In early trading on Thursday, benchmark equity indices Sensex and Nifty reached new record highs, buoyed by the US Federal Reserve’s decision to cut its benchmark interest rate for the first time in over four years.
The 30-share BSE Sensex surged by 735.95 points, reaching an all-time high of 83,684.18. Meanwhile, the NSE Nifty climbed 209.55 points to hit a record peak of 25,587.10.
V K Vijayakumar, Chief Investment Strategist at Geojit Financial Services, noted that the substantial 50 basis point rate cut by the Fed could lead equity markets into a consolidation phase with an upward trend. He also suggested that this move may set the stage for similar rate cuts in India.
Further rate reductions from the Fed are anticipated, Vijayakumar added. Among the 30 companies in the Sensex, major gainers included NTPC, Axis Bank, Tata Motors, Tata Consultancy Services, Bharti Airtel, Tech Mahindra, Infosys, and HDFC Bank. Conversely, Bajaj Finserv stood out as the only laggard.
Asian markets showed positive momentum, with Tokyo, Shanghai, and Hong Kong experiencing gains, while Seoul traded slightly lower. In the US, markets closed down on Wednesday.
Foreign Institutional Investors (FIIs) were active in the Indian markets, purchasing equities worth ₹1,153.69 crore on Wednesday, according to exchange data.
Vijay Bharadia, Founder of Wallfort Financial Services Ltd, described the Fed’s 50 basis point cut as a bold move to stimulate the US economy, suggesting that this could encourage other global central banks, including the Reserve Bank of India, to adopt a more accommodating interest rate policy.
Additionally, global oil prices saw a slight decrease, with Brent crude dipping 0.07 percent to USD 73.60 per barrel.
On Wednesday, the BSE benchmark had closed down 131.43 points, or 0.16 percent, settling at 82,948.23, while the NSE Nifty fell by 41 points, also down 0.16 percent, to finish at 25,377.55.
