debt mutual funds.

LTCG on equities and equity mutual funds was introduced by former finance minister Arun Jaitley. Equity investors have to pay LTCG of 10 per cent on profits of over Rs 1 lakh. Similarly, STT is paid by an investor while purchasing and selling securities.

The news came alongside other encouraging developments. Broking circles said many companies have reported better than expected results in the second quarter. Moreover, latest reports of a pick-up in auto sales during the festival season added to the positive sentiment.

Tata Motors continued to hog the limelight after its losses narrowed during the second quarter. Its shares rose about 17 per cent.

Shares of Reliance Industries also ended 2.30 per cent higher as the markets reacted positively to its announcement on setting up a new subsidiary that will house all its digital initiatives and apps.

“The latest numbers from ICICI Bank, the SBI and Tata Motors were better than estimates and led to overall positivity’’ Siddhartha Khemka, head — retail research, Motilal Oswal Financial Services, said.

The markets gained momentum on the back of several positive developments. Globally there was news of the US reaching a trade deal with China early next month. On the domestic front, news of the government looking at simplifying various taxes related to equities helped boost sentiments. The second quarter results so far have been in-line or better than expectations.

Sectorally, BSE auto and metal indices rallied up to 4.25 per cent; followed by energy, industrials and IT indices, rising up to 2.32 per cent.