Mumbai, Sep 19: India frontline indices opened at an all-time high on Thursday after the US Federal Reserve cut rates by a wider 50 basis points and kicked off an easing cycle that is likely to see rates fall further. At 9.39 a.m., Sensex was up 687 points or 0.83 per cent at 83,635 and Nifty was up 197 points or 0.78 per cent at 25,575.
Banking stocks led the markets. Nifty Bank was up 468 points or 0.89 per cent at 53,246. In early trade, Sensex and Nifty made a new all-time high of 83,684 and 25,587 respectively. Almost all Sensex shares were in the green. NTPC, Wipro, Axis Bank, Tech Mahindra, Infosys, Bajaj Finance, TCS, Kotak Mahindra Bank, Tata Motors, HDFC Bank, TCS and Sun Pharma were top gainers.
Buying was seen in the smallcap and midcap stocks. The Nifty Midcap 100 index was at 60,144, up 391 points or 0.65 per cent, and the Nifty Smallcap was at 19,498, up 108 points or 0.56 per cent. According to market experts, “The big Fed rate cut by 50 bp has the potential to take equity markets into a consolidation phase with an upward bias. The Fed chief Powell’s remark that we have gained greater confidence that inflation is moving sustainably towards 2 per cent is a very optimistic commentary of the US economy.”
“The rate cuts by the Fed will pave the way for rate cuts in India, too. CPI inflation coming below the RBI’s target of 4 per cent during the last two months will facilitate rate cuts. Two rate cuts of 25bp each are possible in India before March 2025. In brief, the market scenario is turning favourable for rate-sensitives, particularly banking,” they added.
Most of the Asian markets are trading at a brisk pace. Tokyo, Shanghai, Hong Kong and Jakarta are in green. The US markets closed with a marginal fall on Wednesday. The foreign institutional investors (FIIs) bought equities worth Rs 1,153 crore on September 18, while domestic institutional investors also bought equities worth Rs 152 crore on the same day.
IANS