Sensex jumps over 700 points, Nifty crosses 25,500 for 1st time; IT stocks gain

Benchmark stock market indices hit all-time highs on Thursday after the US Federal Reserve cut interest rates by 50 bps.
The S&P BSE Sensex was up 758.7 points at 83,706.93 at 9:41 am, while the NSE Nifty50 gained 215.40 points to trade at 25,592.95.
Most of the broader market indices also gained sharply as volatility fell sharply as analysts expressed optimism about the Fed’s big rate cut.
All the major Nifty sectoral indices gained sharply during early trade, with high-weightage Nifty IT, Nifty Bank and Nifty Financial Services leading from the front.
While major information technology stocks gained as a result of the US Fed’s rate cut, other stocks like NTPC, Grasim, Titan, Bajaj Auto and Axis Bank were among top gainers on the Nifty50.
On the other hand, the top losers were ONGC, BPCL, HCLTech, Bajaj Finserv and Dr Reddy’s.
Dr. V K Vijayakumar, Chief Investment Strategist, Geojit Financial Services, said, “The big Fed rate cut by 50 bps 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%” is a very optimistic commentary of the US economy. At the same time US growth continues to be solid and the labour market is good.”

“More rate cuts are expected from the Fed, going forward. The rate projections are 4.4% by end 2024 and 3.4% for end 2025. These will be big declines from the present 4.75 to 5% rate,” he added.

Vijayakumar also noted that 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% during the last 2 months will facilitate rate cuts. Two rate cuts of 25bps each are possible in India before March 2025. In brief the market scenario is turning favourable for rate-sensitives, particularly banking.”
“The Nifty’s structure remains bullish as long as it trades above the 25,300 level. A break below this point may trigger profit booking. On the upside, immediate target levels are 25,600 and 25,921,” said Santosh Meena, Head of Research, Swastika Investmart Ltd.