BENGALURU, Oct 28 (Reuters) -

Indian shares were trading higher on Friday, boosted by energy and automobile stocks and as the continued drop in U.S. Treasury yields made riskier assets more appealing.

The NSE Nifty 50 index advanced 0.52% to 17,829.25 as of 0443 GMT, and the S&P BSE Sensex rose 0.56% higher to 60,090.58. If gains hold, the benchmark indexes may register their second straight weekly rise.

"In India, even though valuations look high from the short- term perspective, there are favourable factors that can take the market higher," said V K Vijayakumar, Chief Investment Strategist at Geojit Financial Services

"The important positive is the decline in U.S. 10-year bond yield to below 4%, which will persuade the foreign investors to buy rather than sell in the near-term."

The benchmark U.S. 10-year yield was at 3.91% after data showed U.S. consumer and business spending slowed in the third quarter, pointing to a possible peak in inflation that could allow the Federal Reserve to ease its aggressive rate hikes.

Foreign institutional investors bought a net 28.18 billion Indian rupees ($342.12 million) worth of equities on Thursday, while domestic investors sold net 15.80 billion rupees worth of shares, as per provisional data available with the National Stock Exchange.

In domestic trading, Nifty's energy and automobile indexes rose more than 1% each. The metal index dropped 1.1% after a 2.7% surge in the previous session.

Nifty 50 component top carmaker Maruti Suzuki climbed as much as 1.8% to a one-month high ahead of its quarterly earnings report.

Infibeam Avenues surged as much as 16.6% after the fintech firm

said

it got an approval from the Reserve Bank of India to operate as a payment aggregator.

In broader equities, Asian shares were set to snap a three-day winning streak as investors balanced mixed earnings reports. ($1 = 82.3680 Indian rupees) (Reporting by Rama Venkat in Bengaluru; Editing by Neha Arora and Janane Venkatraman)