Indian shares rise 0.4 pct; banks, autos climb

* U.S. data, firm global equities help; but resistance seen

* Jaiprakash up on 51 pct rise in Aug cement dispatches
(Updates to mid-morning)

MUMBAI, Sept 2 (Reuters) - Indian shares climbed 0.4
percent on Thursday after better-than-expected U.S. factory
data lifted Asian equities, but there was resistance as
investors were not convinced about the outlook.

Financials firmed on expectations loan demand will pick up
in a growing economy, while auto makers rose after 20-30
percent rise in August sales.

Jaiprakash Associates (JAIA.BO) rallied 3.5 percent after
it said late on Wednesday August cement dispatches jumped 51
percent. [ID:nWNAS9289]

By 10:46 a.m. (0516 GMT), the 30-share BSE index .BSESN
was trading up 0.44 percent at 18,286.80, with 23 of its
components gaining. It rose as much as 0.8 percent early.

"We have been rising due to firm global markets, but there
is not enough confidence to sustain the rally," said Ambareesh
Baliga, vice-president of Karvy Stock Broking.

He said investors were cautious and were booking profits.

The benchmark index is up 4.7 percent this year, largely
driven by foreign portfolio investments of $12.9 billion.

"Valuations are not cheap. It is more of a traders'
market," Baliga said.

Top lender State Bank of India (SBI.BO) rose 0.3 percent
while rivals ICICI Bank (ICBK.BO) and HDFC Bank (HDBK.BO)
climbed 0.9 percent and 1.4 percent respectively. Mortgage
lender Housing Development Finance Corp (HDFC.BO) added 0.8
percent.

Tata Motors (TAMO.BO) rose 1.9 percent, while Maruti Suzuki
(MRTI.BO) and Mahindra & Mahindra (MAHM.BO) firmed 1.2 percent
and 0.4 percent respectively on robust sales. [ID:nSGE6800IE]

Also, Tata Motors (TAMO.BO) chairman said late on Wednesday
the company plans to invest $641 million every year for the
next three years. [ID:nBMA008369]

Top motorcycle maker Hero Honda HROH.BO dropped 1.3
percent as its August two-wheeler sales rose by only 2 percent.
[ID:nBMA008371]

In the broader market, gainers outnumbered losers in a
ratio of 2.6:1 on volume of 125 million shares.

The 50-share NSE index .NSEI was up 0.3 percent at
5,490.35.

STOCKS ON THE MOVE

* Bajaj Auto (BAJA.BO) was up 1.7 percent at 2,797.05
rupees, as the second-largest motorcycle maker said its August
auto sales rose by 55 percent. [ID:nBMA008380]

* Reliance Broadcast Network (REBN.BO) rose 5 percent to
116 rupees after its board approved raising over 4 billion
rupees through an issue of equity shares to its founder and
other investors. [ID:nBMA008375]

* Koutons Retail India Ltd (KRIL.BO) was up 1.4 percent at
310 rupees after it said its board would meet on Sept. 4 to
consider raising funds through issue of shares to the public or
to qualified institutional buyers. [ID:nBMB011401]

MAIN TOP 3 BY VOLUME

* Piramal Healthcare (PIRA.BO) on 12.2 million shares

* Karuturi Global (KART.BO) on 3.7 million shares

* Shree Ashtavinayak (SACV.BO) on 2.3 million shares

FACTORS TO WATCH
* For technical analysis double click on www.reutersindia.net
* India rupee report
[INR/]
* India bond report
[IN/]
* Dollar on defensive after data whets risk appetite
[FRX/]
* Oil slips as investors eye U.S. jobs reports
[O/R]
* Asia stocks rise, US data soothes fears
[MKTS/GLOB]
* Wall St jumps on data in best day in 8 weeks
[.N]
* For closing rates of Indian ADRs
INADR
(Reporting by Ami Shah; Editing by Ranjit Gangadharan)