The US Federal Reserve restarted the rate-cutting cycle after four years, slashing interest rates by 50 basis points (bps) to the range of 4.75 per cent–5.0 per cent, which sent domestic stocks to a record high at opening on Thursday, September 19.
The NSE NIFTY was advancing at 64.05 points, or 0.25 per cent, at 25,441.60 levels, while the S&P BSE Sensex was up 302.77 points, amounting to 0.37 per cent, at 83,251.00 levels. At 12.27 pm.
In the opening bell, both NSE's Nifty and BSE's Sensex continued to rise. The BSE's 30-share index was up about 829 points at a point.
Top gainers and losers
NTPC, LTI Mindtree, Wipro, Tech Mahindra, and Infosys were the top gainers on the NSE. On the exchange, ONGC, BPCL, and Shriram Finance were the biggest losers.
Indian IT stocks benefitted from the US Federal Reserve's interest rate reduction. The Nifty IT index opened at 42,551, up 462 points, amounting to 1 per cent, from the closing of 42,089.30 points in previous trading session.
Last big cut in interest rate
The Federal Open Market Committee, which sets interest rates for the US central bank, had last lowered rates by half a percentage point in 2008, during the height of the global financial crisis, prior to the pandemic.
Expert's opinion
'The Reserve Bank of India (RBI) is unlikely to follow suit in its upcoming meeting. The RBI is expected to maintain its current stance, illustrating how central banks can operate in an asynchronous manner, responding to their unique domestic macroeconomic conditions rather than simply mirroring the Fed's actions,' said Ashwani Dhanawat, Executive Director and CIO, Shriram General Insurance.
'The Federal Reserve rate cut was cut deeper than expected; changes in US economic forecasts indicate a soft patch rather than a recession, which paves the way for rate cuts in emerging markets and is positive for capital flows into emerging markets,' said Trideep Bhattacharya, President & CIO-Equities, Edelweiss MF.
