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 Indian shares closed at a near four-month high on Monday, led by metals and automobile stocks, as cooling oil prices and strong buying from foreign investors lifted sentiment.

The NSE Nifty 50 index rose 0.73% at 17,525.10 and the S&P BSE Sensex climbed 0.8% to 58,853.07. The benchmark indexes closed at their highest since mid-April.

"Foreign institutional investors, who were missing from the action over the past few months, have once again started taking exposure to local equities, thus providing a major impetus to the markets," said Shrikant Chouhan, head of retail equity research at Kotak Securities.

Foreign investors have poured $1.79 billion into Indian equities so far this month, according to Refinitiv data.

Meanwhile, oil prices hovered near multi-month lows on Monday, as data pointed to a slow recovery in China's crude imports in July. [O/R]

India, the world's third largest importer of oil, benefits from fall in crude prices as it brings down imported inflation.

In Mumbai trading, Nifty's auto index advanced more than 1%. Automaker Mahindra and Mahindra was one of the top performers on the Nifty 50, gaining 3.3%. Nifty metals index gained 1.3%

Among individual stock moves, Bharat Petroleum Corp was the top drag on Nifty, falling 3.2% after reporting a wider net loss in June quarter.

Shares of SpiceJet fell 4% after Reuters reported that private lenders IDFC First Bank, Yes Bank and state-owned Indian Bank have put their loans to the budget carrier in the high-risk category.

Additionally, investors were buoyed by the prospects of a 7.1% growth in Indian economy in FY2023 on the back of steady performances of services, manufacturing and the farm sectors, per a latest report by CareEdge.

Indian markets will be closed on Tuesday for a holiday.

Investors are awaiting data from U.S. on consumer prices due on Wednesday which will offer more clues on the pace of rate hikes by the Federal Reserve.